AFFLUENCE

DIRECTORS' REPORT

The Directors have pleasure in presenting their 93rd Annual Report together with the Audited Accounts of the Company for the nine (9) months period ended 30th September, 2014.

The year under review is a 9 month period commencing on 1st January, 2014 and ending on 30th September, 2014. During the period, the Turnover of the Company on a standalone basis stood at Rs. 2,966.99 Crore, as compared to Rs. 3,279.31 Crore during the previous period. The Company posted a Net Profit after Tax of Rs. 67.80 Crore during the period ended 30 September, 2014, as against a Net Loss after Tax of Rs. 765.91 Crore during the previous period ended 31 December 2013.The profit was mainly on account of sale of the Company's stake in its infrastructure development arm Gammon Infrastructure Projects Limited to its wholly owned subsidiary Gammon Power Limited.

On a Consolidated basis, the Turnover of Gammon Group stood at Rs. 3,842.61 Crore as compared to Rs. 4,932.42 Crore for the previous period. The Group posted a Net Loss after Tax of Rs. 728.88 Crore during the period ended 30 September 2014, as against a Net Loss after Tax of Rs. 761.86 Crore during the previous period ended 31 December 2013.

The macro -economic environment is facing a slow growth trend. It has further deteriorated and year 2014 was another challenging year for EPC companies and your Company was no exception. The Indian economy continued to face troubled times with the depreciating rupee, high inflation and endemic liquidity problems. Policy indecisiveness, scarce financial resources, inflationary pressures, project delays due to unexpected developments, bureaucratic hurdles and other similar factors continued to create innumerable difficulties to both, the sector and the Company.

The infrastructure segment continued to be sluggish due to policy inaction and liquidity constraints. Project execution continued to be slow due to delays in funding. Interest and Finance costs continued to be high. The backlog at stalled project sites created due to severe liquidity crisis continued to adversely affect project execution. The Company was affected due to resource crunch, delays beyond the control of the Company such as delays in land acquisition, municipal permission, approval of designs by client, and over and above scarcity in availability of labour and materials thereby widening the gap between the planned outlay and actual spending. Order intake remained sluggish, since many of the stalled projects are yet to be kick-started. Projects already awarded are generally progressing slowly due to various continuing problems on ground, which remain unresolved over the years leading to cost escalations which remain unpaid.

The Company's overseas operations were characterized by weak order booking, inflexible labour markets, paucity of working capital and uncertain political climate. Continuation of recession in the European economy, and weak Euro position against the USD has frazzled the investment of the Group.

The Company is exploring several options for overcoming the liquidity crisis. The Group is in the process of monetizing its investments in real estate as well as of its overseas assets divesting its non-core businesses and disposal of idle equipment. During the period under review the Company focused on realizing long pending receivables, arbitration awards, retention moneys. Several projects were concluded and moneys are being realized. The Company is now concentrating on bidding projects relating to its core competency as also projects with high yielding margins. Your management has been striving hard and taking all efforts in ensuring repayment of interest due to CDR lenders. The Order book as on 30th September 2014 stood at Rs. 12,800 Crore.

With a new and progressive government at the Centre, the situation is likely to improve. With the Government's helping hand and positive attitude we look forward to a phased economic revival and boosting of business confidence due to hard policy decisions. We are hoping the government will come up with a clear cut road-map for implementing the policies. The upturn in sentiment means roads, ports and power projects will get on-stream. In addition to this, there will also be expediting of stalled infrastructure projects, revival of investment climate and sorting of infrastructure clearances. The government is expected to provide an environment conducive for growth investments, with major reforms in infrastructure sector, enabling all-round growth. There is a expected to be a kick-start to slow-moving highway projects.

Your Directors continue to believe in the long-term potential of India's infrastructure space. Moving forward, our business growth will be driven by our proven technical prowess in design, operations and maintenance. Going forward, our focus will be to consolidate existing opportunities and leverage new possibilities.

2. DIVIDEND:

As the Company is under a corporate debt restructuring, the Directors have not recommended any dividend for the nine (9) months period ended 30th September 2014 even though the Company has earned profits during the said period.

3. DEPOSITORY SYSTEM:

The Company's equity shares are compulsorily tradable in electronic form. As of 30th September 2014, 93.08% of the Company's total paid-up capital representing 127,048,879 equity shares is in dematerialized form. In view of the benefits offered by the Depository system, members holding shares in physical mode are advised to avail the demat facility.

4. FINANCE:

The Company is presently under a Corporate Debt Restructuring which was approved by lenders in June 2013. Total debts aggregating to Rs. 14,817.17 Crore have been restructured. The said restructured debts have been secured by mortgage and hypothecation of the Company's movable and immovable properties. Collateral security has also been provided to the CDR Lenders by way of (i) infusion of an amount of Rs. 100 Crore by the promoters, (ii) pledge of equity shares held by the promoters in the Company, (iii) personal guarantee by Mr. Abhijit Rajan - Chairman & Managing Director and (iv) Corporate Guarantee by one of the promoter companies viz. Nikhita Estate Developers Private Limited. The CDR package provides a ten year repayment plan (including a two year moratorium) of the Company's existing debts. The interest rate on the restructured debt has been lowered by 1-2% for 15 months period from cut-off date i.e. 1st January 2013 upto 31st March 2015, apart from waiver of penal charges from the cut-off date till the date of implementation of the project and additional funding by way of priority loan. The CDR package approved by the lenders gave the Company the much needed breather to streamline its operations, improve cash flows, recover its long term trade receivables, reduce its operational costs and also additional funding to tide over its immediate working capital requirements. ICICI Bank Limited is the monitoring institution and IDBI Trusteeship Services Limited is the Security Trustee acting on behalf of all the CDR Lenders. Majority of the envisaged securities were created by 31st March 2014.

During the year under review the Company did not raise any capital from the Capital markets either by way of issue of equity shares /ADR/GDR / or any debt by way of Debentures. The Company continued to get financial assistance from its CDR lenders within the overall facilities sanctioned under the CDR package to meet the working capital requirements.

5. PUBLIC DEPOSITS:

The Company did not invite or accept deposits from public during the year under review.

6. TRANSFER TO INVESTOR EDUCATION AND PROTECTION FUND:

During the nine (9) months period ended 30th September 2014, the Company has transferred Interim Dividend amounting to Rs. 209,863/- and Final Dividend amounting to Rs. 47,094/- (both for the year 2006-07) to Investor Education and Protection Fund (IEPF), which was due and payable and remained unclaimed and unpaid for a period of seven years, as provided in Section 205C(2), of the erstwhile Companies Act, 1956.

7. SUBSIDIARY COMPANIES:

No new subsidiary was incorporated / acquired by the Company during the nine (9) months period ended 30th September 2014. During the period under review, names of the Company's following step down subsidiaries were struck off the Register of Companies by the Ministry of Corporate Affairs on an application made by the respective companies:

(a) Dohan Renewable Energy Private Limited (effective 23rd March 2014)

(b) Kasavati Renewable Energy Private Limited (effective 23rd March 2014)

(c) Indori Renewable Energy Private Limited (effective 2nd July 2014)

(d) Markanda Renewable Energy Private Limited (effective 2nd July 2014)

(e) Sirsa Renewable Energy Private Limited (effective 29th August 2014)

During the period under review, the Company divested its entire stake in its subsidiary viz. Gammon Infrastructure Projects Limited ("GIPL") by sale of 528,000,000 equity shares (constituting 52.28% at the time of the sale) of Rs. 2/- (Rupees Two Only) of GIPL to its wholly owned subsidiary viz. Gammon Power Limited . As a result of the said sale of shares, GIPL is now a step-down subsidiary of the Company.

As per the General Circular 08/2014 No. 1/19/2013-CL-V dated 4th April 2014 issued by the Ministry of Corporate Affairs, the financial statements (and documents required to be attached thereto), auditors report and board's report in respect of financial years that commenced earlier than 1st April 2014 shall be governed by the relevant provisions/Schedules/rules of the Companies Act, 1956. In view of the same the financial information of the Company's subsidiaries have been provided as per the provisions of the erstwhile Companies Act, 1956 and the applicable circulars issued thereunder.

The Ministry of Corporate Affairs, Government of India has, vide General Circular No. 2/2011 dated 8th February, 2011 read together with General Circular No. 3/2011 dated 21st February, 2011, granted exemption under Section 212(8) of the Companies Act, 1956, for not attaching Annual Report of subsidiary companies, subject to fulfillment of certain conditions by the holding company. As stated in the said circulars, the Board of Directors, vide its resolution dated 18th December 2014 accorded its consent for not attaching the balance sheet of the subsidiaries. Further the Company has presented in the Annual Report, the consolidated financial statements of the Company and all its subsidiaries duly audited by its statutory auditors. The consolidated financial statements have been prepared in strict compliance with the applicable Accounting Standards and, where applicable, the Listing Agreement as prescribed by the Securities and Exchange Board of India. The Company has disclosed in the consolidated balance sheet the following information in aggregate for each subsidiary including subsidiaries of subsidiaries:- (a) capital (b) reserves (c) total assets (d) total liabilities (e)details of investment (except in case of investment in the subsidiaries) (f) turnover (g) profit before taxation (h) provision for taxation (i) profit after taxation (j) proposed dividend.

8. CONSOLIDATED FINANCIAL STATEMENTS:

Your Directors have pleasure in attaching the Consolidated Financial Statements pursuant to Clause 32 of the Listing Agreement entered into with the Stock Exchanges and prepared in accordance with the Accounting Standards prescribed by the Institute of Chartered Accountants of India, in this regard and forms part of the Annual Report.

9. DIRECTORS' EXPLANATION ON AUDITOR'S REPORTS:

Directors explanation on the Auditors comments on the financial statements (both on Standalone and Consolidated) for the year ended 30th September 2014 as set out in their respective auditors reports of 5th December 2014 and 18th December 2014 is as follows:

(a) With reference to clause (e) of the "Basis of Qualified Opinion" in the Audit Reports on the Standalone Financial Statements wherein the auditors have opined that the Company has during the year after 1st April 2014 granted unsecured loans to one of its Joint Ventures beyond the limits specified in Section 186 of the Companies Act 2013 i.e. without the prior approval of the members in general meeting, the Board would like to inform you that, as explained in Note 12(vi) of the Standalone Financial Statements, the loan was given as a business exigency and in the ordinary course of business. The Company had entered into joint venture namely, Gammon Cidade Tensacciai Joint Venture (the "JV") with Construtora Cidade LTDA and Tensacciai S.p.A. for the purpose of execution of "Construction of bridge and its approaches over river Yamuna downstream of existing bridge of Wazirabad [SH: Main Bridge (Cable Stayed)] at Delhi" (the "Project"). The JV was required to import materials for the said Project. On account of business exigency, the Company had granted unsecured loan to the JV for purchasing the material. The said transaction amounted to giving of loan by the Company to the JV and though in the ordinary course of business, exceeded the limits prescribed under Section 186 of the Companies Act, 2013. The Directors would also like to inform you that the Company shall, in due course, obtain shareholders' approval for giving of loans/advances to its joint ventures/associates.

(b) With reference to clause (a) of the "Basis of Qualified Opinion" in the Audit Reports on both Standalone as well as Consolidated Financial Statements wherein the auditors have opined that they are unable to comment on the adequacy of the provisions made by the Company for diminution of the value of its investments due to non-availability of financials of Franco Tossi Mecanica S.p.A ("FTM") the Company's subsidiary in Italy, the Board, while drawing your attention to Note 33(c)(i) and (ii) of Standalone and in Note 1(a)(ii)(a) of Consolidated Financial Statements, would like to reiterate that FTM has filed an application for a pre-insolvency procedure which has been admitted by a court at Milan. In light of the ongoing procedure, till date, the financial statements of FTM have not been released by the empowered Commissioner. Further, it is envisaged that these will not be released until the process of insolvency is complete. However, the Company has made adequate provision towards its exposure for all the known liabilities in FTM. The management is of the opinion that since it will recover an amount not less than the carrying amount of FTM, no further provision for diminution is required to be made.

(c) With reference to clause (b) of the "Basis of Qualified Opinion" in the Audit Reports on both Standalone as well as Consolidated Financial Statements wherein the auditors have opined that "they are unable to comment on the adequacy of the provisions made towards the Company's exposure towards corporate guarantees issued towards the jobs of FTM", the Board would like to inform you that as mentioned in Note 33(c)(iii) of Standalone and in Note 1(a)(ii)(b) of Consolidated Financial Statements, the Company is in active negotiation with the clients of FTM for the cancellation of the demand of € 17.80 Million (Rs. 139.21 Crore) made by the Clients. Further, the Company has made provision for the balance amount of € 4.04 Million (Rs. 31.59 Crore).

(d) With reference to clause (c) of the "Basis of Qualified Opinion" in the Audit Reports on both Standalone as well as Consolidated Financial Statements wherein the auditors have opined that "they are unable to comment on the adequacy of the provisions made towards the Company's exposure in investments in and Guarantees given by the Company in respect of SAE Powerlines S.p.A ,the Company's subsidiary in Italy" the Board would like to inform you that as mentioned in Note 33(e) of Standalone and in Note 1(a)(v) of Consolidated Financial Statements, the management is of the opinion that considering the order book position and adequate references and strengths in international markets of its subsidiary SAE Powerlines the provision made by it for impairment of its investment, loans and trade receivables is adequate.

(e) With reference to clause(d) of the "Basis of Qualified Opinion" in the Audit Report on Standalone Financial Statements and Clause (e) of the "Basis of Qualified Opinion" in the Audit Report on Consolidated Financial Statements, wherein the auditors have opined on managerial remuneration , the Board would like to inform you that as mentioned in Note 24(a) of Standalone and in Note 24 of Consolidated Financial Statements, the Company's application for payment of 'Minimum Remuneration' of Rs. 6 Crore to Mr. Abhijit Rajan - Chairman & Managing Director for the financial years 2012-13 & 2013-14 was rejected by the Ministry of Corporate Affairs ("MCA"). The Company has made an application to the MCA for review of its decision and the MCA's reply in this matter is awaited. The Company had also made an application to the MCA for waiver of payment of 'Minimum Remuneration' of Rs. 2 Crore to Mr. Himanshu Parikh (Former Executive Director) for the financial year 2012-13. In response to the Company's said application, the MCA approved payment of 'Minimum Remuneration' of Rs. 1.66 Crore to Mr. Parikh. The Company has made a representation to the Ministry to reconsider its decision and reply is awaited. In view of the pending status of the aforementioned applications, no effect for the same has been given in the financial statements.

(f) With reference to clause (d) of the "Basis of Qualified Opinion"in the Audit Report on Consolidated Financial Statements wherein the auditors have reported that the financial statements of Sofinter S.p.A. ("Sofinter), Campo Puma Oriente S.A. ("CPO"), Ansaldo Caldaie Boilers (India) Limited, Gammon Holdings (Mauritius) Limited, Ansaldo Caldaie GB Engineering Limited and Gammon OJSC Mosmetrostroy Joint Venture are unaudited , the Board would like to inform you that as mentioned in Note 1(a)(i), 1(b)(iii) and Note 1(c) of Consolidated Financial Statements, the financial statements of these companies could not be audited due to insufficient time , unavailability of support staff and other severe administrative issues in these companies .Hence, the financial statements are as per management prepared accounts except in case of CPO & OJSC which were not audited on account of differences between the joint venture partners.

(g) With reference to clause (d) of the "Basis of Qualified Opinion"in the Audit Report on Consolidated Financial Statements wherein the auditors have reported about the non-recognition of possible claims on trade receivables of Europower S.p.A., a subsidiary of the Associate Sofinter S.p.A., the Board would like to inform you that as mentioned in Note 1(c)(i)(c) of Consolidated Financial Statements, Europower S.p.A. has initiated legal proceedings in the competent court in Italy, against their customer to recover the amount of Euro 3 Million i.e. Rs. 23.46 crore (Company's share being Euro 0.98 Million (Rs. 7.62 crore). Pending the outcome of the said litigation, the risk of non-recovery arising from the same has been provided by Europower S.p.A to the extent of 2.3 Million Euro i.e. Rs. 17.92 crore. Considering the current status of the legal proceedings, the Directors of the said Europower S.p.A. believe that Sofinter S.p.A. will not incur additional losses over and above the said amount.

(h) With reference to clause (d) of the "Basis of Qualified Opinion"in the Audit Report on Consolidated Financial Statements wherein the auditors have reported about non provision of trade receivables of Gammon & Billimoria LLC (GBLLC), Dubai a Subsidiary of the Company, the Board would like to inform you that as mentioned in Note 16(iv) of Consolidated Financial Statements, the amount is due from a Debtor of GBLLC which includes retention money aggregating to AED 2.7 million (Rs. 4.54 crore) due to GBLLC acting as a sub-contractor. The management of the said subsidiary is of the opinion that the amount is contractually recoverable and the subsidiary company is in negotiations with the principal client and in their opinion no provision is required to be made towards the same.

(i) With reference to second para of clause (d) of the "Basis of Qualified Opinion" in the Audit Report on Consolidated Financial Statements wherein the auditors have reported their inability to determine recoverability of an amount of Rs. 81.27 Crore in connection with legal proceedings initiated by the Company's subsidiaries viz. (i) Patna Buxar Projects Limited and (2) Mormugao Terminal Limited against unilateral termination of their respective concession agreements, the Board would like to inform you that since the management of the respective aforementioned companies is confident of recovery of the aforesaid amounts, no provision has been made in the accounts.

(j) With reference to clause (f) of the "Basis of Qualified Opinion" in the Audit Report on Consolidated Financial Statements, wherein the auditors have opined on encashment of bank guarantee of one of the subsidiaries viz. Patna Water Supply Distribution Network Private Limited, by the client and subsequent termination of the contract by the Client, the Board would like to inform you that since the said subsidiary believes that it has a good case against the Client, it has sought legal advice on the matter and hence the said encashment does not require any provision.

Members' attention is drawn to "Emphasis of Matter" stated in the Auditor's Report dated 5th December 2014 on the Standalone Financial Statements and in the Audit Report dated 18th December 2014 on the Consolidated Financial statements for the nine (9) months period ended 30th September 2014. The Directors would like to state that the said matters are for the attention of members only and have been explained in detail in the relevant notes to accounts as stated therein and hence require no further clarification.

10. AUDITORS:

The members had at the 92nd Annual General Meeting held on 30th June 2014, approved the appointment of:

(a) M/s. Natvarlal Vepari & Co., Chartered Accountants, Firm Registration no. 106971W, Statutory Auditors of the Company for the next three (3) financial years i.e. 2014-2015, 2015-16 and 2016-17; &

(b) M/s. Vinod Modi & Associates, Chartered Accountants, Firm Registration no. 111515W and M/s. M. G. Shah & Associates, Chartered Accountants, Firm Registration no. 112561W, as the Joint Branch Auditors of 'Gammon India Limited -Transmission& Distribution Business for the next five (5) financial years i.e. 2014-2015, 2015-16, 2016-17, 2017-18 and 2018-19.

Pursuant to Rule 3(7) of the Companies (Audit and Auditors) Rules, 2014, the aforesaid appointments need to be ratified by the members at the forthcoming Annual General Meeting. Accordingly, (i) the appointment of M/s. Natvarlal Vepari & Co., Chartered Accountants, as the Statutory Auditors of the Company to hold office from the conclusion of the meeting until the conclusion of the Annual General Meeting to be held for the financial year 2016-17 and (ii) the appointment of M/s. Vinod Modi & Associates, Chartered Accountants, Firm Registration no. 111515W and M/s. M. G. Shah & Associates, Chartered Accountants, Firm Registration no. 112561W, as the Joint Branch Auditors of 'Gammon India Limited -Transmission& Distribution Business, to hold office from the conclusion of the meeting until the conclusion of the Annual General Meeting to be held for the financial year 2018-19 is commended for ratification by the members.

A certificate from (i) M/s. Natvarlal Vepari & Co., Chartered Accountants, (ii) M/s. Vinod Modi & Associates, Chartered Accountants and (iii) M/s. M. G. Shah & Associates, Chartered Accountants, that their appointment is within the prescribed limits under Section 141 of the Companies Act, 2013 has been obtained.

11. COST AUDITOR :

Pursuant to the Cost Audit Order dated 24th January, 2012 issued by the Ministry of Corporate Affairs (MCA), the Board of Directors had appointed Mr. R. S. Raghavan, as the Cost Auditor for audit of cost accounting records of the transmission and distribution business for the nine (9) months period ended 30th September 2014. The report of the Cost Auditor will be filed with the MCA within the prescribed period. The Board, in its meeting held on 5th December 2014, has on the recommendation of the Audit Committee and subject to the approval of the Central Government approved the re-appointment of Mr. R. S. Raghavan as the Cost Auditor of the Company for the financial year commencing from 1st October 2014 for the applicable product of the transmission and distribution business.

12. REPORT ON CORPORATE GOVERNANCE AND MANAGEMENT DISCUSSION AND ANALYSIS:

Report on Corporate Governance and Management Discussion and Analysis Report for the year under review, together with a Certificate from the Auditors of the Company regarding compliance of the conditions of Corporate Governance, as stipulated under Clause 49 of the Listing Agreement forms part of the Annual Report.

13. DIRECTORS:

During the nine (9) months period ended 30th September 2014, Mr. Peter Gammon, Non-Executive Director (Chairman Emeritus) and Mr. Parvez Umrigar, Non-Executive Non-Independent Director resigned from the Company's Board with effect from 28th June 2014 and 31st July 2014 respectively. The Board places on record its sincere appreciation for the services rendered by Mr. Peter Gammon and Mr. Parvez Umrigar

The Board, at its meeting held on 18th December 2014, on the recommendation of the Nomination and Remuneration Committee, appointed/re-appointed the following directors:

1. Mr. Ajit B. Desai was appointed as the Whole-time Director of the Company designated as Executive Director & Chief Executive Officer for a period of three (3) years. The appointment of Mr. Desai as the Executive Director & Chief Executive Officer is subject to the approval of the CDR Lenders, the shareholders and the Central Government.

2. Mr. Rajul A. Bhansali was re-appointed as the Whole-time Director of the Company designated as Executive Director -International Operations for a further period of three (3) years. The re-appointment of Mr. Bhansali as the Executive Director - International Operations is subject to the approval of the shareholders and the Central Government.

14. DIRECTORS' RESPONSIBILITY STATEMENT:

Pursuant to Section 217 (2AA) of the Companies (Amendment) Act 2000, the Directors confirm that:

1. The applicable accounting standards have been followed by the Company in preparation of the annual accounts for the nine (9) months period ended 30th September 2014;

2. The Directors have selected accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at 30th September 2014 and of the Profit of the Company for the period ended on that date;

3. Proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Act and for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities;

4. The annual accounts for the nine (9) months period ended 30th September 2014 have been prepared on a going concern basis.

15. PARTICULARS OF EMPLOYEES:

The particulars of employees required to be furnished under Section 217(2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975, forms part of this Report. However, as per the provisions of Section 219(1)(b)(iv) of the Companies Act, 1956, the Report and Accounts are being sent to all shareholders, excluding the statement of particulars of employees. Any shareholder interested in obtaining a copy may write to the Company Secretary at the Registered Office of the Company.

16. PARTICULARS UNDER COMPANIES (DISCLOSURE OF PARTICULARS IN THE REPORT OF THE BOARD OF DIRECTORS) RULES, 1988:

A. Conservation of Energy:

"Energy conservation'' means to reduce the quantity of energy that is used for different purposes. This practice results in increase of financial capital, environmental value, national and personal security, and human comfort. Your Company is continuing with energy saving measures initiated earlier. Practices followed for conservation of Energy and efficient energy use are as follows:

> Constant monitoring of Diesel Consumption at the project sites.

> Replacement of diesel/fuel operated plant and machinery with electrically operated plant and machinery wherever possible at the project sites.

> Effective utilization of plant & machinery at the project sites.

The following initiatives taken at the Company's T&D Division at Nagpur to conserve energy and environment by reducing the consumption of non-renewable energy sources continue to be followed during the current year:

> Installation of drying oven for preheating of materials prior to galvanizing with the help of waste flue gases from galvanizing furnace which has reduced fuel consumption by 10%.

> Change in fuel from LDO to Ignite oil and from ignite oil to Liquefied Petroleum Gas through liquid offtake (LOT) system in galvanizing furnace reduces carbon deposition which minimizes breakdown, gives uniform heating to kettle thereby increasing the life & increase overall efficiency of the furnace.

> Maintaining power factor towards unity through capacitor bank.

> Transparent polycarbonate sheets provided at shop floor roof for usage of Natural light.

> Sewage Treatment Plant is installed to use waste water for gardening.

> Provided 85 Watt CFL in place of 250 Watts Metal Halide at finish yard Deoli works.

> Installed air operated diaphragm type pump instead of 10 HP electrical pump to save electrical power.

> Installed heat exchanger for heating of flux tank with the help of quench water.

B. Technology Absorption:

Timely completion of the projects as well as meeting the budgetary requirements are the two critical areas where different techniques help to a great extent. Many innovative techniques have been developed and put to effective use and the efforts to develop new techniques continue unabated.

C. Research and Development (R & D):

Increasing focus on developing infrastructure in the country has opened up many opportunities for the construction companies. In the continued difficult economic conditions, cost reductions and early completion of projects remains high on the agenda for every construction company. The opportunities for economizing the designs, improving the productivity, reducing wastage and adopting better construction practices leave a lot of scope for research and technology implementation. There is an urgent need to increase efforts for standardization of equipment, formwork, structural designs and construction procedures. The current market challenges makes it all the more important not to lose focus on the Research & Technology investments as innovating technologies are key to overcome the economic challenges.

To rise up to the challenge of completing huge quantum of work in a short time, we have to back up the onsite teams with continual improvement in construction technology. During the year under review the R&D activities undertaken by the company include:

> Designing high strength M60, M80 grade concrete for vertical pumping distance of 170 metres.

> Designing prestressed concrete for bridge superstructure with high early strength using Fly Ash as replacement of cement

> Designing concrete cooling systems for placing mass concrete at 10°C

> Designing & construction of composite well on sloping rock profile

> 3T Capacity cantilever platform with telescopic arrangement for material loading & shifting

> 1.5T capacity Movable Formwork Lifting Gantry for DAM construction

> Access stair tower 4 storied high on modular cantilever structural arrangement

> 7m cantilever structural cover at high-rise building for safety of pedestrian movement

> Designing, fabrication and erection methodology for Santacruz-Chembur Link Road Project (SCLR)-Phase-1- Section-II. Fabrication and Erection of 50.9 m long Steel Plate Girders (each girder weighing around 70 t).

17. ACKNOWLEDGEMENTS:

Your Directors thank all its valued customers and various Government, Semi-Government and Local Authorities, Suppliers and other Business associates. Your Directors appreciate continued support from Banks and Financial Institutions and look forward to their co-operation in the future. Your Directors place on record their appreciation of the dedicated efforts put in by the employees at all levels and wish to thank the Shareholders and all other stakeholders for their unstinted support and co-operation.

For and on behalf of the Board of Directors

ABHIJIT RAJAN

Chairman & Managing Director

Place: Mumbai

Dated: 18th December 2014