FC+BC - PVR Cinemas · 2018-12-15 · [email protected] Directors As per the provisions of...
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Transcript of FC+BC - PVR Cinemas · 2018-12-15 · [email protected] Directors As per the provisions of...
ReportDirectors’
Dear Shareholders,
Your directors are pleased to present the twelfth Annual Report and financial statements for the year ended
March 31, 2007.
Financial Overview(Rs. Lacs)
2006-07 2005-06
Income 17,196 10,602
Expenditure 13,933 8,709
Earnings before depreciation interest and tax (EBIDTA) 3,263 1,893
Depreciation 1,241 707
Interest 550 323
Profit before Tax 1,472 863
Provision for Taxation including Deferred Tax 419 315
Profit after Tax 1,053 548
Balance brought forward from previous year 1,339 885
Transfer from Debenture Redemption Reserve - 226
Profit available for appropriation 2,392 1,659
Appropriations
Interim Dividend
on Preference Shares 100 52
on Equity Shares 229 329 229 281
Corporate Dividend tax 46 39
Surplus carried to Balance Sheet 2,017 1,339
Financial ReviewTotal Income of the Company grew by 62% from Rs.10,602 lacs in previous year to Rs.17,196 lacs for the year
under review. Earnings before interest depreciation and tax (EBIDTA) increased from Rs.1,893 lacs in previous year
to Rs.3,266 lacs for the year under review, marking a growth of 73%.
Profit after Tax (PAT) increased by 93% from Rs.548 lacs in previous year to Rs.1,053 for the year under review.
Dividend
During the year under review your Directors declared and paid:
- 5% interim dividend on 20,000,000 Redeemable Preference Shares and
- 10% interim dividend on 22,915,370 Equity Shares of the Company
held by the respective shareholders of the Company as on 21st, March 2007, for the financial year 2006-07 .
14
which operated for a part of the year 2006-07 had lower occupancy levels as the same were in the process of stabilizing.
New Cinemas which commenced operationsDuring the year under review the Company commenced commercial operations from seven new multiplex projects
and one project became operational during the current financial year thereby adding 31 new screens under its operation.
Details of these new cinema properties added by the Company are as under :
Cinema Screens Seats Commencement date
PVR Juhu , Mumbai 5 1279 April 2006
PVR Indore 5 1199 April 2006
PVR Lucknow 4 874 April 2006
PVR Mulund, Mumbai 6 1815 June 2006
PVR Sahara Mall, Gurgaon 2 528 July, 2006
PVR Talkies, Aurangabad 3 1151 September 2006
PVR Talkies , Latur 3 1148 September 2006
PVR Vadodra 3 1096 May , 2007
Except the multiplexes at Gurgaon and Vadodra all the above projects have been granted exemption from the payment
of entertainment tax as per Entertainment Tax Exemption Policy of the respective State.
Your Company now operates and manages 82 screens across the country spread over Delhi, Haryana, Karnataka,
Uttar Pradesh, Andhra Pradesh, Maharashtra, Gujarat and Madhya Pradesh.
Employee Stock Option Scheme (ESOS)
During the Year, your Company has allotted 136,500 Equity Shares to the eligible employees of the company on
exercising the rights of stock options granted to them earlier in the preceding year.
The details of the shares issued under ESOS during the year under review is as follows:
38000 Equity shares allotted on January 31, 2007.
98500 Equity shares allotted on March 31, 2007.
Your Directors have recommended that these be treated as
the only dividends for the year.
Operations Review
During the year under review your Company had
launched a new brand of cinema called ‘PVR Talkies’ to
cater the demand of the cinema viewing public in class B &
C cities at a lower price range of Rs. 40 to Rs. 60 for an
enhanced movie viewing experience. The first of PVR
Talkies multiplexes were opened at Aurangabad and Latur in
the state of Maharashtra.
In current financial year, the Company has entered into
the business of Food Court by launching its first outlet at
Sahara Mall, Gurgaon, Haryana by the name of ‘PVR Food
Union’. This has increased the bouquet offering available to
the movie viewing Patrons who now have a better mix of
movies followed by variety of food offerings.
The growth in the Income was achieved through a
healthy mix of growth in Income of existing cinemas and
by opening of new cinemas.
The total number of
patrons who
watched movies at
our cinemas during
the year was
14.73 million, as
compared to 8.78 million in
the previous year. The average occupancy
in our cinemas during the year was 43% as compared to
46% in the previous year. The Occupancies of the cinemas
which operated for full year both in 2005-06 & 2006-07
increased from 46% to 49% however, new properties
Dear Shareholders,
Your directors are pleased to present the twelfth Annual Report and financial statements for the year ended
March 31, 2007.
Financial Overview(Rs. Lacs)
2006-07 2005-06
Income 17,196 10,602
Expenditure 13,933 8,709
Earnings before depreciation interest and tax (EBIDTA) 3,263 1,893
Depreciation 1,241 707
Interest 550 323
Profit before Tax 1,472 863
Provision for Taxation including Deferred Tax 419 315
Profit after Tax 1,053 548
Balance brought forward from previous year 1,339 885
Transfer from Debenture Redemption Reserve - 226
Profit available for appropriation 2,392 1,659
Appropriations
Interim Dividend
on Preference Shares 100 52
on Equity Shares 229 329 229 281
Corporate Dividend tax 46 39
Surplus carried to Balance Sheet 2,017 1,339
Financial ReviewTotal Income of the Company grew by 62% from Rs.10,602 lacs in previous year to Rs.17,196 lacs for the year
under review. Earnings before interest depreciation and tax (EBIDTA) increased from Rs.1,893 lacs in previous year
to Rs.3,266 lacs for the year under review, marking a growth of 73%.
Profit after Tax (PAT) increased by 93% from Rs.548 lacs in previous year to Rs.1,053 for the year under review.
Dividend
During the year under review your Directors declared and paid:
- 5% interim dividend on 20,000,000 Redeemable Preference Shares and
- 10% interim dividend on 22,915,370 Equity Shares of the Company
held by the respective shareholders of the Company as on 21st, March 2007, for the financial year 2006-07 .
14 15
The other details of ESOS as required under the SEBI
(Employee Stock Option Scheme and Employee Stock
Purchase Scheme) Guidelines, 1999 are annexed as
Annexure I hereto and forms part of this report.
Increase in Equity ShareCapital
Consequent upon the allotment of shares to the eligible
employees under the Employee Stock Option Scheme the
paid-up equity share capital of the Company has increased
from Rs. 22,87,73,700/- to Rs. 23,01,38,700/- divided
into 23013870 equity shares of Rs. 10 each.
Subsidiaries
As on March 31, 2007 the Company has two
subsidiary companies namely M/s PVR Pictures Limited
(PVR Pictures) and M/s C R Retail Malls (India) Private
Limited (CRR) in which it holds 100% shareholding. In
current financial year Company has also acquired the entire
share holding of M/s Sunrise Infotainment Private Limited
(SUNRISE) thereby making it wholly owned subsidiary of
the Company.
PVR Pictures Limited is engaged in the business of film
distribution and has therefore successfully distributed
various Hollywood and Hindi movies. PVR Pictures has got
its offices in Delhi, Mumbai, Bangalore, Indore and
Hyderabad and distributes movies in all territories in India
on its own or with the help of its associates.
PVR Pictures is now looking at making a bigger foothold
in the Hindi film distribution business and is exploring
options for alliances, tie ups with producers to exploit film
rights. PVR Pictures has during the year tied up with M/s
Aamir Khan Productions Private Limited to co-produce
two movies which are at present in an advance stage of
production. PVR Pictures shall additionally be distributing
these movies on pan India basis.
Your Company has also been deploying certain portion
of the IPO funds in the film distribution and film production
business as well in line with the shareholders approval.
M/s CR Retail Malls (India) Private Limited is
implementing the seven screens Multiplex Project at
The Phoenix Mills compound, Lower Parel, Mumbai,
a prime retail and entertainment destination in
Mumbai. The project is in advance stage and expected
to start commercial operation in third quarter of this
financial year.
Your Company has during the year deployed a portion
of IPO funds to enhance its Equity Capital exposure in this
subsidiary to Rs.2,000 lacs.
M/s Sunrise Infotainment Private Limited is
implementing the six screens Multiplex Project at Oberoi
Mall, Goregaon Mumbai. The Multiplex is a part of much
awaited mall development at the prime location of suburb
Mumbai.
The Company has obtained an exemption from the
Ministry of Corporate Affairs Government of India vide its
letter no. 47/277/2007-CL-3 dated 7th June, 2007 in
terms of Section 212(8) of the Companies Act, 1956
from attaching the audited accounts of its subsidiaries for
the financial year. In pursuance thereof, the Company
undertakes that annual accounts of the subsidiary
companies and the related detailed information for the year
ended March 31, 2007 will be made available to its
investors and subsidiary companies’ investors seeking such
information at any point of time. The annual accounts of the
subsidiary companies are also kept for inspection by any
investor at the registered office of the Company and
concerned subsidiary companies. The statement required
pursuant to the above referred approval letters is disclosed
after the Consolidated Accounts of the Company forming
part of this Annual Report.
Corporate Governance
It has always been your Company’s endeavor to excel
through good Corporate Governance practices. Corporate
governance is all about the effective management of
relationships among constituents of the system –
shareholders, management, employees, customers,
vendors, regulatory and the community at large. Your
Company strongly believes that this relationship can be
strengthened through corporate fairness, transparency and
accountability. Your Company complies with all the
provisions of revised clause 49 of the Listing Agreement.
The Corporate Governance Report in terms of Clause
49 of the Listing Agreement is attached and forms part of
this Annual Report.
The certificate from the Practicing Company Secretary
on the compliance of Corporate Governance Code
embodied in Clause 49 of the Listing Agreement is attached
and form part of this Annual Report.
Management Discussion andAnalysis Report
A detailed chapter on ‘Management Discussion
and Analysis’ pursuant to Clause 49 of the Listing
Agreement is annexed to the Annual Report and forms
part of this report.
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Investor Grievance mailaddress
Your Company has created the following e-mail ID for
redressing the Investor complaints:
Directors
As per the provisions of Section 255 and 256 of the
Companies Act, 1956, Mr. Renaud Jean Palliere retires by
rotation in the forthcoming Annual General Meeting and
being eligible, offers himself for re-appointment.
Fixed Deposits
During the year, the Company has not accepted any
fixed deposits from the public.
Auditors and Auditors’Report
The Statutory Auditors of the Company, M/s. S.R.
Batliboi & Co., Chartered Accountants, New Delhi, retire
at the conclusion of the ensuing Annual General Meeting of
the Company and are eligible for re-appointment and have
confirmed that their re-appointment if made, shall be within
the limits of Section 224(1B) of the Companies Act, 1956.
The Board recommends the re-appointment of M/s S.R.
Batliboi & Co., Chartered Accountants as Auditors of the
Company.
The comment given by the Auditors in the Annexure of
their report is self explanatory and therefore do not call for
any further comments under section 217 (3) of the
Companies Act, 1956.
Directors’ ResponsibilityStatement
Pursuant to the requirement under Section 217(2AA)
of the Companies Act, 1956, with respect to Directors’
Responsibility Statement, the Directors confirm:
i) That in the preparation of the annual accounts, the
applicable accounting standards have been followed and no
material departures have been made from the same;
ii) That they had selected such accounting policies and
applied them consistently and made judgements and
estimates that are reasonable and prudent so as to give true
and fair view of the state of affairs of the Company at the
end of the financial year and of the profit of the Company
for that period;
iii) That they had taken proper and sufficient care for the
maintenance of adequate accounting records in accordance
with the provisions of the Companies Act, 1956 for
safeguarding the assets of the Company and for preventing
and detecting fraud and other irregularities;
iv) That they had prepared the annual accounts on a going
concern basis.
Conservation of Energy,Technology Absorption,Foreign Exchange Earningand Outgo
A statement giving details of Conservation of Energy,
technology absorption, foreign exchange earnings, and
outgo, in accordance with Section 217(1)(e) of the
Companies Act, 1956 read with Companies (Disclosure
of Particulars in the Report of Board of Directors) Rules,
1988, is given as Annexure - II hereto and forms part of
this report.
Particulars of Employees
The statement of Particulars of Employees under
Section 217(2A) of the Companies Act 1956 and rules
framed thereto is given as Annexure III hereto and forms
part of this report.
Acknowledgement
Your Directors thank the Company’s customers /
patrons, vendors, investors and bankers for their continued
support during the year.
Your directors also place on record their deep
appreciation of the contribution made by the employees at
all levels. Your Company’s consistent growth was made
possible by their hard work, integrity, cooperation and
support.
On behalf of the Board
Ajay BijliChairman cum Managing Director
Place : Gurgaon, Haryana
Date : July 20, 2007
The other details of ESOS as required under the SEBI
(Employee Stock Option Scheme and Employee Stock
Purchase Scheme) Guidelines, 1999 are annexed as
Annexure I hereto and forms part of this report.
Increase in Equity ShareCapital
Consequent upon the allotment of shares to the eligible
employees under the Employee Stock Option Scheme the
paid-up equity share capital of the Company has increased
from Rs. 22,87,73,700/- to Rs. 23,01,38,700/- divided
into 23013870 equity shares of Rs. 10 each.
Subsidiaries
As on March 31, 2007 the Company has two
subsidiary companies namely M/s PVR Pictures Limited
(PVR Pictures) and M/s C R Retail Malls (India) Private
Limited (CRR) in which it holds 100% shareholding. In
current financial year Company has also acquired the entire
share holding of M/s Sunrise Infotainment Private Limited
(SUNRISE) thereby making it wholly owned subsidiary of
the Company.
PVR Pictures Limited is engaged in the business of film
distribution and has therefore successfully distributed
various Hollywood and Hindi movies. PVR Pictures has got
its offices in Delhi, Mumbai, Bangalore, Indore and
Hyderabad and distributes movies in all territories in India
on its own or with the help of its associates.
PVR Pictures is now looking at making a bigger foothold
in the Hindi film distribution business and is exploring
options for alliances, tie ups with producers to exploit film
rights. PVR Pictures has during the year tied up with M/s
Aamir Khan Productions Private Limited to co-produce
two movies which are at present in an advance stage of
production. PVR Pictures shall additionally be distributing
these movies on pan India basis.
Your Company has also been deploying certain portion
of the IPO funds in the film distribution and film production
business as well in line with the shareholders approval.
M/s CR Retail Malls (India) Private Limited is
implementing the seven screens Multiplex Project at
The Phoenix Mills compound, Lower Parel, Mumbai,
a prime retail and entertainment destination in
Mumbai. The project is in advance stage and expected
to start commercial operation in third quarter of this
financial year.
Your Company has during the year deployed a portion
of IPO funds to enhance its Equity Capital exposure in this
subsidiary to Rs.2,000 lacs.
M/s Sunrise Infotainment Private Limited is
implementing the six screens Multiplex Project at Oberoi
Mall, Goregaon Mumbai. The Multiplex is a part of much
awaited mall development at the prime location of suburb
Mumbai.
The Company has obtained an exemption from the
Ministry of Corporate Affairs Government of India vide its
letter no. 47/277/2007-CL-3 dated 7th June, 2007 in
terms of Section 212(8) of the Companies Act, 1956
from attaching the audited accounts of its subsidiaries for
the financial year. In pursuance thereof, the Company
undertakes that annual accounts of the subsidiary
companies and the related detailed information for the year
ended March 31, 2007 will be made available to its
investors and subsidiary companies’ investors seeking such
information at any point of time. The annual accounts of the
subsidiary companies are also kept for inspection by any
investor at the registered office of the Company and
concerned subsidiary companies. The statement required
pursuant to the above referred approval letters is disclosed
after the Consolidated Accounts of the Company forming
part of this Annual Report.
Corporate Governance
It has always been your Company’s endeavor to excel
through good Corporate Governance practices. Corporate
governance is all about the effective management of
relationships among constituents of the system –
shareholders, management, employees, customers,
vendors, regulatory and the community at large. Your
Company strongly believes that this relationship can be
strengthened through corporate fairness, transparency and
accountability. Your Company complies with all the
provisions of revised clause 49 of the Listing Agreement.
The Corporate Governance Report in terms of Clause
49 of the Listing Agreement is attached and forms part of
this Annual Report.
The certificate from the Practicing Company Secretary
on the compliance of Corporate Governance Code
embodied in Clause 49 of the Listing Agreement is attached
and form part of this Annual Report.
Management Discussion andAnalysis Report
A detailed chapter on ‘Management Discussion
and Analysis’ pursuant to Clause 49 of the Listing
Agreement is annexed to the Annual Report and forms
part of this report.
16 17
AnnexurAnnexurAnnexurAnnexurAnnexure – e – e – e – e – 11111 to Dirto Dirto Dirto Dirto Directorsectorsectorsectorsectors’’’’’ Report Report Report Report Report
Information regarding the Employees Stock Option Scheme(s) as on March 31, 2007
Sl. ParticularsNo.
1 Total number of Stock Options granted 170,000
2 Pricing Formula 118000@ Rs. 20/- and 52000@ Rs. 47.50/-
3 Options Vested during the year under review 136,500
4 Number of options exercised 136,500
5 Number of shares arising as a result of exercise of option 136,500
6 Number of option lapsed 33,500
7 Variation of terms of options N.A.
8 Money realized by exercise of options Rs. 3,885,000/-
9 Total number of options in force There are no options outstanding atthe year end.
10 Employee wise details of options granted to : i) Senior Managerial Personnel
(a) Mr. Pramod Arora 15250(b) Mr. N.C. Gupta 14500(c) Mr. Sunil Patil 10000(d) Mr. Amitabh Vardhan 20000(e) Mr. Ashish Saxena 8750(f) Mr. Ashish Shukla 11000
ii) Any other employee who receives a grant in any one year N.A.of option amounting to 5% or more of option granted duringthat year;
iii) Identified employees who were granted options, during any one year, N.A.equal to or exceeding 1% of the issued capital (excluding outstandingwarrants and conversions) of the Company at the time of grant.
11 Diluted Earnings Per Share (EPS) pursuant to issue of shares on Rs.4.12exercise of options calculated in accordance with AccountingStandard (AS) 20 ‘ Earning Per Share’
12 In case, the employees compensation cost is calculated on the basis of N.A.intrinsic value of stock option, the difference between the employeescompensation of the stock option cost based on intrinsic value of thestock and the employees compensation of the stock option cost basedfair value, and the impact of this difference on profits and on EPSof the Company
13 For options whose exercise price either equals or exceeds or is less thanthe market price of the stock the following are disclosed separately:a) Weighted average exercise price Rs.28.46b) Weighted average fair value -
14 A description of the method and significant assumptions used during theyear to estimate the fair value of options, including the followingweighted average information:i) risk free interest rate; 5.5%ii) expected life; 10.72 monthsiii) expected volatility; 8.61%iv) expected dividends andv) the price of the underlying shares in the Not Listed on the Grant Date,
market at the time of option grant. However valued at Rs.80/-18
AnnexurAnnexurAnnexurAnnexurAnnexure – e – e – e – e – 22222 to Dirto Dirto Dirto Dirto Directorsectorsectorsectorsectors’’’’’ Report Report Report Report Report
CONSERVATION OF ENERGY, TECHNOLOGY
ABSORPTION, FOREIGN EXCHANGE EARNINGS
AND OUTGO
Particulars required under Section 217(1) (e) of the
Companies Act, 1956, read with Rule 2 of the Companies
(Disclosure of Particulars in the Report of Board of
Directors) Rules, 1988 are as mentioned hereinbelow:
i) Conservation of Energy
Energy conservation measures taken:
• Power factor is being maintained above 0.95 with the
use of capacitor banks. These banks are used to neutralize
the inductive current by providing capacitive current. As a
result a power factor improves and gets rebate applicable
on energy bills from Electricity Distribution Companies
(Tata Power/BSES).
• Switching on/off procedure is being followed for entire
lighting and other load within the premises. Timers are
being used to ensure this.
• The air conditioning system preventive maintenance
routine services are monitored to make the system
efficient. Also regulation of the AHU timings for proper
utilisation has further helped in saving electricity
consumption.
• All the new fittings are with CFL or energy savers which
uses less electrical power as compared to old GL lamps
• Temperature sensors are being put in audi’s for better
control on AC
• Seat lights of LED’s are used in place of GSL light to save
energy
• Outside consultants have been appointed to suggest
energy saving measures over and above the existing
system. They will suggest on optimisation of energy
distribution, Lux level of various areas, design aspects of
electrical and HVAC system etc. so that other aspects of
energy conservation and equipment efficiency can be
maintained.
ii) Foreign Exchange Earnings & Outgo
March 31, 2007 March 31, 2006
Earnings in foreign currency (on accrual basis)
Income from Sale of Film Rights Nil 1,958,175
Expenditure in foreign currency (on accrual basis)
Traveling 892,881 484,431
Technical and Professional fees (including expenses, net of income tax) 5,690,411 13,520,343
Others 183,665 -
Total 6,766,957 14,004,774
CIF Value of Imports
Capital Goods 14,660,135 33,504,582
Software 2,832,926 527,736
Total 17,493,061 34,122,318
AnnexurAnnexurAnnexurAnnexurAnnexure – e – e – e – e – 11111 to Dirto Dirto Dirto Dirto Directorsectorsectorsectorsectors’’’’’ Report Report Report Report Report
Information regarding the Employees Stock Option Scheme(s) as on March 31, 2007
Sl. ParticularsNo.
1 Total number of Stock Options granted 170,000
2 Pricing Formula 118000@ Rs. 20/- and 52000@ Rs. 47.50/-
3 Options Vested during the year under review 136,500
4 Number of options exercised 136,500
5 Number of shares arising as a result of exercise of option 136,500
6 Number of option lapsed 33,500
7 Variation of terms of options N.A.
8 Money realized by exercise of options Rs. 3,885,000/-
9 Total number of options in force There are no options outstanding atthe year end.
10 Employee wise details of options granted to : i) Senior Managerial Personnel
(a) Mr. Pramod Arora 15250(b) Mr. N.C. Gupta 14500(c) Mr. Sunil Patil 10000(d) Mr. Amitabh Vardhan 20000(e) Mr. Ashish Saxena 8750(f) Mr. Ashish Shukla 11000
ii) Any other employee who receives a grant in any one year N.A.of option amounting to 5% or more of option granted duringthat year;
iii) Identified employees who were granted options, during any one year, N.A.equal to or exceeding 1% of the issued capital (excluding outstandingwarrants and conversions) of the Company at the time of grant.
11 Diluted Earnings Per Share (EPS) pursuant to issue of shares on Rs.4.12exercise of options calculated in accordance with AccountingStandard (AS) 20 ‘ Earning Per Share’
12 In case, the employees compensation cost is calculated on the basis of N.A.intrinsic value of stock option, the difference between the employeescompensation of the stock option cost based on intrinsic value of thestock and the employees compensation of the stock option cost basedfair value, and the impact of this difference on profits and on EPSof the Company
13 For options whose exercise price either equals or exceeds or is less thanthe market price of the stock the following are disclosed separately:a) Weighted average exercise price Rs.28.46b) Weighted average fair value -
14 A description of the method and significant assumptions used during theyear to estimate the fair value of options, including the followingweighted average information:i) risk free interest rate; 5.5%ii) expected life; 10.72 monthsiii) expected volatility; 8.61%iv) expected dividends andv) the price of the underlying shares in the Not Listed on the Grant Date,
market at the time of option grant. However valued at Rs.80/-18 19
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CS
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ars
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roup
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olle
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ora
te A
ffair
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ya E
xhib
ito
rs P
riva
teL
imite
d
Mr.
Am
itab
h V
ard
han
CO
O-
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ibitio
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pera
tio
ns-
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ibitio
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iplo
ma
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ote
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ear
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ear
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ust
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eve
rM
anag
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imite
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ma
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rain
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eve
lop
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ish S
hukl
aC
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igital
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era
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ns
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igital
BA
, D
iplo
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Gro
up o
f H
ote
lsH
ote
l M
anag
em
en
t,M
BA
Mr.
Ash
ish
Sak
sen
aC
OO
- Fi
lm C
ell
Pro
gram
min
g &
Dis
trib
utio
nB
.Tech
41
ye
ars
16
.11
.20
02
18
Ye
ars
3,2
63
,87
9In
ox
Leis
ure
Ltd
.
EM
PLO
YE
D F
OR
PA
RT
OF
TH
E Y
EA
R
Mr.
San
jay
Mal
ho
tra
Chie
f Fi
nan
cial
Offi
cer
Fin
ance
B C
om
(H
ons)
,4
2 y
ear
s1
9.1
1.2
00
11
9 y
ear
s3
,55
0,9
26
Pre
sid
ent
– D
imensi
on
FCA
Co
nsu
ltin
g P
riva
te L
td
Mr.
Gau
tam
Du
tta
Chie
f M
arke
ting
Offi
cer
Mar
keti
ng
BA
37
Ye
ars
05
.06
.20
06
19
Ye
ars
2,0
54
,76
1R
ediff
uss
ion D
ents
u Y
oung
& R
ub
icam
Pvt
. Ltd
.
Mr.
Vin
ay S
har
ma
Dir
ect
or,
H R
Hum
an R
eso
urc
eB
.Sc
, M
BA
56
Ye
ars
18
.09
.20
06
33
ye
ars
1,6
77
,04
0Se
lf Em
plo
yed,
Man
agem
en
t C
on
sultan
t
Mr.
Kam
alC
OO
PV
R P
ictu
res
Op
era
tio
n-
Dis
trib
utio
nB
.Co
m,
PG
DM
36
Ye
ars
01
.04
.20
02
10
ye
ars
2,0
47
,84
6Fu
n R
epublic
Gia
nch
and
ani
NO
TE
S:
1.
Gro
ss r
em
unera
tio
n c
om
pri
ses
of
Sal
ary,
Allo
wan
ces,
Co
mp
any’s
co
ntr
ibutio
n t
o P
rovi
dent
fund
and
tax
able
val
ue o
f p
erq
uis
ites.
2.
Exc
ep
t M
r. A
jay
Bijl
i (C
hai
rman
cum
Man
agin
g D
irect
or)
and
Mr.
San
jeev
Kum
ar (
Join
t M
anag
ing
Dir
ect
or)
, al
l o
ther
em
plo
yees
are o
n n
on-c
ontr
actu
al b
asis
.3
.N
one o
f th
e e
mplo
yees
mentio
ned a
bo
ve i
s a
rela
tive o
f an
y D
irect
or
of
the C
om
pan
y.4
.N
one o
f th
e e
mplo
yees
mentio
ned a
bo
ve h
old
s 2
% o
r m
ore
shar
e c
apita
l o
f th
e C
om
pan
y.5
.O
ther
term
s an
d c
onditi
ons-
NIL
20
21
ManagementDiscussion
&Analysis
Annexu
rAnnexu
rAnnexu
rAnnexu
rAnnexu
r e –
e –
e –
e –
e –
3333 3 to
Direct
ors’
Report
Info
rmat
ion a
s per
Sect
ion 2
17(2
A) o
f the C
om
pan
ies
Act
, 1956 r
ead
with
the C
om
pan
ies
(Par
ticula
rs o
f Em
plo
yees)
Rule
s, 1
975 r
efe
rred to
in th
e D
irect
ors
’ Repo
rt fo
r th
e y
ear
ended
Mar
ch 3
1, 2
007 a
nd fo
rmin
g par
t ther
eof o
f sho
win
g nam
es a
nd o
ther
par
ticula
rs o
f the
emplo
yees
who
wer
e em
plo
yed th
rough
out t
he
year
and w
ere
in rec
eipt o
fre
munera
tion fo
r th
e y
ear
in th
e a
ggre
gate
of n
ot l
ess
than
Rs.
24,0
0,0
00/-
or
no
t less
than
Rs.
2,0
0,0
00/-
per
mo
nth
in r
esp
ect
of t
ho
se w
ho
were
em
plo
yed fo
r par
t of t
he y
ear
.
Nam
eD
esi
gnat
ion
Nat
ure
of
Du
ties
Qu
alific
atio
ns
Age
Dat
e o
fTo
tal
Gro
ssP
revi
ou
s E
mp
loym
en
to
f th
e E
mp
loye
es
Co
mm
en
cem
en
texp
eri
en
ceR
em
un
era
tio
no
f E
mp
loym
en
t(i
n y
ear
s)(
in R
s.)
EM
PL
OY
ED
FO
R F
UL
L Y
EA
RM
r. A
jay
Bijl
iC
hai
rman
cu
mG
en
era
l M
anag
em
en
tB
.Co
m,
O P
M P
40
ye
ars
23
.04
.20
02
17
ye
ars
9,9
07
,20
0D
irect
or
- T
he A
mri
tsar
Man
agin
g D
ire
cto
r(H
arva
rd B
usi
ne
ssTr
ansp
ort
Co
mp
any
Sch
oo
l)P
riva
te L
imite
d
Mr.
San
jee
v K
um
arE
xecu
tive
Dir
ect
or
Ge
ne
ral
Man
age
me
nt
Bac
he
lor’
s D
egr
ee
35
ye
ars
24
.07
.20
03
12
ye
ars
5,2
63
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0D
irect
or
- P
riya
Exh
ibito
rsin
Fin
ance
&P
riva
te L
imite
dA
cco
unting,
MB
A
Mr.
Pra
mo
d A
rora
Pre
sid
ent
– C
orp
ora
teB
usi
ness
Deve
lop
ment
B.E
, M
BA
36
ye
ars
01
.12
.20
01
15
ye
ars
4,8
13
,03
2B
usi
ness
Deve
lop
ment
Str
ategy
and
Busi
ness
Man
age
r–
Pri
ya E
xhib
ito
rsD
eve
lop
men
tP
riva
te L
td.
Mr.
N.
C.
Gupta
Chie
f –
Lega
l an
dC
orp
ora
te A
ffair
sB
Co
m,
FCA
, A
CS
63
ye
ars
28
.08
.19
97
38
ye
ars
2,9
49
,44
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roup
Fin
anci
al C
ontr
olle
rC
orp
ora
te A
ffair
s–
Pri
ya E
xhib
ito
rs P
riva
teL
imite
d
Mr.
Am
itab
h V
ard
han
CO
O-
Exh
ibitio
nO
pera
tio
ns-
Exh
ibitio
nD
iplo
ma
in H
ote
l3
7 y
ear
s0
1.0
5.2
00
31
4 Y
ear
s3
,19
9,3
87
Ad
viso
r, H
ind
ust
an L
eve
rM
anag
em
en
t,L
imite
dD
iplo
ma
in T
rain
ing
& D
eve
lop
ment
Mr.
Ash
ish S
hukl
aC
EO
– D
igital
Op
era
tio
ns
- D
igital
BA
, D
iplo
ma
In3
5 Y
ear
s0
5.0
4.1
99
81
4 y
ear
s3
,56
8,5
67
Taj
Gro
up o
f H
ote
lsH
ote
l M
anag
em
en
t,M
BA
Mr.
Ash
ish
Sak
sen
aC
OO
- Fi
lm C
ell
Pro
gram
min
g &
Dis
trib
uti
on
B.T
ech
41
ye
ars
16
.11
.20
02
18
Ye
ars
3,2
63
,87
9In
ox
Leis
ure
Ltd
.
EM
PLO
YE
D F
OR
PA
RT
OF
TH
E Y
EA
R
Mr.
San
jay
Mal
ho
tra
Chie
f Fi
nan
cial
Offi
cer
Fin
ance
B C
om
(H
ons)
,4
2 y
ear
s1
9.1
1.2
00
11
9 y
ear
s3
,55
0,9
26
Pre
sid
ent
– D
imensi
on
FCA
Co
nsu
ltin
g P
riva
te L
td
Mr.
Gau
tam
Du
tta
Chie
f M
arke
ting
Offi
cer
Mar
keti
ng
BA
37
Ye
ars
05
.06
.20
06
19
Ye
ars
2,0
54
,76
1R
ediff
uss
ion D
ents
u Y
oung
& R
ub
icam
Pvt
. Ltd
.
Mr.
Vin
ay S
har
ma
Dir
ect
or,
H R
Hum
an R
eso
urc
eB
.Sc
, M
BA
56
Ye
ars
18
.09
.20
06
33
ye
ars
1,6
77
,04
0Se
lf Em
plo
yed,
Man
agem
en
t C
on
sultan
t
Mr.
Kam
alC
OO
PV
R P
ictu
res
Op
era
tio
n-
Dis
trib
utio
nB
.Co
m,
PG
DM
36
Ye
ars
01
.04
.20
02
10
ye
ars
2,0
47
,84
6Fu
n R
epublic
Gia
nch
and
ani
NO
TE
S:
1.
Gro
ss r
em
unera
tio
n c
om
pri
ses
of
Sal
ary,
Allo
wan
ces,
Co
mp
any’s
co
ntr
ibutio
n t
o P
rovi
dent
fund
and
tax
able
val
ue o
f p
erq
uis
ites.
2.
Exc
ep
t M
r. A
jay
Bijl
i (C
hai
rman
cum
Man
agin
g D
irect
or)
and
Mr.
San
jeev
Kum
ar (
Join
t M
anag
ing
Dir
ect
or)
, al
l o
ther
em
plo
yees
are o
n n
on-c
ontr
actu
al b
asis
.3
.N
one o
f th
e e
mplo
yees
mentio
ned a
bo
ve i
s a
rela
tive o
f an
y D
irect
or
of
the C
om
pan
y.4
.N
one o
f th
e e
mplo
yees
mentio
ned a
bo
ve h
old
s 2
% o
r m
ore
shar
e c
apita
l o
f th
e C
om
pan
y.5
.O
ther
term
s an
d c
onditi
ons-
NIL
20
The following Management Discussion and Analysis
Section should be read in conjunction with the financial
statements and notes to accounts for the period ended 31st
March, 2007. The reference to FY 07 and FY 06 in this
section refers to the year ended 31st March, 2007 and year
ended 31st March, 2006 respectively. This discussion
contains certain forward looking statements based on
current expectations, which entail various risks and
uncertainties that could cause the actual results to differ
materially from those reflected in them. All references to
“PVR”, “we”, “our”, “Company” in this report refer to PVR
Limited and should be construed accordingly.
Industry Outlook2006 was an excellent year for the Indian box office.
The top five films alone grossed over Rs. 3 billion. This
powered a total 21% growth in box office revenues in
2006 taking the estimated size of the Indian domestic box
office market to Rs. 64 billion. The domestic box office
market is expected to grow at a CAGR of 13% and nearly
double its size from Rs 64 Bn in 2006 to an estimated Rs.
119 billion over the next five years.
Overall, the size of the Indian film industry is estimated
at Rs. 85 billion, having grown by 24% from 2005. This
high increase was attributed to higher average ticket prices,
propelled by the growth of multiplexes. The Indian film
industry is expected to grow at a CAGR of 16% to Rs.
175 billion by 2011.
Projected growth of the Indian film Industry
Projected growth of the domestic box office
(Source: PWC –The Indian Entertainment and Media Industry Report 2007)
Rs. Bn
Rs. Bn
22
The following Management Discussion and Analysis
Section should be read in conjunction with the financial
statements and notes to accounts for the period ended 31st
March, 2007. The reference to FY 07 and FY 06 in this
section refers to the year ended 31st March, 2007 and year
ended 31st March, 2006 respectively. This discussion
contains certain forward looking statements based on
current expectations, which entail various risks and
uncertainties that could cause the actual results to differ
materially from those reflected in them. All references to
“PVR”, “we”, “our”, “Company” in this report refer to PVR
Limited and should be construed accordingly.
Industry Outlook
2006 was an excellent year for the Indian box office.
The top five films alone grossed over Rs. 3 billion. This
powered a total 21% growth in box office revenues in
2006 taking the estimated size of the Indian domestic box
office market to Rs. 64 billion. The domestic box office
market is expected to grow at a CAGR of 13% and nearly
double its size from Rs 64 Bn in 2006 to an estimated Rs.
119 billion over the next five years.
Overall, the size of the Indian film industry is estimated
at Rs. 85 billion, having grown by 24% from 2005. This
high increase was attributed to higher average ticket prices,
propelled by the growth of multiplexes. The Indian film
industry is expected to grow at a CAGR of 16% to Rs.
175 billion by 2011.
Projected growth of the Indian film Industry
Projected growth of the domestic box office
(Source: PWC –The Indian Entertainment and Media Industry Report 2007)
Rs. Bn
Rs. Bn
22 23
At a glance
Number of films produced in 2006 1,090
Number of single screens Approx. 12,000
Number of multiplex screens Approx. 325
Filmed Entertainment Industry Estimated at
Rs.84.5 billion in
2006;
Projected to grow
to Rs.175 billion by
2011
Domestic Box Office Market Estimated at Rs.64
billion in 2006;
Projected to grow
to Rs.119 billion by
2011
(Source: PWC –The Indian Entertainment and Media Industry
Report 2007)
Profit & Loss Review
Revenues
Total Revenue of the Company for the year under
review increased to Rs.17,196 lacs as compared to
Rs.10,602 lacs in previous year, registering a growth
of 60%.
Revenue Composition & Growth
The Net revenue composition for FY07 under various
heads was as under:
The revenue growth under various heads during the
year under review is summarised as under :
Rs. In Lakhs
FY 07 FY 06
Ticket Sales 12,169 8,801 38%
Income from Revenue Sharing 1,900 489 289%
Sale of Food and Beverages 3,735 2,401 56%
Royalty Income 159 120 32%
Advertisement Revenue 1,810 941 92%
Management fees 87 87 0 %
Sale of Film Rights 20
Gross Income from 19,860 12,858 54%
Operations
Less : Entertainment tax 2,915 2,244 30%
Less : Sales Tax / VAT 407 268 52%
Less : Service Tax 129 44 193%
Net Operating Income 16,409 10,302 59%
Other Income 787 300 162%
TOTAL INCOME 17,196 10,602 62%
Revenue from Sale of Tickets
Revenue from Sale of tickets is the total amount paid by
patrons for admission to our cinemas and includes state
entertainment taxes.
Our Revenue from Sale of tickets depends on the
number of patrons that visit our cinemas and the average
ticket price that we charge our patrons. Both these factors
are critical for optimising the profitability of our cinemas
and form an integral part of our management
information system.
Our Revenue from sale of tickets for the year under
review increased to Rs.12169 lacs as compared to
Rs.8801 lacs in previous year, registering a growth
of 38%.
The Company paid an entertainment tax of Rs.2915
lacs during FY 07 as compared to Rs.2244 lacs during the
FY 06. As a % of Gross Operating Income, the average tax
rate of the Company reduced from 17.5% in FY 06 to
14.7% in FY 07.
Income from Revenue Sharing
Income from revenue share represents revenue earned
by Company from multiplex properties being operated by
the company under a revenue share arrangement with the
developers. The Company presently operates 4 multiplex
properties at Ghaziabad, Mulund-Mumbai, Lucknow and
Indore under the present arrangement. The revenue from
ticket sales at these cinemas is accounted for on the basis of
the revenue share with the developer.
24
The total income from Revenue share for the year
under review increased to Rs.1900 lacs as compared
to Rs.489 lacs in previous year, registering a growth
of 289%.
Overall revenue from ticket sales and income from
revenue sharing for FY 07 was higher by 51% over
FY 06.
Food and Beverages Revenue
Gross revenue from sale of food and beverages is the
total amount paid by patrons at our in-cinema concession
stands for food and beverages and includes sales tax / value
added tax.
Our Gross food and beverages revenue (inclusive of
sales tax / value added tax), for the year under review
increased to Rs.3,735 lacs as compared to Rs.2,401 lacs
in previous year, registering a growth of 56%.
We generally try to maximize the revenues from the
sale of food and beverages by increasing the number of
transactions within the limited time our patrons have, prior
to the start of a film or during the interval of a film and by
increasing the average transaction size.
We attempt to increase the number of transactions by
installing adequate number of points of sale counters, meal
combos (combining 2 or more items as a ‘Combo’) and
service on seats. We attempt to increase our average
transaction size by selling a combination of two or more
products at a discounted price thereby appealing to our
patrons’ desire to obtain better value for money.
Royalty Income
Royalty income (pouring rights) is income received
from certain of our beverage suppliers for us agreeing not
to sell directly competing products. Our Royalty Income,
for the year under review increased to Rs.159 lacs as
compared to Rs.120 lacs in previous year, registering a
growth of 32%.
Advertisement Revenue
Advertisement revenue includes our revenue from on-
screen advertisements, off-screen advertisements and
cinema association.
Our Advertisement revenue, including service tax, for
the year under review increased to Rs.1810 lacs as
compared to Rs.941 lacs in previous year, registering a
growth of 92%.
We optimise the usage of interval and pre movie time,
to advertise, without compromising the overall movie
experience. We have also entered into multiple corporate
alliances with some of the leading brands, who find it quite
useful to advertise in our cinemas.
Management fee
Management fee includes
• Basic revenue share fee/ management fee for services
provided by us generally to the property developer in
relation to the multiplex, which is usually a percentage
of turnover.
• Incentive fee calculated as a percentage of gross
operating profit (before interest, depreciation and
management fee).
The Company presently operates two multiplex
properties at SRS PVR, Faridabad and Spice PVR, Noida
under a franchisee arrangement where it earns a
management fee revenue. Our Management fee Revenue,
amounting to Rs 87 Lacs was similar to that of the previous
year. The management fee revenues for FY 06 included
one time management income amounting to
Rs 40 Lacs for rendering project management, design and
consultancy services.
Other Income
Other income includes rent income from surplus space
within our cinemas that has been leased to third parties,
interest received on surplus operating cash flow and interest
income on investment of IPO proceeds in short term
investments, and other miscellaneous income.
Our other Income for the year under review increased to
Rs.787 lacs as compared to Rs.300 lacs in previous year,
registering a growth of 162%. The break-up of Other
Income for FY 07 and comparison with previous year is as
under :
(Rs. Lacs)
FY 2006-07 FY 2005-06 growth
Interest / Dividend income 592 168 252%
Rent Received 37 -
Royalty Income 47 54 -13%
Miscellaneous income 110 79 40%
Total 786 301 161%
Operating performance review
The operating performance has been analysed by
comparing property on property growth over FY 07 and
FY 06. For the above, the cinema properties have been
classified under Comparable properties, Non Comparable
properties and New properties. Comparable properties
represent cinemas which were operational during FY 07 &
FY 06. Non Comparable properties represent cinemas
which were operational for full year in FY 07 but only for a
part period during FY 06. New Properties represent
cinemas which commenced operations in FY 07.
24 25
The total income from Revenue share for the year
under review increased to Rs.1900 lacs as compared
to Rs.489 lacs in previous year, registering a growth
of 289%.
Overall revenue from ticket sales and income from
revenue sharing for FY 07 was higher by 51% over
FY 06.
Food and Beverages Revenue
Gross revenue from sale of food and beverages is the
total amount paid by patrons at our in-cinema concession
stands for food and beverages and includes sales tax / value
added tax.
Our Gross food and beverages revenue (inclusive of
sales tax / value added tax), for the year under review
increased to Rs.3,735 lacs as compared to Rs.2,401 lacs
in previous year, registering a growth of 56%.
We generally try to maximize the revenues from the
sale of food and beverages by increasing the number of
transactions within the limited time our patrons have, prior
to the start of a film or during the interval of a film and by
increasing the average transaction size.
We attempt to increase the number of transactions by
installing adequate number of points of sale counters, meal
combos (combining 2 or more items as a ‘Combo’) and
service on seats. We attempt to increase our average
transaction size by selling a combination of two or more
products at a discounted price thereby appealing to our
patrons’ desire to obtain better value for money.
Royalty Income
Royalty income (pouring rights) is income received
from certain of our beverage suppliers for us agreeing not
to sell directly competing products. Our Royalty Income,
for the year under review increased to Rs.159 lacs as
compared to Rs.120 lacs in previous year, registering a
growth of 32%.
Advertisement Revenue
Advertisement revenue includes our revenue from on-
screen advertisements, off-screen advertisements and
cinema association.
Our Advertisement revenue, including service tax, for
the year under review increased to Rs.1810 lacs as
compared to Rs.941 lacs in previous year, registering a
growth of 92%.
We optimise the usage of interval and pre movie time,
to advertise, without compromising the overall movie
experience. We have also entered into multiple corporate
alliances with some of the leading brands, who find it quite
useful to advertise in our cinemas.
Management fee
Management fee includes
• Basic revenue share fee/ management fee for services
provided by us generally to the property developer in
relation to the multiplex, which is usually a percentage
of turnover.
• Incentive fee calculated as a percentage of gross
operating profit (before interest, depreciation and
management fee).
The Company presently operates two multiplex
properties at SRS PVR, Faridabad and Spice PVR, Noida
under a franchisee arrangement where it earns a
management fee revenue. Our Management fee Revenue,
amounting to Rs 87 Lacs was similar to that of the previous
year. The management fee revenues for FY 06 included
one time management income amounting to
Rs 40 Lacs for rendering project management, design and
consultancy services.
Other Income
Other income includes rent income from surplus space
within our cinemas that has been leased to third parties,
interest received on surplus operating cash flow and interest
income on investment of IPO proceeds in short term
investments, and other miscellaneous income.
Our other Income for the year under review increased to
Rs.787 lacs as compared to Rs.300 lacs in previous year,
registering a growth of 162%. The break-up of Other
Income for FY 07 and comparison with previous year is as
under :
(Rs. Lacs)
FY 2006-07 FY 2005-06 growth
Interest / Dividend income 592 168 252%
Rent Received 37 -
Royalty Income 47 54 -13%
Miscellaneous income 110 79 40%
Total 786 301 161%
Operating performance review
The operating performance has been analysed by
comparing property on property growth over FY 07 and
FY 06. For the above, the cinema properties have been
classified under Comparable properties, Non Comparable
properties and New properties. Comparable properties
represent cinemas which were operational during FY 07 &
FY 06. Non Comparable properties represent cinemas
which were operational for full year in FY 07 but only for a
part period during FY 06. New Properties represent
cinemas which commenced operations in FY 07.
Footfalls
We entertained 14.73 million patrons at our cinemas
during FY 2007 as compared to 8.78 million patrons
during the FY 06, registering a growth of 68%.
The growth in footfalls was driven by a combination of
increase in footfalls in older cinemas and start of operations
of new cinemas.
We strive to increase the footfalls at our cinemas by
maximizing the number of screenings of popular movies to
increase our capacity (session seats), through bulk sales of
tickets, by providing remote access (our website,
telephones) to patrons for buying tickets, movie focused
marketing and promotional activities, flexible pricing keeping
in view demand patterns based on time of the day
(morning, afternoon, evening) and day of the week
(weekend – weekday). We also focus on our product
design and placement and the service levels to provide a
unique entertaining and hospitable environment to our
patrons.
FY 2006-07 FY 2005-06 Growth
Comparable properties 8.69 8.29 5 %
Non Comparable 2.69 0.49
properties
New Properties 3.35
Total 14.73 8.78 68%
Occupancy
The average occupancy across our cinema circuit during
FY 07 was as under:
FY 2006-07 FY 2005-06
Comparable properties 49% 46%
Non Comparable properties 64% 64%
New Properties 30%
Total 43% 46%
The Comparable properties have continued to show
an impressive growth in overall occupancy and average
occupancy across the properties is higher as compared to
last year levels.
The average occupancies at New properties opened by
the Company during the year are expected to stabilize over
the current year and move upwards. The company is
focused on aggressive promotions and pricing to drive
footfalls in newer markets.
Average Ticket Price
The average ticket prices across our cinema circuit during
FY 07 was as under :
FY 2006-07 FY 2005-06 Growth
Comparable properties 129 120 8 %
Non Comparable 109 97 12%
properties
New Properties 99
Total 119 119 0 %
The Comparable properties achieved an average ticket
price increase of 8% and Non Comparable properties
achieved an average ticket price increase of 12% during the
year under review.
The average ticket pricing at New properties of the
Company at Lucknow, Indore, Aurangabd & Latur is lower
than the existing average and hence the overall average
ticket pricing of the Company for FY 07 level is similar to
last year at Rs.119.
Spend per Head
The average spend per head across our cinema circuit
during FY 07 was as under :
(Rs.)
FY 2006-07 FY 2005-06 Growth
Comparable properties 32.2 30.5 6 %
Non Comparable 29.4 28.8 2 %
properties
New Properties 23.0
Total 28.0 30.0 -7%
The Comparable properties achieved an average
increase of 6% in spend per head and Non Comparable
properties achieved an average increase of 2% in spend per
head during the year under review.
Average spend per head New properties is lower due
to lower Spend per head in markets outside the metros of
Delhi, Mumbai, Bangalore and Hyderabad where the food
and beverage pricing and ticket pricing is also lower.
Expenditure
Our Company’s expenditure mainly comprises of
direct cost including Film Distributors’ share and
Consumption of food and beverages. Other costs include
Personnel Costs, Rent, Operating and other costs. Because
(Numbers in Mn)
(Rs.)
the majority of our costs are linked to the number of
patrons and the number of cinemas we operate, increase in
the number of patrons and the number of cinemas under
our operation have resulted in an increase in our total costs.
Film Distributors’ Share
Film Distributor share comprises of payments made to
distributors for supplying movies to be played at our
cinemas. Film hire cost as a % of Net Operating Income
for FY 07 was 27% as compared to 26.3% in FY 06.
Consumption of Food and Beverages
Food and Beverage cost comprise the cost of food and
beverage items sold at the cinemas and disposables. The
total cost of food and beverages consumed for the year
under review was Rs.1146 lacs as compared to Rs.
Rs.712 lacs in previous year. The average consumption of
food and beverages as a % of Food and beverage sales
(net of Sales tax / VAT) was 34.4% in FY 07 as compared
to 33.4% in FY 06. This was on account of lower average
spend per patron and higher F&B costs at new cinemas
opened by the Company in Aurangabad, Latur, Lucknow
and Indore.
Personnel Cost
Personnel cost is the expenditure incurred on
employees and comprises salaries, wages and allowances,
contributions to provident and other funds, gratuity
payments, staff welfare costs, and recruitment and training
costs. For our cinema staff, we have a group incentive
system for each of our cinemas, wherein we give monthly
incentives to our cinema staffs on their exceeding the
monthly targets of the cinemas managed by them. Total
Personnel costs for the year under review were Rs.1927
lacs as compared to Rs.1216 lacs in previous year. As a %
of net Revenue from operations, Personnel costs were
11.7% in FY 07 as compared to 11.8% in FY 06.
Till March 31, 2006 Company was providing for leave
benefits based on actuarial valuation in accordance with old
Accounting Standard 15. In the current year, the Company
has opted for early adoption of the Accounting Standard 15
(Revised 2005) which is otherwise mandatory for
accounting periods commencing on or after December 7,
2006. Accordingly the Company has changed the basis of
providing short term leave benefits. As a result,
actuarial valuation of leave as at April 1, 2006 is higher by
Rs. 2.70 Lacs (net of income-tax Rs. 1.37 Lacs) which in
accordance with the transitional provision in the revised
Accounting Standard, has been adjusted to the opening
balance of Profit and Loss Account. This change does not
have material impact on the profit for the current year.
ESOS
In terms of the ESOS Scheme , the Company has
alloted 38,000 and 98,500 equity shares in its Board
Meetings held on January 31, 2007 and March 31, 2007
respectively. Further, the Company has during the year
ended March 31, 2007 forfeited options equivalent to
33,500 shares on resignation of the concerned staff,
prior to vesting date of options given under Employee
Stock Option Scheme. As a result, the share capital
stands increased to 23,013,870 equity shares as on March
31st, 2007.
Accordingly, the amount expensed out on account of
the above for the year under review was Rs 29 Lakhs as
compared to Rs.70.5 lacs in previous year.
Operating and Other Expenses
Operating and other expenses include rent for our
cinemas and corporate office, repair and maintenance costs
relating to our cinemas, our corporate office and the
equipment installed thereon, security charges for third-
parties to provide security at our cinemas, electricity charges
and water charges, and insurance charges, expenditure on
advertisement and publicity and sales and business
promotion, expenditure incurred on various administrative
and other overheads such as travelling, printing &
stationery, professional fees, communication expenses,
bank charges and charges for prepayment of term loans.
The total Operating and other expenses for the year
under review was Rs. 6,351 lacs as compared to Rs. 3960
lacs in previous year, due to increase in number of cinema
properties. As a percentage of net operating revenue,
Operating and other expenses were 38.7% in FY 07, as
compared to 38.4% in FY 06.
Financial Expenses
Financial expenses for the year under review was
Rs.550 lacs as compared to Rs. 323 lacs in previous year.
As a percentage of net revenue from operations, Financial
expenses were increased to 3.3% in FY 07 as compared
to 3.1 % in FY 06.
Depreciation and Amortization
Depreciation and amortization for the year under
review was Rs. 1242 lacs as compared to Rs. 707 lacs in
previous year. This increase was due to the charging of
depreciation on fixed assets relating to our new cinemas
opened in fiscal FY 07 as well as full year impact of
properties which operated for a part of fiscal FY 06. As a
percentage of net revenue from operations, Depreciation
and amortization expenses were 7.5% in FY 07as
compared to 6.8% in FY 06.
Depreciation for the year under review is after reversal
of excess depreciation of Rs . 66 Lacs (Rs. 44 lacs net of
income tax) provided till last year.
Taxation
The Company provided Rs. 419 lacs as provision for
tax for the year under review after taking into consideration26
the majority of our costs are linked to the number of
patrons and the number of cinemas we operate, increase in
the number of patrons and the number of cinemas under
our operation have resulted in an increase in our total costs.
Film Distributors’ Share
Film Distributor share comprises of payments made to
distributors for supplying movies to be played at our
cinemas. Film hire cost as a % of Net Operating Income
for FY 07 was 27% as compared to 26.3% in FY 06.
Consumption of Food and Beverages
Food and Beverage cost comprise the cost of food and
beverage items sold at the cinemas and disposables. The
total cost of food and beverages consumed for the year
under review was Rs.1146 lacs as compared to Rs.
Rs.712 lacs in previous year. The average consumption of
food and beverages as a % of Food and beverage sales
(net of Sales tax / VAT) was 34.4% in FY 07 as compared
to 33.4% in FY 06. This was on account of lower average
spend per patron and higher F&B costs at new cinemas
opened by the Company in Aurangabad, Latur, Lucknow
and Indore.
Personnel Cost
Personnel cost is the expenditure incurred on
employees and comprises salaries, wages and allowances,
contributions to provident and other funds, gratuity
payments, staff welfare costs, and recruitment and training
costs. For our cinema staff, we have a group incentive
system for each of our cinemas, wherein we give monthly
incentives to our cinema staffs on their exceeding the
monthly targets of the cinemas managed by them. Total
Personnel costs for the year under review were Rs.1927
lacs as compared to Rs.1216 lacs in previous year. As a %
of net Revenue from operations, Personnel costs were
11.7% in FY 07 as compared to 11.8% in FY 06.
Till March 31, 2006 Company was providing for leave
benefits based on actuarial valuation in accordance with old
Accounting Standard 15. In the current year, the Company
has opted for early adoption of the Accounting Standard 15
(Revised 2005) which is otherwise mandatory for
accounting periods commencing on or after December 7,
2006. Accordingly the Company has changed the basis of
providing short term leave benefits. As a result,
actuarial valuation of leave as at April 1, 2006 is higher by
Rs. 2.70 Lacs (net of income-tax Rs. 1.37 Lacs) which in
accordance with the transitional provision in the revised
Accounting Standard, has been adjusted to the opening
balance of Profit and Loss Account. This change does not
have material impact on the profit for the current year.
ESOS
In terms of the ESOS Scheme , the Company has
alloted 38,000 and 98,500 equity shares in its Board
Meetings held on January 31, 2007 and March 31, 2007
respectively. Further, the Company has during the year
ended March 31, 2007 forfeited options equivalent to
33,500 shares on resignation of the concerned staff,
prior to vesting date of options given under Employee
Stock Option Scheme. As a result, the share capital
stands increased to 23,013,870 equity shares as on March
31st, 2007.
Accordingly, the amount expensed out on account of
the above for the year under review was Rs 29 Lakhs as
compared to Rs.70.5 lacs in previous year.
Operating and Other Expenses
Operating and other expenses include rent for our
cinemas and corporate office, repair and maintenance costs
relating to our cinemas, our corporate office and the
equipment installed thereon, security charges for third-
parties to provide security at our cinemas, electricity charges
and water charges, and insurance charges, expenditure on
advertisement and publicity and sales and business
promotion, expenditure incurred on various administrative
and other overheads such as travelling, printing &
stationery, professional fees, communication expenses,
bank charges and charges for prepayment of term loans.
The total Operating and other expenses for the year
under review was Rs. 6,351 lacs as compared to Rs. 3960
lacs in previous year, due to increase in number of cinema
properties. As a percentage of net operating revenue,
Operating and other expenses were 38.7% in FY 07, as
compared to 38.4% in FY 06.
Financial Expenses
Financial expenses for the year under review was
Rs.550 lacs as compared to Rs. 323 lacs in previous year.
As a percentage of net revenue from operations, Financial
expenses were increased to 3.3% in FY 07 as compared
to 3.1 % in FY 06.
Depreciation and Amortization
Depreciation and amortization for the year under
review was Rs. 1242 lacs as compared to Rs. 707 lacs in
previous year. This increase was due to the charging of
depreciation on fixed assets relating to our new cinemas
opened in fiscal FY 07 as well as full year impact of
properties which operated for a part of fiscal FY 06. As a
percentage of net revenue from operations, Depreciation
and amortization expenses were 7.5% in FY 07as
compared to 6.8% in FY 06.
Depreciation for the year under review is after reversal
of excess depreciation of Rs . 66 Lacs (Rs. 44 lacs net of
income tax) provided till last year.
Taxation
The Company provided Rs. 419 lacs as provision for
tax for the year under review after taking into consideration
the tax credit of Rs. 26 lacs for earlier years, as compared
to Rs. 315 lacs in the previous year. Of this Rs. 265 lacs
were towards current tax and Rs.180 lacs were towards
deferred tax. Our effective rate of tax was 28.46% in FY
07 and 36.5% in FY 06.
Key reasons for decrease in average rate of tax was tax
free dividend income earned by Company from investment
in mutual fund schemes and tax credit for earlier years.
Profits
The Profit before Interest Depreciation and Taxes of
the Company for the year under review increased to Rs.
3263 lacs as compared to Rs.1893 lacs in previous year,
registering a growth of 73%.
The Profit after Tax of the Company for the year under
review increased to Rs.1053 lacs as compared to Rs.548
lacs in previous year, registering a growth of 93%.
EPS
Basic Earnings per share (EPS) of the Company was
Rs.4.12 in FY 07 as compared to Rs. 2.62 in FY 06.
Diluted Earnings per share (EPS) of the Company was
Rs.4.12 in FY 07 as compared to Rs.2.62 in FY 06.
Balance Sheet ReviewShareholders Fund
The maintenance of an appropriate level of capital to
fund, the huge expansion plans of the Company remains
one of the major priorities of the management and the
same is subject to review on an ongoing basis. The
Entertainment Industry, especially the filmed entertainment
sector is poised for a major growth in the coming years and
your Company intends to play a major role in this space.
• Share Capital
The equity share capital of the Company comprises of
23,013,870 equity shares having face value of Rs.10 each
and 20,000,000 preference shares having face value of
Rs.10 each.
In terms of The ESOS Scheme , the Company has allotted
38,000 and 98,500 equity shares in its Board Meeting held on
January 31, 2007 and March 31, 2007 respectively. Further, the
Company has during the year ended March 31, 2007 forfeited
options equivalent to 33,500 shares on resignation of the
concerned staff, prior to vesting date of options given under
Employee Stock Option Scheme. As a result , the share capital
stands increased to 23,013,870 equity shares as on March
31st, 2007
• Reserves and Surplus
Reserves and Surplus comprised of Share Premium
account and Free Reserves of the Company.
The free reserves of the Company as on 31st March,
2007 were Rs. 2017 after providing for an interim dividend
of 10% on equity shares and a preference dividend of 5%
on preference shares.
Secured Loans
The Company availed loans from various banks and
institutions during the year, to fund its capital
expenditure requirements pending its initial public
offering of equity shares.
Changes in secured Loans during the year were as
under:
(Rs. Lacs)
Total Secured loans as on 1st April, 2006 6136
Fresh loans availed during the year 1000
Loans repaid during the year 1130
Total Loans as on 31st March 2007 6006
Unsecured Loans
The unsecured loans as on 31st March 2007 were NIL
Fixed Assets
The Company’s gross block stood at Rs.16978 lacs as
on 31st March, 2007, compared with Rs.10095 lacs as at
31st March, 2006. The increase was primarily due to fresh
capital investments in new multiplex projects and some
recurring capital expenditure at existing cinemas.
In addition, the Capital Work in Progress on various
projects under execution declined from Rs.4393 lacs in
2005-06 to Rs.1443 lacs in 2006-07 and Pre-operative
expenses pending capitalisation declined from Rs.1418 lacs
in 2005-06 to Rs.379 lacs in 2006-07.
Investments
The Company’s investments as on 31st March, 2007
were Rs. 6290 lacs and comprised of
• Investments in equity share capital of subsidiary
companies – M/s CR Retail Malls (India) Private Limited
Rs.2000 lacs and in M/s PVR Pictures Limited Rs.150 lacs;
• Investments in Mutual fund schemes Rs. 4084 lacs and
• Investments in National Savings Certificate schemes
Rs.56 lacs
Loans and Advances
The total loans and advances of the Company as on
31st March,2007 were Rs.6750 lacs as against Rs.5283
lacs as on 31st March, 2006. The increase in loans and
advances during the year was on account of payment of
deposits to various developers for new multiplex projects
being signed by the Company, advances given for various
projects under construction and an advance of Rs 118026 27
lacs given to M/s PVR Pictures Ltd, a 100% subsidiary of
the Company.
Working Capital
The Company has a negative working capital cycle.
Most of the Company’s revenue from ticket sales and food
and beverage sales at the cinemas is collected in cash. The
total working capital of the Company (excluding cash and
bank balances and Loans and Advances) as on 31st March,
2007 was negative Rs. 2,425 lacs as compared to negative
Rs.2442 lacs as on 31st March, 2006.
The amount of Current Liabilities and Provisions
predominantly represented the amount payable to
Company’s creditors for expenses incurred by the
Company pertaining to day to day operations, income
received in advance from sale of advertisement spaces at
Company’s multiplexes and project creditors who have
rendered services pertaining to Company’s multiplexes.
Internal control systems and their adequacy
The Company has proper and adequate systems of
internal controls in commensuration with the size of its
operations for various aspects of its business, which form
the backbone of our operational and internal controls.
Control over daily cash collections is done through an
effective cash management system, stocks are verified
regularly on a weekly basis. Bulk of our fixed assets are
typical to a cinema and do not involve frequent cross
location movements. We have a policy of physically verifying
fixed assets every alternate year.
The Company has effective systems in place for
ensuring, optimum and effective utilisation of resources,
monitoring thereof and compliance with applicable laws.
The Company has engaged M/s KPMG (Regd.) as its
internal auditors to carry out independent audits of our
operations, systems and processes.
In addition, the company tries to measure the
effectiveness of internal controls through internal audit
checks conducted by its own staff covering areas like safety,
security, stores, cash control, food and beverage sales etc.
In addition to the above, the Company has also hired an
external agency to review and audit the quality of service
and efficiency in operations at its cinemas. We also have a
formal mystery customer feedback system, acting as an
effective tool for bringing improvement in vrious aspects of
our business.
Outlook
The Company continues to be recognised by its
customers across the country as a preferred movie going
destination, preferred multiplex operator by leading mall
developers and the film industry. In view of this, the
company is making substantial capital investments to grow
horizontally and vertically by strengthening its presence in
film exhibition, distribution and production business besides
entering into innovative retail entertainment concepts.
With several opportunities yet to be tapped in the
filmed entertainment space, the Company expects to
derive a greater operating leverage out of its investments
with the objective of maximising shareholders’ wealth.
Cautionary Statement
Statements in the Management Discussion and Analysis
Report with regard to projections, estimates and
expectations have been made in good faith. Many
unforeseen factors may come into play and affect the actual
results, which could be different from what the
management envisages in terms of performance and
outlook. Market data and product information contained in
this report have been based on information gathered from
various published and unpublished reports and their
accuracy, reliability and completeness cannot be assured.
The management of the Company reserves the right to
revisit any of the predictive statements to decide the best
course of action for the maximisation of shareholders’
value apart from meeting social and human obligations.
28
29
ReportReportReportReportReportonononononCorporateCorporateCorporateCorporateCorporate
GovernanceGovernanceGovernanceGovernanceGovernance
lacs given to M/s PVR Pictures Ltd, a 100% subsidiary of
the Company.
Working Capital
The Company has a negative working capital cycle.
Most of the Company’s revenue from ticket sales and food
and beverage sales at the cinemas is collected in cash. The
total working capital of the Company (excluding cash and
bank balances and Loans and Advances) as on 31st March,
2007 was negative Rs. 2,425 lacs as compared to negative
Rs.2442 lacs as on 31st March, 2006.
The amount of Current Liabilities and Provisions
predominantly represented the amount payable to
Company’s creditors for expenses incurred by the
Company pertaining to day to day operations, income
received in advance from sale of advertisement spaces at
Company’s multiplexes and project creditors who have
rendered services pertaining to Company’s multiplexes.
Internal control systems and their adequacy
The Company has proper and adequate systems of
internal controls in commensuration with the size of its
operations for various aspects of its business, which form
the backbone of our operational and internal controls.
Control over daily cash collections is done through an
effective cash management system, stocks are verified
regularly on a weekly basis. Bulk of our fixed assets are
typical to a cinema and do not involve frequent cross
location movements. We have a policy of physically verifying
fixed assets every alternate year.
The Company has effective systems in place for
ensuring, optimum and effective utilisation of resources,
monitoring thereof and compliance with applicable laws.
The Company has engaged M/s KPMG (Regd.) as its
internal auditors to carry out independent audits of our
operations, systems and processes.
In addition, the company tries to measure the
effectiveness of internal controls through internal audit
checks conducted by its own staff covering areas like safety,
security, stores, cash control, food and beverage sales etc.
In addition to the above, the Company has also hired an
external agency to review and audit the quality of service
and efficiency in operations at its cinemas. We also have a
formal mystery customer feedback system, acting as an
effective tool for bringing improvement in vrious aspects of
our business.
Outlook
The Company continues to be recognised by its
customers across the country as a preferred movie going
destination, preferred multiplex operator by leading mall
developers and the film industry. In view of this, the
company is making substantial capital investments to grow
horizontally and vertically by strengthening its presence in
film exhibition, distribution and production business besides
entering into innovative retail entertainment concepts.
With several opportunities yet to be tapped in the
filmed entertainment space, the Company expects to
derive a greater operating leverage out of its investments
with the objective of maximising shareholders’ wealth.
Cautionary Statement
Statements in the Management Discussion and Analysis
Report with regard to projections, estimates and
expectations have been made in good faith. Many
unforeseen factors may come into play and affect the actual
results, which could be different from what the
management envisages in terms of performance and
outlook. Market data and product information contained in
this report have been based on information gathered from
various published and unpublished reports and their
accuracy, reliability and completeness cannot be assured.
The management of the Company reserves the right to
revisit any of the predictive statements to decide the best
course of action for the maximisation of shareholders’
value apart from meeting social and human obligations.
28
30
Company’s Philosophy onCorporate Governance
PVR has always believed that Corporate Governance is
more a way of business life than a mere legal compulsion. It
is the application of best management practices,
Compliance of law in true letter and spirit and adherence to
ethical standards for effective management discharge of
social responsibilities for sustainable development of all
stakeholders.
The Company has made a strong foundation for
making Corporate Governance a way of life by constituting
a Board with balanced mix of experts of eminence and
integrity, forming a core group of top level executives,
inducting competent professionals across organization and
putting in place best system, process and technology.
The Company is committed to pursue growth by
adhering to the highest standards of Corporate
Governance. The Company’s philosophy on Corporate
Governance is based on the following principles:
• Lay solid foundations for the management
• Structure the Board to add value
• Safeguard integrity in Company’s financial reporting
• Make timely and balanced disclosure
• Recognize and manage business risks
• Respect the right of shareholders
• Remunerate fairly and responsibly
• Legal and statutory compliance in its true spirit
• Highest importance to Investor Relations
• Adherence to Corporate ethics and Code of Conduct
Board of Directors
Composition of the Board
The current policy of the Company is to have an
appropriate mix of executive and independent directors on
the Board for effective management of the Company.
The Board of the Company is comprised of six
members, out of whom two members are Executive
Directors and four members are Non Executive Directors.
The Non Executive Directors bring in a wide range of skills
and experience to the Board. The resume of each of our
directors is available on the website of the Company at
www.pvrcinemas.com
The Company has an Executive Chairman and the
number of the independent directors is not less than half of
total number of Directors. The composition of the Board
is in conformity with Clause 49 of the Listing Agreement.
None of the Directors on the Board is a member of
more than 10 Committees and Chairman of more than
5 Committees (as specified in Clause 49), across all the
companies in which he is a Director.
The necessary disclosures regarding other directorships
and committee positions have been made by the Directors.
The Company’s definition of independent
directors
An Independent director shall mean a non-executive
director of the Company who:
a) apart from receiving director’s remuneration, does not
have any material pecuniary relation or transaction with the
Company, its promoters, its directors, its senior
management or its holding company, its subsidiaries and
associates that may affect independence of the director;
b) is not related to promoters or persons occupying
management positions at the Board level or at one level
below the Board;
c) has not been an executive of the Company in the
immediately preceding three financial years;
d) is not a partner or an executive or was not a partner or
an executive during the preceding three years, of any of the
following:
i) the statutory audit firm or the internal audit firm that is
associated with the Company, and
ii) the legal firm(s) and consulting firm(s) that have a
material association with the Company.
e) is not a material supplier, service provider or customer
or a lessor or lessee of the Company, which may affect
independence of the Director; and
f) is not a substantial shareholder of the Company i.e.
owning two percent or more of the block of voting
shares.
30 31
Company’s Philosophy onCorporate Governance
PVR has always believed that Corporate Governance is
more a way of business life than a mere legal compulsion. It
is the application of best management practices,
Compliance of law in true letter and spirit and adherence to
ethical standards for effective management discharge of
social responsibilities for sustainable development of all
stakeholders.
The Company has made a strong foundation for
making Corporate Governance a way of life by constituting
a Board with balanced mix of experts of eminence and
integrity, forming a core group of top level executives,
inducting competent professionals across organization and
putting in place best system, process and technology.
The Company is committed to pursue growth by
adhering to the highest standards of Corporate
Governance. The Company’s philosophy on Corporate
Governance is based on the following principles:
• Lay solid foundations for the management
• Structure the Board to add value
• Safeguard integrity in Company’s financial reporting
• Make timely and balanced disclosure
• Recognize and manage business risks
• Respect the right of shareholders
• Remunerate fairly and responsibly
• Legal and statutory compliance in its true spirit
• Highest importance to Investor Relations
• Adherence to Corporate ethics and Code of Conduct
Board of Directors
Composition of the Board
The current policy of the Company is to have an
appropriate mix of executive and independent directors on
the Board for effective management of the Company.
The Board of the Company is comprised of six
members, out of whom two members are Executive
Directors and four members are Non Executive Directors.
The Non Executive Directors bring in a wide range of skills
and experience to the Board. The resume of each of our
directors is available on the website of the Company at
www.pvrcinemas.com
The Company has an Executive Chairman and the
number of the independent directors is not less than half of
total number of Directors. The composition of the Board
is in conformity with Clause 49 of the Listing Agreement.
None of the Directors on the Board is a member of
more than 10 Committees and Chairman of more than
5 Committees (as specified in Clause 49), across all the
companies in which he is a Director.
The necessary disclosures regarding other directorships
and committee positions have been made by the Directors.
The Company’s definition of independent
directors
An Independent director shall mean a non-executive
director of the Company who:
a) apart from receiving director’s remuneration, does not
have any material pecuniary relation or transaction with the
Company, its promoters, its directors, its senior
management or its holding company, its subsidiaries and
associates that may affect independence of the director;
b) is not related to promoters or persons occupying
management positions at the Board level or at one level
below the Board;
c) has not been an executive of the Company in the
immediately preceding three financial years;
d) is not a partner or an executive or was not a partner or
an executive during the preceding three years, of any of the
following:
i) the statutory audit firm or the internal audit firm that is
associated with the Company, and
ii) the legal firm(s) and consulting firm(s) that have a
material association with the Company.
e) is not a material supplier, service provider or customer
or a lessor or lessee of the Company, which may affect
independence of the Director; and
f) is not a substantial shareholder of the Company i.e.
owning two percent or more of the block of voting
shares.
The table below sets out the names of directors, status and number of directorship held in other companies.
Name of the Category Shareholding Number Number of Committee2 No. of Board attendance
Director in the of other Memberships and Meetings at the last
Company Directorships1 Chairmanship in all attended AGM held
(No. of Companies including during the on Sept. 6,
Shares) PVR Limited year 2006
Member- Chairman-
ships ship
Ajay Bijli Promoter, 18172 2 1 - 7 Yes
Executive director
Sanjeev Kumar Executive director - 2 - - 6 Yes
Sumit Chandwani Non Executive, - 3 3 - 3 Yes
Nominee (ICICI
Venture Funds
Management
Company Ltd.)
Vikram Bakshi Independent - 4 1 - 4 Yes
Amit Burman Independent - 7 3 - 2 Yes
Renaud Jean Independent - - 1 - 1 No
Palliere3
1. The directorships held by the directors, as mentioned above, do not include the directorships held in foreign companies,
private limited companies and companies under Section 25 of the Companies Act.
2. The committees considered for the purpose are those prescribed under Clause 49(1)(C)(ii) of the Listing
Agreement(s) viz. Audit Committee and Investor Grievance Committee of Indian Public Limited Companies.
3. Mr. Renaud Jean Palliere was appointed as a member of the Audit Committee on March 31, 2007.
Number of Board Meetings
During the year under review Board met seven times
on April 24, 2006; May 15, 2006; July 31, 2006;
October 31, 2006; January 31, 2007; March 16, 2007
and March 31, 2007. and the maximum gap between any
two meetings did not exceed four months as stipulated
under clause 49.
Information available to the Board
The Board has complete access to all the relevant
information within the Company. The information regularly
supplied to the Board includes the following:
• Annual operating plans, budgets and any updates therein;
• Capital budgets and any updates therein;
• Quarterly results for the Company and its operating
divisions or business segments;
• Minutes of meetings of audit committee and other
committees of the Board;
• Information on recruitment/remuneration of senior
officers just below the Board level;
• Material show cause, demand, prosecution notices and
penalty notices, if any ;
• Fatal or serious accidents, dangerous occurrences;
• Any material default in financial obligations to and by the
Company or substantial non-payment for services provided
by the Company;
• Any issue, which involves possible public or product
liability claims of substantial nature, if any
• Details of any joint venture or collaboration agreement;
• Transactions involving substantial payment towards
goodwill, brand equity, or intellectual property.
• Significant labour problems and their proposed solutions.
• Sale of material nature of investments, subsidiaries,
assets, which is not in normal course of business.
• Material non-compliance of any regulatory, statutory listing
requirement and shareholders services such as non-
payment of dividend, delay in share transfer etc.
• Details of investment of surplus funds available with the
Company
• Minutes of the Board Meetings of the subsidiary
companies
32
The above information is generally provided as part of
the agenda papers of the Board meeting and /or is placed at
the table during the course of the meeting. The president
and other senior management staff are also invited to the
Board meetings to present reports on the Company’s
operations and internal control systems.
The Company in consultation with the Chairman,
prepares the agenda. All Board members are at liberty
to suggest agenda items for inclusion. The detailed
agenda is sent to the members a week before the Board
meeting date.
Remuneration of Directors
Executive Directors
The details of the remuneration and perquisites to the
Executive Directors are as under:
Mr. Ajay Bijli, Chairman cum Managing Director (CMD)
and Mr. Sanjeev Kumar, Executive Director of the company
were paid following remuneration and perquisites during
the year under review, value of which has been calculated as
per Income Tax Act, 1961 and approval whereof has been
granted by the Ministry of Company Affairs vide its letter
No. 2/50/2005-CL. VII dated August 16, 2005:
Mr. Ajay Bijli Mr. Sanjeev Kumar
Rs. Rs.
Basic Salary 57,60,000 30,60,000
Perquisites 41,73,600 22,29,600
Total 99,33,600 52,89,600
Perquisites include Company leased accommodation/
HRA, Company maintained car, Employer’s Provident Fund
contribution
Salient features of the agreements executed by the
Company with Mr. Ajay Bijli, Chairman cum Managing
Director and Mr. Sanjeev Kumar, Executive Director are as
follows:
Period of Appointment July 24, 2003 to July 23, 2008
Stock Options Nil
Incentives additionally The CMD and Executive
approved Director shall be additionally
entitled to performance based
incentive as approved by the
Board based on previous
year’s performance
Severance Pay Except where the agreement
is terminated without notice,
subject to the provisions of
the Companies Act, 1956,
the Company is required to
pay an all inclusive severance
pay equal to salary and perks
as defined above for the entire
remaining period of
employment or 12 months
whichever is higher.
Non Executive Directors
During the year under review, the Non- Executive
Directors of the company were paid remuneration for
attending meetings of the Board/Committee of the
Directors as follows:
Name of the Directors Remuneration Rs.
Mr. Amit Burman 100,000/-
Mr. Renaud Jean Palliere 20,000/-
Mr. Sumit Chandwani* 180,000/-
Mr. Vikram Bakshi 140,000/-
*Remuneration to Mr. Sumit Chandwani was paid to
ICICI Venture Funds Management Co. Ltd. by virtue of his
being a nominee Director.
The company does not have any direct pecuniary
relationship/transaction with any of its Non Executive
Directors
Code of Conduct
The Board has laid down a Code of Conduct for all
Board members and senior management of the Company,
which is also available on the website of the Company
www.pvrcinemas.com . All Board members and senior
management, that includes company executives who report
directly to the Chairman and executive directors, have
affirmed their compliance with the said Code. A declaration
signed by the Chief Executive Officer to this effect is
provided elsewhere in the Annual Report.
Committees of the BoardThe Board has constituted various committees for
smooth and efficient conduct of business. The minutes of
the meetings of the committees of directors are placed in
the succeeding Board meeting for the Board to take note
of the same.
Audit Committee
As on March 31, 2007, the Audit Committee
comprises of four directors all being Non Executive and
majority being Independent. The Chief Financial Officer and
the statutory auditors are the permanent invitees in the
Committee meetings.
32 33
The above information is generally provided as part of
the agenda papers of the Board meeting and /or is placed at
the table during the course of the meeting. The president
and other senior management staff are also invited to the
Board meetings to present reports on the Company’s
operations and internal control systems.
The Company in consultation with the Chairman,
prepares the agenda. All Board members are at liberty
to suggest agenda items for inclusion. The detailed
agenda is sent to the members a week before the Board
meeting date.
Remuneration of Directors
Executive Directors
The details of the remuneration and perquisites to the
Executive Directors are as under:
Mr. Ajay Bijli, Chairman cum Managing Director (CMD)
and Mr. Sanjeev Kumar, Executive Director of the company
were paid following remuneration and perquisites during
the year under review, value of which has been calculated as
per Income Tax Act, 1961 and approval whereof has been
granted by the Ministry of Company Affairs vide its letter
No. 2/50/2005-CL. VII dated August 16, 2005:
Mr. Ajay Bijli Mr. Sanjeev Kumar
Rs. Rs.
Basic Salary 57,60,000 30,60,000
Perquisites 41,73,600 22,29,600
Total 99,33,600 52,89,600
Perquisites include Company leased accommodation/
HRA, Company maintained car, Employer’s Provident Fund
contribution
Salient features of the agreements executed by the
Company with Mr. Ajay Bijli, Chairman cum Managing
Director and Mr. Sanjeev Kumar, Executive Director are as
follows:
Period of Appointment July 24, 2003 to July 23, 2008
Stock Options Nil
Incentives additionally The CMD and Executive
approved Director shall be additionally
entitled to performance based
incentive as approved by the
Board based on previous
year’s performance
Severance Pay Except where the agreement
is terminated without notice,
subject to the provisions of
the Companies Act, 1956,
the Company is required to
pay an all inclusive severance
pay equal to salary and perks
as defined above for the entire
remaining period of
employment or 12 months
whichever is higher.
Non Executive Directors
During the year under review, the Non- Executive
Directors of the company were paid remuneration for
attending meetings of the Board/Committee of the
Directors as follows:
Name of the Directors Remuneration Rs.
Mr. Amit Burman 100,000/-
Mr. Renaud Jean Palliere 20,000/-
Mr. Sumit Chandwani* 180,000/-
Mr. Vikram Bakshi 140,000/-
*Remuneration to Mr. Sumit Chandwani was paid to
ICICI Venture Funds Management Co. Ltd. by virtue of his
being a nominee Director.
The company does not have any direct pecuniary
relationship/transaction with any of its Non Executive
Directors
Code of Conduct
The Board has laid down a Code of Conduct for all
Board members and senior management of the Company,
which is also available on the website of the Company
www.pvrcinemas.com . All Board members and senior
management, that includes company executives who report
directly to the Chairman and executive directors, have
affirmed their compliance with the said Code. A declaration
signed by the Chief Executive Officer to this effect is
provided elsewhere in the Annual Report.
Committees of the Board
The Board has constituted various committees for
smooth and efficient conduct of business. The minutes of
the meetings of the committees of directors are placed in
the succeeding Board meeting for the Board to take note
of the same.
Audit Committee
As on March 31, 2007, the Audit Committee
comprises of four directors all being Non Executive and
majority being Independent. The Chief Financial Officer and
the statutory auditors are the permanent invitees in the
Committee meetings.
The terms of reference of the Audit committee are as
follows:
1. The powers of the Audit committee shall include the
following
a. To investigate any activity within its terms of reference.
b. To seek information from any employee.
c. To obtain outside legal or other professional advice.
d. To secure attendance of outsiders with relevant
expertise, if it considers necessary.
2. The role of the audit committee shall include the
following :
a. Oversight of the company’s financial reporting
process and the disclosure of its financial information to
ensure that the financial statement is correct, sufficient and
credible.
b. Recommending to the Board, the appointment,
re-appointment and, if required, the replacement or
removal of the statutory auditor and the fixation of
audit fees.
c. Approval of payment to statutory auditors for any other
services rendered by the statutory auditors.
d. Reviewing, with the management, the annual financial
statements before submission to the Board for approval.
e. Reviewing, with the management, the quarterly
financial statements before submission to the board for
approval;
f. Reviewing, with the management, performance of
statutory and internal auditors, and adequacy of the internal
control systems.
g. Reviewing the adequacy of internal audit function,
if any, including the structure of the internal audit
department, staffing and seniority of the official heading the
department, reporting structure coverage and frequency of
internal audit.
h. Discussion with internal auditors reqarding any
significant findings and follow up there on.
i. Reviewing the findings of any internal investigations by
the internal auditors into matters where there is
suspected fraud or irregularity or a failure of internal
control systems of a material nature and reporting the
matter to the Board.
j. Discussion with statutory auditors before the audit
commences, about the nature and scope of audit as well as
post-audit discussion to ascertain any area of concern.
k. To look into the reasons for substantial defaults in the
payment to the depositors, debenture holders,
shareholders (in case of non payment of declared
dividends) and creditors.
l. To review the functioning of the Whistle Blower
mechanism, in case the same is existing.
m. Carrying out any other function as is mentioned in the
terms of reference of the Audit Committee.
Composition and Attendance
Name of the No. of meetings
Director attended
Mr. Sumit Chandwani 3
Mr. Amit Burman 2
Mr. Vikram Bakshi 3
Mr. Renaud Jean Palliere* -
* Mr. Renaud Jean Palliere was appointed as member of
the Audit committee w.e.f. March 31, 2007.
During the year under review the Audit Committee
met four times on May 15, 2006; July 31, 2006;
October 31, 2006; January 31, 2007 and the maximum
gap between any two meetings did not exceed four
months as stipulated under clause 49.
Remuneration Committee
Terms of Reference
The remuneration committee of the Board consists
of three members, all of whom are independent
directors. The Remuneration committee has been
constituted for the determination of remuneration
packages of the Directors.
Composition
Name of the Director
Mr. Amit Burman
Mr. Vikram Bakshi
Mr. Renaud Jean Palliere
During the year ended March 31, 2007, no
Committee meeting was held as there was no proposal
for variation in the remuneration of Executive Directors.
The Remuneration policy of the Company is aimed at
rewarding performance, based on review of the
achievements on a regular basis. The remuneration paid
to the Executive Directors is recommended by the
Remuneration Committee and approved by the Board of
Directors in the Board meeting, subject to the subsequent
34
approval by the shareholders at the general meeting and
such other authorities as and when required.
Shareholders/Investors Grievance Committee
Terms of Reference
The Investors Grievance Committee focuses on
shareholders’ grievances and strengthening of investor
relations. It looks into various investor complaints like
transfer of shares, non-receipt of annual reports and
other such issues.
Composition and Attendance
The Investor Grievance Committee comprises of
three directors, two of whom are non-executive
directors.
Name of the No. of meetings
Director attended
Mr. Ajay Bijli 4
Mr. Amit Burman 1
Mr. Sumit Chandwani 3
During the year under review the Investors
Grievance Committee met four times on
May 15, 2006; July 31, 2006; October 31, 2006;
January 31, 2007.
The Company Secretary, being the Compliance
Officer, is entrusted with the responsibility, to look into
the redressal of the Shareholders and investors
complaints and report the same to the Investor
Grievance Committee.
Details of complaints/ queries received and resolved
during the financial year 2006-07 are as follows:
Nature of Complaints Number of Complaints/ Complaints/
complaints/ Queries Queries
Queries resolved pending
received during the Excess/
during the year during the
year year
Excess/Short payment of 1 1 -
Dividend
Non-receipt of Securities 1 1 -
Non-receipt of Annual 2 2 -
Report
Non-receipt of 4 4 -
Dividend Warrants
Non-receipt of Electronic 17 17 -
Credits
Receipt of Refund orders 36 36 -
for revalidations
Dematerialisation/ 37 37 -
Rematerialisation of
shares
Receipt of DDs against 44 44 -
Dividend warrants
Non-receipt of refund 45 45 -
orders
Receipt of DD against 79 79 -
Refund order from
Company/Bank
Miscellaneous 169 169 -
correspondence/
complaints
Total 435 435 -
Compensation Committee
Terms of Reference
The Compensation Committee has been constituted
for the purposes of administering and supervising the ESPS
and ESOS and for determination of all such matters
specified in the ESPS and ESOS.
Name of the Director
Mr. Vikram Bakshi
Mr. Amit Burman
Mr. Sumit Chandwani
During the year ended March 31, 2007, no
Committee meeting was held as no fresh options were
granted under PVR ESOS.
34 35
approval by the shareholders at the general meeting and
such other authorities as and when required.
Shareholders/Investors Grievance Committee
Terms of Reference
The Investors Grievance Committee focuses on
shareholders’ grievances and strengthening of investor
relations. It looks into various investor complaints like
transfer of shares, non-receipt of annual reports and
other such issues.
Composition and Attendance
The Investor Grievance Committee comprises of
three directors, two of whom are non-executive
directors.
Name of the No. of meetings
Director attended
Mr. Ajay Bijli 4
Mr. Amit Burman 1
Mr. Sumit Chandwani 3
During the year under review the Investors
Grievance Committee met four times on
May 15, 2006; July 31, 2006; October 31, 2006;
January 31, 2007.
The Company Secretary, being the Compliance
Officer, is entrusted with the responsibility, to look into
the redressal of the Shareholders and investors
complaints and report the same to the Investor
Grievance Committee.
Details of complaints/ queries received and resolved
during the financial year 2006-07 are as follows:
Nature of Complaints Number of Complaints/ Complaints/
complaints/ Queries Queries
Queries resolved pending
received during the Excess/
during the year during the
year year
Excess/Short payment of 1 1 -
Dividend
Non-receipt of Securities 1 1 -
Non-receipt of Annual 2 2 -
Report
Non-receipt of 4 4 -
Dividend Warrants
Non-receipt of Electronic 17 17 -
Credits
Receipt of Refund orders 36 36 -
for revalidations
Dematerialisation/ 37 37 -
Rematerialisation of
shares
Receipt of DDs against 44 44 -
Dividend warrants
Non-receipt of refund 45 45 -
orders
Receipt of DD against 79 79 -
Refund order from
Company/Bank
Miscellaneous 169 169 -
correspondence/
complaints
Total 435 435 -
Compensation Committee
Terms of Reference
The Compensation Committee has been constituted
for the purposes of administering and supervising the ESPS
and ESOS and for determination of all such matters
specified in the ESPS and ESOS.
Name of the Director
Mr. Vikram Bakshi
Mr. Amit Burman
Mr. Sumit Chandwani
During the year ended March 31, 2007, no
Committee meeting was held as no fresh options were
granted under PVR ESOS.
General Body Meetings
Details of the last three Annual General Meetings (AGMs) of the Company are as under:
Financial Day & Date Time Venue Special Resolutions passed
Year
2003-04 Wednesday, 11:00 A.M. 50, West Regal Building, -
September 29, Connaught Place,
2004 New Delhi – 110001
2004-05 Friday, 12:00 Noon 61, Basant Lok, -
September 30, Vasant Vihar,
2005 New Delhi – 110057
2005-06 Wednesday, 9:30 A.M. 61, Basant Lok, (i) Increasing the FII Shareholding
September 6, Vasant Vihar, limit under Foreign Exchange
2006 New Delhi - 110057 Management Act, 1999;
(ii) Utilization of IPO funds in a
manner other than that
mentioned in the prospectus.
Special Resolution passed during the year
through postal ballot:
During the year under review, the Company has
conducted a postal ballot for seeking approval of the
shareholders by way of Special Resolution in pursuance to
Section 192A of the Companies Act, 1956 and
Companies (Passing of the Resolution by Postal Ballot)
Rules, 2001.
The notice of the postal ballot was published in
Financial Express (English daily) and Jansatta (Vernacular
newspaper).
M/s Sameet Gambhir & Associates, Company
Secretaries, New Delhi were appointed as scrutinizer by
the Board. Mr. Sameet Gambhir had submitted his report
on January 24, 2007 and the results were declared by the
Company on January 25th 2007.
The summary of the results are as follows:
Particulars No. No. of %
Postal Shares
Ballot
Forms
Total postal ballot 489 17,893,370 78.21%
forms received (of total paid up
capital)
Less: Invalid postal 18 1,243 0.01% (of
ballot forms (as per postal ballots
register) received)
Net valid postal ballot 471 17,892,127 99.99% (of
forms (as per postal ballots
register) received)
Postal ballot forms 383 17,866,050 99.96% (of
with assent for valid postal
the Resolution ballots received)
Postal ballot forms 88 6,077 0.04% (of
with dissent for valid postal
the Resolution ballots received)
The Chairman after receiving the Scrutinizer’s report
announced that the Special Resolution as per the Postal
Ballot Notice was duly passed with requisite majority
and directed that the resolution be recorded in the
minutes book.
Subsidiary Companies
The revised clause 49 of the listing agreement defines
a “Material Non Listed Indian Subsidiary” as an unlisted
subsidiary, incorporated in India whose turnover or net
worth (i.e. paid up capital and free reserves) exceeds
20% of the consolidated turnover or net worth
respectively of the listed holding company and its
subsidiary in the immediately preceding accounting year.
We do not have any Material Non-Listed Indian
Subsidiary.
Disclosures
a) Related Party Transactions
There were no materially significant related party
transactions i.e. transactions of the company of material
nature, with its promoters, directors or the management
or their relatives, its subsidiaries etc. during the year, that
may have potential conflict with the interests of the
Company at large. All related party transactions have been
disclosed in the Notes to the Accounts appearing
elsewhere in this report.
36
b) Compliances made by the Company
There were no non-compliances during the last
three years by the Company of any matter related to
Capital Market.
There were no penalties imposed or strictures
passed on the Company by Stock Exchanges, SEBI or
any other Statutory Authority.
c) Compliance with this clause
The Company has complied with all the mandatory
requirements of Clause 49 of the Listing Agreement
entered into with the stock exchanges.
Management
The Management’s Discussion and Analysis Report is
given separately and forms part of this Annual Report.
CMD/CFO Certification
The Certificate from Mr. Ajay Bijli, CMD and
Mr. Nitin Sood, Vice President – Finance & Investor’s
Relations in terms of clause 49 (V) of the listing agreement
with the stock exchanges for the year under review as
placed before the Board is enclosed at the end of this
report.
Shareholders
a) Disclosures Regarding appointment /
re-appointment of Directors
The information as required under clause 49 (G) of the
Listing agreement with respect to the appointment / re-
appointment of the directors forms part of the explanatory
statement annexed with the Notice of the ensuing Annual
General Meeting and the same is attached with this report.
b) Means of Communication
The Company interacts with its shareholders through
multiple forms of corporate and financial communication
such as annual reports, result announcement and media
releases. These results are also made available at the web
site of the company www.pvrcinemas.com. The web site
also displays official news releases.
Our financial results are also posted on SEBI’s EDIFAR
System.
All material information about the Company is promptly
sent through facsimile to the Stock Exchanges where the
shares of the Company are listed.
The Annual Results of the Company were published in
the following newspapers :
News Papers Language Region
Financial Express English Delhi, Mumbai, Bangalore,
Hyderabad, Chennai,
Ahmedabad, Kolkata,
Chandigarh, Kochi
Jansatta Hindi Bihar, Jharkhand, Delhi,
Lucknow, Varanasi &
Meerut
General Shareholders’ Information
1. Annual General Meeting : 18th day of August 2007
10:30 A.M. at 61, Basant Lok,
Vasant Vihar,
New Delhi- 110057
2. Financial calendar : Tentative Schedule:
Accounting Year April to March
Adoption of Quarterly
Results for the Quarter
ended 3rd /4th Week of
June 30, 2007, July, 2007
September 30, 2007 October, 2007
December 31, 2007 January, 2008
March 31, 2008 May, 2008
3. Book Closure Date : 13.08.2007 to 18.08.2007
(both days inclusive)
4. Dividend Payment : No further Dividend has been
Date recommended.
5. Listing on stock : Bombay Stock Exchange Limited
exchanges (BSE)
National Stock Exchange of India
Limited (NSE)
6. Stock Code : BSE Script Code : 532689;
NSE Symbol : PVR
ISIN : INE191H01014
7. Market Price Data
Monthly High Low for the year under review
NSE BSE
Month High Low High Low
Apr 06 335 291 336 298
May 06 334 252 337 250
June 06 279 188 265 190
July 06 254 204 264 206
Aug 06 268 215 275 221
Sep 06 272 235 272 205
Oct 06 265 235 263. 234
Nov 06 275 231 268 231
Dec 06 255 209 257 210
Jan 07 259 223 260 222
Feb 07 244 165 243 175
Mar 07 184 149 196 148
36 37
b) Compliances made by the Company
There were no non-compliances during the last
three years by the Company of any matter related to
Capital Market.
There were no penalties imposed or strictures
passed on the Company by Stock Exchanges, SEBI or
any other Statutory Authority.
c) Compliance with this clause
The Company has complied with all the mandatory
requirements of Clause 49 of the Listing Agreement
entered into with the stock exchanges.
Management
The Management’s Discussion and Analysis Report is
given separately and forms part of this Annual Report.
CMD/CFO Certification
The Certificate from Mr. Ajay Bijli, CMD and
Mr. Nitin Sood, Vice President – Finance & Investor’s
Relations in terms of clause 49 (V) of the listing agreement
with the stock exchanges for the year under review as
placed before the Board is enclosed at the end of this
report.
Shareholders
a) Disclosures Regarding appointment /
re-appointment of Directors
The information as required under clause 49 (G) of the
Listing agreement with respect to the appointment / re-
appointment of the directors forms part of the explanatory
statement annexed with the Notice of the ensuing Annual
General Meeting and the same is attached with this report.
b) Means of Communication
The Company interacts with its shareholders through
multiple forms of corporate and financial communication
such as annual reports, result announcement and media
releases. These results are also made available at the web
site of the company www.pvrcinemas.com. The web site
also displays official news releases.
Our financial results are also posted on SEBI’s EDIFAR
System.
All material information about the Company is promptly
sent through facsimile to the Stock Exchanges where the
shares of the Company are listed.
The Annual Results of the Company were published in
the following newspapers :
News Papers Language Region
Financial Express English Delhi, Mumbai, Bangalore,
Hyderabad, Chennai,
Ahmedabad, Kolkata,
Chandigarh, Kochi
Jansatta Hindi Bihar, Jharkhand, Delhi,
Lucknow, Varanasi &
Meerut
General Shareholders’ Information
1. Annual General Meeting : 18th day of August 2007
10:30 A.M. at 61, Basant Lok,
Vasant Vihar,
New Delhi- 110057
2. Financial calendar : Tentative Schedule:
Accounting Year April to March
Adoption of Quarterly
Results for the Quarter
ended 3rd /4th Week of
June 30, 2007, July, 2007
September 30, 2007 October, 2007
December 31, 2007 January, 2008
March 31, 2008 May, 2008
3. Book Closure Date : 13.08.2007 to 18.08.2007
(both days inclusive)
4. Dividend Payment : No further Dividend has been
Date recommended.
5. Listing on stock : Bombay Stock Exchange Limited
exchanges (BSE)
National Stock Exchange of India
Limited (NSE)
6. Stock Code : BSE Script Code : 532689;
NSE Symbol : PVR
ISIN : INE191H01014
7. Market Price Data
Monthly High Low for the year under review
NSE BSE
Month High Low High Low
Apr 06 335 291 336 298
May 06 334 252 337 250
June 06 279 188 265 190
July 06 254 204 264 206
Aug 06 268 215 275 221
Sep 06 272 235 272 205
Oct 06 265 235 263. 234
Nov 06 275 231 268 231
Dec 06 255 209 257 210
Jan 07 259 223 260 222
Feb 07 244 165 243 175
Mar 07 184 149 196 148
8. Performance of PVR Share price in comparison to:
NSE NIFTY INDEX BSE SENSEX
9. Registrar and Transfer Agents :Karvy Computershare Private Limited (KCPL) Karvy House, 46, Avenue 4, Street, No.1, Banjara Hills,Hyderabad – 500 034, Tel : +91-40-233 12454, Fax : +91-40-2343 1551, Website : www.kcpl.karvy.com
10. Share Transfer System :Share transfers in physical form can be lodged with KCPL at the above mentioned address
11. (a) Distribution Schedule
PVR LIMITEDConsolidated Distribution Schedule as on March 31, 2007
Category No. of Cases % of Cases Total Shares Amount % of Amount(Amount)
1-5000 16237 98.049515% 876768 8767680 3.809737%
5001-10000 135 0.815217% 105040 1050400 0.456420%
10001-20000 62 0.374396% 92112 921120 0.400246%
20001-30000 31 0.187198% 76941 769410 0.334324%
30001-40000 15 0.090580% 54212 542120 0.235562%
40001-50000 14 0.084541% 67216 672160 0.292067%
50001-100000 21 0.126812% 154073 1540730 0.669479%
100001 & Above 45 0.271739% 21587508 215875080 93.802164%
Total 16560 100% 23013870 230138700 100%
(b) Shareholding pattern
Consolidated Shareholding Pattern as on March 31, 2007
Sl. No. Category No. of Cases Total Shares % to Equity
1 Promoters 3 9286351 40.35%
2 Foreign Institutional Investors 12 7175397 31.18%
3 Mutual Funds 10 4197723 18.24%
4 Resident Individuals 15717 1323657 5.75%
5 Bodies Corporates 346 624667 2.71%
6 Financial Institutions / Banks 2 347331 1.51%
7 HUF 330 33724 0.15%
8 Non-Resident Indian 95 18427 0.08%
9 Clearing Members 41 6356 0.03%
10 Trusts 4 237 0.00%
Total 16560 23013870 100%
38
12. Dematerialisation of shares and liquidity
Our Equity Shares are tradable in dematerialized form
since its listing. We have entered into agreement with both
the depositories viz. National Securities Depository Limited
(NSDL) and Central Depository Services (India) Limited
(CDSL) to facilitate trading in dematerialized form in India.
The breakup of Equity Share capital held with
depositories and in physical form is as follows:
Sl. Category No. of Total Shares % to Equity
No. Holders
1 Physical 463 38,73,694 16.83
2 NSDL 13,933 18,962,960 82.40
3 CDSL 2,164 177,216 0.77
Total 16,560 23,013,870 100.0
13. No GDRs / ADRs / Warrants or any Convertible
instruments have been issued by the Company during
the year.
14. Site Locations
Sl. Name of Site Address
No.
1 PVR - Saket Saket, New Delhi
2 PVR - Priya Vasant Vihar, New Delhi
3 PVR - Naraina Naraina, New Delhi
4 PVR - Vikaspuri Vikas Puri, New Delhi
5 PVR - Plaza Connaught Place, New Delhi
6 PVR - Rivoli Connaught Place, New Delhi
7 PVR - Metropolitan Gurgaon, Haryana
8 PVR – Crown Plaza Faridabad, Haryana
9 SRS - PVR Faridabad, Haryana
10 PVR - EDM Kaushambi, Ghaziabad, U.P.
11 PVR - Bangalore The Forum, Bangalore, Karnataka
12 PVR - Indore M.G. Road, Indore, M.P.
13 PVR - Sahara Ganj Sahara Ganj, Lucknow, U.P.
14 PVR - Juhu Juhu, Mumbai
15 PVR - Punjagutta Hyderabad, Andhra Pradesh
16 Spice PVR Noida, U.P.
17 PVR – Nirmal Lifestyle Mulund, Mumbai
18 PVR - Sahara Sahara Mall, Gurgaon, Haryana
19 PVR Talkies Latur, Maharashtra
20 PVR Talkies Aurangabad, Maharashtra
21 PVR Talkies Vadodara, Gujarat
15. Address for correspondence :
Mr. N.C. Gupta
Company Secretary
PVR Limited
Registered Office :
61, Basant Lok,
Vasant Vihar, New Delhi - 110057
Corporate Office :
Block 2A, IInd Floor,
DLF Corporate Park, DLF Qutab Enclave,
Gurgaon, Haryana – 122002
Investor grievance email : [email protected]
Tel : +91-124-2549300
Fax : + 91-124-2549309
Website : www.pvrcinemas.com
38 39
12. Dematerialisation of shares and liquidity
Our Equity Shares are tradable in dematerialized form
since its listing. We have entered into agreement with both
the depositories viz. National Securities Depository Limited
(NSDL) and Central Depository Services (India) Limited
(CDSL) to facilitate trading in dematerialized form in India.
The breakup of Equity Share capital held with
depositories and in physical form is as follows:
Sl. Category No. of Total Shares % to Equity
No. Holders
1 Physical 463 38,73,694 16.83
2 NSDL 13,933 18,962,960 82.40
3 CDSL 2,164 177,216 0.77
Total 16,560 23,013,870 100.0
13. No GDRs / ADRs / Warrants or any Convertible
instruments have been issued by the Company during
the year.
14. Site Locations
Sl. Name of Site Address
No.
1 PVR - Saket Saket, New Delhi
2 PVR - Priya Vasant Vihar, New Delhi
3 PVR - Naraina Naraina, New Delhi
4 PVR - Vikaspuri Vikas Puri, New Delhi
5 PVR - Plaza Connaught Place, New Delhi
6 PVR - Rivoli Connaught Place, New Delhi
7 PVR - Metropolitan Gurgaon, Haryana
8 PVR – Crown Plaza Faridabad, Haryana
9 SRS - PVR Faridabad, Haryana
10 PVR - EDM Kaushambi, Ghaziabad, U.P.
11 PVR - Bangalore The Forum, Bangalore, Karnataka
12 PVR - Indore M.G. Road, Indore, M.P.
13 PVR - Sahara Ganj Sahara Ganj, Lucknow, U.P.
14 PVR - Juhu Juhu, Mumbai
15 PVR - Punjagutta Hyderabad, Andhra Pradesh
16 Spice PVR Noida, U.P.
17 PVR – Nirmal Lifestyle Mulund, Mumbai
18 PVR - Sahara Sahara Mall, Gurgaon, Haryana
19 PVR Talkies Latur, Maharashtra
20 PVR Talkies Aurangabad, Maharashtra
21 PVR Talkies Vadodara, Gujarat
15. Address for correspondence :
Mr. N.C. Gupta
Company Secretary
PVR Limited
Registered Office :
61, Basant Lok,
Vasant Vihar, New Delhi - 110057
Corporate Office :
Block 2A, IInd Floor,
DLF Corporate Park, DLF Qutab Enclave,
Gurgaon, Haryana – 122002
Investor grievance email : [email protected]
Tel : +91-124-2549300
Fax : + 91-124-2549309
Website : www.pvrcinemas.comDECLARATION REGARDING COMPLIANCE BY BOARD MEMBERS AND SENIOR MANAGEMENT
PERSONNEL WITH THE COMPANY’S CODE OF CONDUCT, PURSUANT TO CLAUSE 49 OF THE LISTING
AGREEMENT.
It is hereby declared that all Board Members and senior management personnel have affirmed compliance with the Code
of Conduct for the Directors and Senior Management in respect of Financial Year ended March 31, 2007.
Place : Gurgaon, Haryana Ajay BijliDate : June 6, 2007 Chairman CUM Managing Director
CMD’sDeclaration
40
We, Ajay Bijli , CMD, and Nitin Sood, Vice-President - Finance & Investor’s Relations, PVR Limited, to the best of our
knowledge and belief, certify that :
1. We have reviewed the financial statements and cash flow statements for the year and to the best of our knowledge and
belief:
(i) these statements do not contain any materially untrue statement or omit any material fact or contain statements that
might be misleading;
(ii) these statements together present a true and fair view of the Company’s affairs and are in compliance with existing
accounting standards, applicable laws and regulations.
2. To the best of our knowledge and belief, no transactions entered into by the Company during the year are fraudulent,
illegal or violative of the Company’s code of conduct;
3. We are responsible for establishing and maintaining internal controls for financial reporting and have evaluated the
effectiveness of internal control systems of the Company pertaining to financial reporting and have disclosed to the Auditors
and Audit Committee, wherever applicable:
a) Deficiencies in the design or operation of internal controls, if any, which come to our notice and steps have been taken /
proposed to be taken to rectify these deficiencies;
b) Significant changes in internal control over financial reporting during the year;
c) Significant changes in accounting policies during the year and that the same have been disclosed in the notes to the
financial statements;
d) Instances of significant fraud of which they have become aware and the involvement therein, if any, of the management
or an employee having a significant role in the Company’s internal control system over financial reporting
Place : Gurgaon, Haryana Ajay Bijli Nitin SoodDate : June 6, 2007 Chairman cum Managing Director Vice-President —
Finance & Investor’s Relations
CMD and CFO’sCertification
40 41
We, Ajay Bijli , CMD, and Nitin Sood, Vice-President - Finance & Investor’s Relations, PVR Limited, to the best of our
knowledge and belief, certify that :
1. We have reviewed the financial statements and cash flow statements for the year and to the best of our knowledge and
belief:
(i) these statements do not contain any materially untrue statement or omit any material fact or contain statements that
might be misleading;
(ii) these statements together present a true and fair view of the Company’s affairs and are in compliance with existing
accounting standards, applicable laws and regulations.
2. To the best of our knowledge and belief, no transactions entered into by the Company during the year are fraudulent,
illegal or violative of the Company’s code of conduct;
3. We are responsible for establishing and maintaining internal controls for financial reporting and have evaluated the
effectiveness of internal control systems of the Company pertaining to financial reporting and have disclosed to the Auditors
and Audit Committee, wherever applicable:
a) Deficiencies in the design or operation of internal controls, if any, which come to our notice and steps have been taken /
proposed to be taken to rectify these deficiencies;
b) Significant changes in internal control over financial reporting during the year;
c) Significant changes in accounting policies during the year and that the same have been disclosed in the notes to the
financial statements;
d) Instances of significant fraud of which they have become aware and the involvement therein, if any, of the management
or an employee having a significant role in the Company’s internal control system over financial reporting
Place : Gurgaon, Haryana Ajay Bijli Nitin SoodDate : June 6, 2007 Chairman cum Managing Director Vice-President —
Finance & Investor’s Relations
CMD and CFO’sCertification
Certificate on compliance with the conditions of
Corporate Governance under Clause 49 (as amended) of theListing Agreement.
To the Members of PVR Limited
1. We have reviewed the implementation of Corporate Governance procedures by PVR Limited during the period ended
March 31, 2007 with the relevant records and documents maintained by the Company, furnished to us for our review and
the report on Corporate Governance as approved by the Board of Directors.
2. The compliance of conditions of Corporate Governance is the responsibility of the management. Our examination was
limited to a review of procedures and implementation thereof, adopted by the Company for ensuring the compliance of
the conditions of Corporate Governance. It is neither an audit nor an expression of opinion on the financial statements of
the Company.
3. We further state that such compliance is neither an assurance as to the future viability of the Company nor the efficiency
or effectiveness with which the management has conducted the affairs of the Company.
4. In our opinion and to the best of our information and according to the explanations given to us, we certify that the
Company has in all respect complied with the conditions of Corporate Governance as stipulated in Clause 49 (as
amended) of the listing agreements with the stock exchanges and that no investor grievance is pending for a period
exceeding one month against the Company as per the records maintained by the Investors’ Grievance Committee.
For Pradeep Debnath & Co.Company Secretaries
Pradeep Debnath(Proprietor)
Place : New Delhi M. No.:20020, C.P. No.:7313
Date : June 6, 2007
42
StandaloneFinancial
statements
42 43
1. We have audited the attached balance sheet of PVR
Limited as at March 31, 2007 and also the profit and loss
account and the cash flow statement for the year ended on
that date annexed thereto. These financial statements are
the responsibility of the Company’s management.
Our responsibility is to express an opinion on these
financial statements based on our audit.
2. We conducted our audit in accordance with auditing
standards generally accepted in India. Those Standards
require that we plan and perform the audit to obtain
reasonable assurance about whether the financial
statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the
amounts and disclosures in the financial statements. An
audit also includes assessing the accounting principles used
and significant estimates made by management, as well as
evaluating the overall financial statement presentation.
We believe that our audit provides a reasonable basis for
our opinion.
3. As required by the Companies (Auditor’s Report)
Order, 2003 (as amended) issued by the Central
Government of India in terms of sub-Section (4A) of
Section 227 of the Companies Act, 1956, we enclose in
the Annexure a statement on the matters specified in
paragraphs 4 and 5 of the said Order.
4. Further to our comments in the Annexure referred to
above, we report that:
i. We have obtained all the information and explanations
which to the best of our knowledge and belief were
necessary for the purposes of our audit;
ii. In our opinion proper books of account as required by
law have been kept by the Company so far as appears from
our examination of those books;
iii. The balance sheet, profit and loss account and cash flow
statement dealt with by this report are in agreement with
the books of account;
iv. In our opinion, the balance sheet, profit and loss account
and cash flow statement dealt with by this report comply
with the accounting standards referred to in sub-section
(3C) of Section 211 of the Companies Act, 1956.
v. On the basis of written representations received from the
directors as on March 31, 2007, and taken on record by the
Board of Directors, we report that none of the directors is
disqualified as on March 31, 2007 from being appointed as a
director in terms of clause (g) of sub-section (1) of Section
274 of the Companies Act, 1956.
vi. In our opinion and to the best of our information and
according to the explanations given to us, the said
statements of account give the information required by the
Companies Act, 1956, in the manner so required and give
a true and fair view in conformity with the accounting
principles generally accepted in India;
a) in the case of the balance sheet of the state of affairs of
the Company as at March 31, 2007;
b) in the case of the profit and loss account of the
profit of the Company for the year ended on that date; and
c) in the case of cash flow statement of the cash flows of
the Company for the year ended on that date.
For S. R. Batliboi & Co.
Chartered Accountants
per Anil Gupta
PartnerMembership No.: 87921
Place: New Delhi
Dated: June 6, 2007
Auditors’ Report to the Members of PVR Limited
StandaloneFinancial
statements
44
Re: PVR LIMITED
(i) (a) The Company has maintained proper records
showing full particulars including quantitative details and
situation of fixed assets.
(b) All fixed assets were physically verified by the
management in the current year in accordance with a
planned programme of verifying them once in two years
which, in our opinion, is reasonable having regard to the
size of the Company and the nature of its assets.
As informed, no material discrepancies were noticed on
such verification.
(c) There was no substantial disposal of fixed assets during
the year.
(ii) (a) The management has conducted physical
verification of inventory at reasonable intervals during
the year.
(b) The procedures of physical verification of inventory
followed by the management are reasonable and adequate
in relation to the size of the Company and the nature of its
business.
(c) The Company is maintaining proper records of
inventory and no material discrepancies were noticed on
physical verification.
(iii) (a) The Company has granted unsecured loans to two
companies covered in the register maintained under Section
301 of the Companies Act, 1956. The maximum amount
involved during the year was Rs. 489,571,296 and the
year end balance of loans granted is Rs. 218,000,000.
(b) In our opinion and according to the information and
explanations given to us, the rate of interest and the other
terms and conditions of the loans are not prima-facie
prejudicial to the interest of the Company.
(c) The terms of repayment of the above loans has not
been stipulated, as the same are stated to be repayable on
demand. The Company has received the repayment of the
loans as and when demanded by it. The receipt of interest
has been regular.
(d) There is no overdue amount of loans granted to
aforesaid two companies listed in the register maintained
under Section 301 of the Companies act, 1956.
(e) As informed, the Company has not taken any loans,
secured or unsecured from companies, firms or other
parties covered in the register maintained under Section
301 of the Companies Act, 1956. Therefore, the
provisions of clause 4(iii) (f) and (e) of the Companies
(Auditor’s Report) Order, 2003 (as amended) are not
applicable to the Company.
(iv) In our opinion and according to the information and
explanations given to us, there is an adequate internal
control system commensurate with the size of the
Company and the nature of its business, for the purchase
of inventory and fixed assets and for the sale of goods and
services. During the course of our audit, no major
weakness has been noticed in the internal control system in
respect of these areas.
(v) (a) According to the information and explanations
provided by the management, we are of the opinion that
the particulars of contracts or arrangements referred to in
Section 301 of the Companies Act, 1956 that need to be
entered into the register maintained under Section 301
have been so entered.
(b) In our opinion and according to the information and
explanations given to us, the transactions made in
pursuance of such contracts or arrangements exceeding
value of Rupees five lacs have been entered into during the
financial year at prices which are reasonable having regard to
the prevailing market prices at the relevant time.
(vi) The Company has not accepted any deposits from the
public.
(vii) In our opinion, the Company has an internal audit
system commensurate with the size and nature of its
business.
(viii) To the best of our knowledge and as explained, the
Central Government has not prescribed maintenance of
cost records under clause (d) of sub-section (1) of Section
209 of the Companies Act, 1956 for the products of the
Company.
(ix) (a) Undisputed statutory dues including provident
fund, investor education and protection fund, or
employees’ state insurance, income-tax, sales-tax,
wealth-tax, service-tax, customs-duty, excise-duty,
cess have generally been regularly deposited with the
appropriate authorities though there has been a slight delay
in a few cases.
(b) According to the information and explanations given to
us, no undisputed amounts payable in respect of provident
fund, investor education and protection fund, employees’
state insurance, income-tax, wealth-tax, service tax, sales-
Annexure referred to in paragraph 3of our report of even date
44 45
tax, customs duty, excise duty, cess and other undisputed
statutory dues were outstanding, at the year end, for a
period of more than six months from the date they
became payable.
(c) According to the information and explanations given to
us, there are no dues of income tax, sales-tax, wealth tax,
service tax, customs duty, excise duty and cess which have
not been deposited on account of any dispute.
(x) The Company has no accumulated losses at the end of
the financial year and it has not incurred cash losses in the
current and immediately preceding financial year.
(xi) Based on our audit procedures and as per the
information and explanations given by the management, we
are of the opinion that the Company has not defaulted in
repayment of dues to banks. The Company did not have
any loan from financial institutions and outstanding
debentures during the year.
(xii) According to the information and explanations given to
us and based on the documents and records produced to
us, the Company has not granted loans and advances on
the basis of security by way of pledge of shares, debentures
and other securities.
(xiii) In our opinion, the Company is not a chit fund or a
nidhi / mutual benefit fund / society. Therefore, the
provisions of clause 4(xiii) of the Companies (Auditor’s
Report) Order, 2003 (as amended) are not applicable to
the Company.
(xiv) In respect of dealing/trading in units of mutual funds, in
our opinion and according to the information and
explanations given to us, proper records have been
maintained of the transactions and contracts and timely
entries have been made therein. The units have been held
by the Company, in its own name.
(xv) According to the information and explanations given to
us, the Company has given guarantee for loans taken by a
subsidiary company from a financial institution, the terms
and conditions whereof in our opinion are not prima-facie
prejudicial to the interest of the Company.
(xvi) Based on information and explanations given to us by
the management, out of proceeds of term loans from a
bank of Rs. 100,000,000, unutilised amounts aggregating
to Rs. 64,028,472, were lying in bank accounts/mutual
funds. Read with above, term loans were applied for the
purpose for which the loans were obtained.
(xvii) According to the information and explanations given
to us and on an overall examination of the balance sheet of
the Company, we report that no funds raised on short-
term basis have been used for long-term investment.
(xviii) The Company has not made any preferential
allotment of shares to parties or companies covered in the
register maintained under Section 301 of the Companies
Act, 1956.
(xix) The Company did not have any outstanding
debentures during the year.
(xx) We have verified that the end use of money raised by
public issues is as disclosed in the notes to the financial
statements (Refer Note No. 9.2 of Schedule 24).
(xxi) Based upon the audit procedures performed for the
purpose of reporting the true and fair view of the financial
statements and as per the information and explanations
given by the management, we report that no fraud on or by
the Company has been noticed or reported during the
course of our audit.
For S. R. Batliboi & Co.
Chartered Accountants
per Anil Gupta
Partner
Membership No.: 87921
Place : New Delhi
Date : June 6, 2007
Re: PVR LIMITED
(i) (a) The Company has maintained proper records
showing full particulars including quantitative details and
situation of fixed assets.
(b) All fixed assets were physically verified by the
management in the current year in accordance with a
planned programme of verifying them once in two years
which, in our opinion, is reasonable having regard to the
size of the Company and the nature of its assets.
As informed, no material discrepancies were noticed on
such verification.
(c) There was no substantial disposal of fixed assets during
the year.
(ii) (a) The management has conducted physical
verification of inventory at reasonable intervals during
the year.
(b) The procedures of physical verification of inventory
followed by the management are reasonable and adequate
in relation to the size of the Company and the nature of its
business.
(c) The Company is maintaining proper records of
inventory and no material discrepancies were noticed on
physical verification.
(iii) (a) The Company has granted unsecured loans to two
companies covered in the register maintained under Section
301 of the Companies Act, 1956. The maximum amount
involved during the year was Rs. 489,571,296 and the
year end balance of loans granted is Rs. 218,000,000.
(b) In our opinion and according to the information and
explanations given to us, the rate of interest and the other
terms and conditions of the loans are not prima-facie
prejudicial to the interest of the Company.
(c) The terms of repayment of the above loans has not
been stipulated, as the same are stated to be repayable on
demand. The Company has received the repayment of the
loans as and when demanded by it. The receipt of interest
has been regular.
(d) There is no overdue amount of loans granted to
aforesaid two companies listed in the register maintained
under Section 301 of the Companies act, 1956.
(e) As informed, the Company has not taken any loans,
secured or unsecured from companies, firms or other
parties covered in the register maintained under Section
301 of the Companies Act, 1956. Therefore, the
provisions of clause 4(iii) (f) and (e) of the Companies
(Auditor’s Report) Order, 2003 (as amended) are not
applicable to the Company.
(iv) In our opinion and according to the information and
explanations given to us, there is an adequate internal
control system commensurate with the size of the
Company and the nature of its business, for the purchase
of inventory and fixed assets and for the sale of goods and
services. During the course of our audit, no major
weakness has been noticed in the internal control system in
respect of these areas.
(v) (a) According to the information and explanations
provided by the management, we are of the opinion that
the particulars of contracts or arrangements referred to in
Section 301 of the Companies Act, 1956 that need to be
entered into the register maintained under Section 301
have been so entered.
(b) In our opinion and according to the information and
explanations given to us, the transactions made in
pursuance of such contracts or arrangements exceeding
value of Rupees five lacs have been entered into during the
financial year at prices which are reasonable having regard to
the prevailing market prices at the relevant time.
(vi) The Company has not accepted any deposits from the
public.
(vii) In our opinion, the Company has an internal audit
system commensurate with the size and nature of its
business.
(viii) To the best of our knowledge and as explained, the
Central Government has not prescribed maintenance of
cost records under clause (d) of sub-section (1) of Section
209 of the Companies Act, 1956 for the products of the
Company.
(ix) (a) Undisputed statutory dues including provident
fund, investor education and protection fund, or
employees’ state insurance, income-tax, sales-tax,
wealth-tax, service-tax, customs-duty, excise-duty,
cess have generally been regularly deposited with the
appropriate authorities though there has been a slight delay
in a few cases.
(b) According to the information and explanations given to
us, no undisputed amounts payable in respect of provident
fund, investor education and protection fund, employees’
state insurance, income-tax, wealth-tax, service tax, sales-
Annexure referred to in paragraph 3of our report of even date
46
Schedules As at As atMarch 31, 2007 March 31, 2006
(Rs.) (Rs.)
SOURCES OF FUNDS
Shareholders’ FundsShare Capital 1 430,138,700 428,773,700
Employees Stock Options Outstanding 2 - 2,915,966
Reserves and surplus 3 1,573,579,736 1,496,652,425
2,003,718,436 1,928,342,091
Loan fundsSecured loans 4 600,664,739 613,655,281
Deferred Tax Liabilities (Net) 5 64,624,243 46,744,852
2,669,007,418 2,588,742,224
APPLICATION OF FUNDS
Fixed Assets 6Gross block 1,697,790,594 1,009,502,836Less : Accumulated Depreciation 348,667,654 227,292,224
Net block 1,349,122,940 782,210,612Capital Work-in-Progress including Capital Advances 144,275,380 439,322,967Pre-operative expenses (pending allocation) 7 37,987,538 141,809,270
1,531,385,858 1,363,342,849
Intangible Assets (net of amortisation and including 8 6,059,864 3,551,235capital work-in-progress and capital advances)
Investments 9 629,016,644 309,269,691
Current Assets, Loans and AdvancesInterest accrued on long term investments 1,406,603 914,356Inventories 10 17,615,286 9,246,574Sundry debtors 11 55,259,967 28,954,797Cash and bank balances 12 70,109,377 628,547,287Other current assets 13 3,554,139 11,587,690Loans and advances 14 674,979,616 528,306,040
822,924,988 1,207,556,744
Less: Current Liabilities and ProvisionsCurrent liabilities 15 251,964,248 223,953,987Provisions 16 68,415,688 71,024,308
320,379,936 294,978,295
Net Current Assets 502,545,052 912,578,449
Miscellaneous Expenditure 17 - -
2,669,007,418 2,588,742,224
Notes to Accounts 24
The Schedules referred to above and Notes to Accounts form an integral part of the Balance Sheet
As per our report of even date
For S. R. Batliboi & Co. FOR AND ON BEHALF OF THE BOARD OF DIRECTORSChartered Accountants
Ajay Bijli Sanjeev Kumar N. C. GuptaChairman cum Managing Director Joint Managing Director Company Secretary
per Anil Gupta Sumit Chandwani Renaud Jean Palliere Neeraj PrakashPartner Director Director Chief of AccountsMembership No 87921
Place : New DelhiDate : June 6, 2007
Balance Sheet as at 31 March, 2007
46 47
Schedules As at As atMarch 31, 2007 March 31, 2006
(Rs.) (Rs.)
SOURCES OF FUNDS
Shareholders’ FundsShare Capital 1 430,138,700 428,773,700
Employees Stock Options Outstanding 2 - 2,915,966
Reserves and surplus 3 1,573,579,736 1,496,652,425
2,003,718,436 1,928,342,091
Loan fundsSecured loans 4 600,664,739 613,655,281
Deferred Tax Liabilities (Net) 5 64,624,243 46,744,852
2,669,007,418 2,588,742,224
APPLICATION OF FUNDS
Fixed Assets 6Gross block 1,697,790,594 1,009,502,836Less : Accumulated Depreciation 348,667,654 227,292,224
Net block 1,349,122,940 782,210,612Capital Work-in-Progress including Capital Advances 144,275,380 439,322,967Pre-operative expenses (pending allocation) 7 37,987,538 141,809,270
1,531,385,858 1,363,342,849
Intangible Assets (net of amortisation and including 8 6,059,864 3,551,235capital work-in-progress and capital advances)
Investments 9 629,016,644 309,269,691
Current Assets, Loans and AdvancesInterest accrued on long term investments 1,406,603 914,356Inventories 10 17,615,286 9,246,574Sundry debtors 11 55,259,967 28,954,797Cash and bank balances 12 70,109,377 628,547,287Other current assets 13 3,554,139 11,587,690Loans and advances 14 674,979,616 528,306,040
822,924,988 1,207,556,744
Less: Current Liabilities and ProvisionsCurrent liabilities 15 251,964,248 223,953,987Provisions 16 68,415,688 71,024,308
320,379,936 294,978,295
Net Current Assets 502,545,052 912,578,449
Miscellaneous Expenditure 17 - -
2,669,007,418 2,588,742,224
Notes to Accounts 24
The Schedules referred to above and Notes to Accounts form an integral part of the Balance Sheet
As per our report of even date
For S. R. Batliboi & Co. FOR AND ON BEHALF OF THE BOARD OF DIRECTORSChartered Accountants
Ajay Bijli Sanjeev Kumar N. C. GuptaChairman cum Managing Director Joint Managing Director Company Secretary
per Anil Gupta Sumit Chandwani Renaud Jean Palliere Neeraj PrakashPartner Director Director Chief of AccountsMembership No 87921
Place : New DelhiDate : June 6, 2007
Schedules For the year ended For the year endedMarch 31, 2007 March 31, 2006
(Rs.) (Rs.)
INCOME
Operating income 18 1,986,065,860 1,285,763,024Less: Entertainment tax collected on sale of tickets 291,582,187 224,379,377Less: Sales tax/Value Added tax collected on sale 40,692,112 26,779,327of food and beveragesLess: Service tax collected on advertisement and 12,867,061 4,443,431management fees
1,640,924,500 1,030,160,889Other income 19 78,696,470 30,089,241
1,719,620,970 1,060,250,130
EXPENDITUREFilm distributors’ share (net of recovery towards 442,734,136 271,362,572publicity from distributors Rs. 4,376,315,Previous year Rs. 3,034,500)Consumption of food and beverages 114,552,600 71,241,239Personnel expenses 20 192,734,730 121,607,674Employee compensation expenses under employee 2,909,928 7,008,183share purchase scheme and employee stock option schemeOperating and other expenses 21 635,061,066 396,035,067
1,387,992,460 867,254,735
Profit before depreciation/amortisation, 331,628,510 192,995,395interest and tax (EBITDA)Depreciation/amortisation 124,153,009 70,717,148Interest paid 22 54,962,272 32,256,609
Profit Before Tax 152,513,229 90,021,638
Provision for taxes (Including wealth tax Rs. 50,000, (26,500,000) (27,100,000)Previous year Rs. 30,000)Fringe benefit tax (5,000,000) (3,698,244)Deferred tax charge (18,016,497) (4,459,528)Income tax credit for earlier years (net) 2,626,365 -
Total Tax Expense (46,890,132) (35,257,772)
Net Profit after tax 105,623,097 54,763,866Balance brought forward from previous year 133,858,450 88,535,984Less: Adjustment for Employee Benefits Provision (270,219) -(Net of Tax Rs. 137,106) (Refer Note No. 2 (b) in Schedule 24)Transfer from Debenture Redemption Reserve - 22,600,000
Profit available for appropriation 239,211,328 165,899,850Appropriations- Interim dividend on equity shares 22,915,370 22,877,370- Interim dividend on preference shares 10,000,000 5,219,178 - Tax on dividend 4,616,381 3,944,852
Surplus carried to Balance Sheet 201,679,577 133,858,450
Earnings per share 23Basic [Nominal value of shares Rs. 10 (Previous Year : Rs. 10)] 4.12 2.62Diluted [Nominal value of shares Rs. 10 (Previous Year : Rs. 10)] 4.12 2.62
Notes to Accounts 24
Balance Sheet as at 31 March, 2007 Profit and Loss Accountfor the year ended March 31, 2007
The Schedules referred to above and Notes to Accounts form an integral part of the Profit & Loss Account.
As per our report of even date
For S. R. Batliboi & Co. FOR AND ON BEHALF OF THE BOARD OF DIRECTORSChartered Accountants
Ajay Bijli Sanjeev Kumar N. C. GuptaChairman cum Managing Director Joint Managing Director Company Secretary
per Anil Gupta Sumit Chandwani Renaud Jean Palliere Neeraj PrakashPartner Director Director Chief of AccountsMembership No 87921
Place : New DelhiDate : June 6, 2007
48
For the year ended For the year endedMarch 31, 2007 March 31, 2006
(Rs.) (Rs.)
A. Cash flow from operating activities:
Profit before taxation 152,513,229 90,021,638
Adjustments for :
Depreciation/amortisation 124,153,009 70,717,148
Loss on disposal of fixed assets (net) 1,246,098 2,515,492
Interest income (33,105,998) (13,444,643)
Profit on sale of current investments (242,763) -
Loss on sale of current investments - 35,506
Dividend income (26,060,706) (3,391,096)
Interest expense 54,962,272 32,256,609
Employee compensation expenses under employee share purchase scheme
and employee stock option scheme 2,909,928 7,008,183
Provision for doubtful debts and advances (net) 2,278,143 1,602,381
Operating profit before working capital changes 278,653,212 187,321,218
Movements in working capital :
(Increase) in sundry debtors (28,583,314) (5,958,875)
(Increase) in inventories (8,368,712) (2,469,958)
(Increase) in loans and advances and other current assets (122,917,535) (102,344,854)
(Decrease)/Increase in current liabilities and provisions 34,705,141 76,576,767
Cash generated from operations 153,488,792 153,124,298
Direct taxes paid (net of refunds) (37,896,873) (21,094,996)
Net cash from operating activities 115,591,919 132,029,302
B. Cash flows from investing activities
Purchase of fixed assets (289,057,590) (564,259,310)
Purchase of intangible assets (3,616,357) (1,211,103)
Proceeds from sale of fixed assets 67,579 1,091,000
Consideration paid for acquiring interest in a subsidiary - (500,000)
Purchase of investments (3,020,683,458) (722,169,691)
Sale of investments 2,701,179,268 439,964,494
Loans given to subsidiaries (288,500,226) (232,713,803)
Loans refunded by subsidiaries 298,571,296 9,642,733
Dividend received 26,060,706 3,391,096
Interest received 39,993,691 6,320,674
Fixed Deposits with banks placed (10,947,727) (623,325,033)
Fixed Deposits with banks encashed 613,371,938 22,040,980
Net cash from/(used in) investing activities 66,439,120 (1,661,727,963)
C. Cash flow from financing activities
Proceeds from issuance of share capital 3,885,000 1,484,100,000
Proceeds from long-term borrowings 105,800,000 360,361,101
Repayment of long-term borrowings (118,790,542) (201,779,288)
Proceeds from short-term borrowings - 240,000,000
Repayment of short-term borrowings - (250,000,000)
Expenditure on share issue - (113,037,501)
Dividend and tax thereon paid (69,573,151) -
Interest paid (57,410,961) (59,575,479)
Net cash (used in)/from financing activities (136,089,654) 1,460,068,833
Net increase/(decrease) in cash and cash equivalents (A+B+C) 45,941,385 (69,629,828)
Cash and cash equivalents at the beginning of the year 11,738,414 81,368,242
Cash and cash equivalents at the end of the year 57,679,799 11,738,414
Cash Flow Statement for the year ended March 31, 2007
48 49
For the year ended For the year endedMarch 31, 2007 March 31, 2006
(Rs.) (Rs.)
A. Cash flow from operating activities:
Profit before taxation 152,513,229 90,021,638
Adjustments for :
Depreciation/amortisation 124,153,009 70,717,148
Loss on disposal of fixed assets (net) 1,246,098 2,515,492
Interest income (33,105,998) (13,444,643)
Profit on sale of current investments (242,763) -
Loss on sale of current investments - 35,506
Dividend income (26,060,706) (3,391,096)
Interest expense 54,962,272 32,256,609
Employee compensation expenses under employee share purchase scheme
and employee stock option scheme 2,909,928 7,008,183
Provision for doubtful debts and advances (net) 2,278,143 1,602,381
Operating profit before working capital changes 278,653,212 187,321,218
Movements in working capital :
(Increase) in sundry debtors (28,583,314) (5,958,875)
(Increase) in inventories (8,368,712) (2,469,958)
(Increase) in loans and advances and other current assets (122,917,535) (102,344,854)
(Decrease)/Increase in current liabilities and provisions 34,705,141 76,576,767
Cash generated from operations 153,488,792 153,124,298
Direct taxes paid (net of refunds) (37,896,873) (21,094,996)
Net cash from operating activities 115,591,919 132,029,302
B. Cash flows from investing activities
Purchase of fixed assets (289,057,590) (564,259,310)
Purchase of intangible assets (3,616,357) (1,211,103)
Proceeds from sale of fixed assets 67,579 1,091,000
Consideration paid for acquiring interest in a subsidiary - (500,000)
Purchase of investments (3,020,683,458) (722,169,691)
Sale of investments 2,701,179,268 439,964,494
Loans given to subsidiaries (288,500,226) (232,713,803)
Loans refunded by subsidiaries 298,571,296 9,642,733
Dividend received 26,060,706 3,391,096
Interest received 39,993,691 6,320,674
Fixed Deposits with banks placed (10,947,727) (623,325,033)
Fixed Deposits with banks encashed 613,371,938 22,040,980
Net cash from/(used in) investing activities 66,439,120 (1,661,727,963)
C. Cash flow from financing activities
Proceeds from issuance of share capital 3,885,000 1,484,100,000
Proceeds from long-term borrowings 105,800,000 360,361,101
Repayment of long-term borrowings (118,790,542) (201,779,288)
Proceeds from short-term borrowings - 240,000,000
Repayment of short-term borrowings - (250,000,000)
Expenditure on share issue - (113,037,501)
Dividend and tax thereon paid (69,573,151) -
Interest paid (57,410,961) (59,575,479)
Net cash (used in)/from financing activities (136,089,654) 1,460,068,833
Net increase/(decrease) in cash and cash equivalents (A+B+C) 45,941,385 (69,629,828)
Cash and cash equivalents at the beginning of the year 11,738,414 81,368,242
Cash and cash equivalents at the end of the year 57,679,799 11,738,414
Components of cash and cash equivalents as at* March 31, 2007 March 31, 2006
Cash and cheques on hand 8,576,083 4,077,013
With banks - on current accounts 48,632,720 9,616,485
- on book overdraft account - (1,955,084)
- on unpaid and unclaimed dividend accounts 470,996 -
57,679,799 11,738,414
*difference of Rs. 12,429,578 (Previous year Rs. 616,808,873) from Schedule 12 represents short-term investments with an original
maturity of three months or more.
NOTE: The above Cash Flow Statement has been prepared under the “Indirect Method” as stated in Accounting Standard 3 on Cash
Flow Statement.
Cash Flow Statement for the year ended March 31, 2007 Cash Flow Statement for the year ended March 31, 2007(continued)
As per our report of even date
For S. R. Batliboi & Co. FOR AND ON BEHALF OF THE BOARD OF DIRECTORSChartered Accountants
Ajay Bijli Sanjeev Kumar N. C. GuptaChairman cum Managing Director Joint Managing Director Company Secretary
per Anil Gupta Sumit Chandwani Renaud Jean Palliere Neeraj PrakashPartner Director Director Chief of AccountsMembership No 87921
Place : New DelhiDate : June 6, 2007
50
Schedule 1 : Share capital
As at As atMarch 31, 2007 March 31, 2006
(Rs.) (Rs.)
Authorised share capital30,000,000 (Previous year 30,000,000) equity shares of Rs. 10 each 300,000,000 300,000,00020,000,000 (Previous year 20,000,000) preference shares of Rs. 10 each 200,000,000 200,000,000
500,000,000 500,000,000
Issued, subscribed and paid-up23,013,870 (Previous year 22,877,370) equity shares of Rs. 10 each fully paid 230,138,700 228,773,70020,000,000 (Previous year 20,000,000) 5% redeemable 200,000,000 200,000,000preference shares of Rs. 10 each fully paid
430,138,700 428,773,700
NOTES:
1. Of the above 10,642,000 (Previous year 10,642,000) 5% redeemable preference shares are held by Mr. Ajay Bijli, Chairmancum Managing Director.
2. Preference shares are redeemable at par after three years with a put and call option at the end of two years from the date ofallotment.
3. Of the above Nil (Previous year 80,000) equity shares of the face value of Rs. 10 each issued to the eligible employees underEmployees Share Purchase Scheme.
4. Of the above 136,500 (Previous year Nil) equity shares of the face value of Rs. 10 each issued to the eligible employees underEmployees Stock Option Scheme (Refer Note No. 5 of Schedule 24).
Schedule 2 : Employees Stock Options Outstanding
Employees stock options outstandingAs per last account 2,915,966 -Add: Accounted for during the year (net) (Refer Note No. 5 of Schedule 24) 3,541,534 2,915,966
6,457,500 2,915,966
Less: Amount transferred to Securities Premium Account upon issue of equity shares 6,457,500 -
- 2,915,966
Schedule 3 : Reserves and Surplus
Securities premium account - as per last account 1,362,793,975 250,306,573Add:Received on issue of shares under employees share purchase/employees 2,520,000 5,600,000stock option schemeReceived on issue of shares to public during the year - 1,225,500,000Amount transferred from Employees Stock Options Outstanding Account 6,457,500 -Excess provision for share issue expenses now written back and 128,684 -
adjusted from securities premium account1,371,900,159 1,481,406,573
Less: Share/debenture placement expenses written off - 118,612,598
1,371,900,159 1,362,793,975
Debenture redemption reserve - As per last account - 22,600,000Less: Transferred to Profit and Loss Account on redemption of debentures - 22,600,000
- -
Profit and Loss Account Balance 201,679,577 133,858,450
1,573,579,736 1,496,652,425
Schedules to the accounts
50 51
Schedule 4 : SecureD Loans
As at As atMarch 31, 2007 March 31, 2006
(Rs.) (Rs.)
Loans from banksTerm loans from banks 520,639,524 522,754,554(Due within one year Rs. 139,008,752, (Previous year Rs. 102,096,655))Car finance loans from banks 5,675,215 350,727(Due within one year Rs. 1,125,553, (Previous year Rs. 162,538))
Other loansTerm loan from small industries development bank of india (SIDBI) 74,350,000 90,550,000(Due within one year Rs. 16,200,000, (Previous year Rs. 16,200,000))
600,664,739 613,655,281
NOTES :
1. a) Term loans from State Bank of Patiala, United Bank of India and Union bank of India to the extent of Rs. 233,139,524
(Previous year Rs. 322,754,554) are secured by first charge by way of hypothecation of the whole of the movable properties
including movable plant and machinery, machinery spares, tools and accessories and other movable assets
(except vehicles hypothecated to banks) of all current and future operating theatres of the Company ranking pari passu
with other lenders. These are further secured by the personal guarantee of two directors of the Company.
b) Term Loan from ICICI Bank Limited to the extent of Rs. 187,500,000 (Previous year Rs. 200,000,000) is secured by first
charge on all of the Company’s movable assets, save and except the assets at the Juhu multiplex, both present and future, on
pari passu basis with other term lenders. This loan is further secured by mortgage of the personal properties
of two directors at Vasant Vihar and Kundli, New Delhi and is to be further secured by pledge of the PVR Brand/patent/
trademark. This loan is further secured by the personal guarantee of two directors of the Company.
c) Term Loan from Punjab National Bank to the extent of Rs. 100,000,000, (Previous year Rs. Nil) is secured by first pari passu
charge with other lenders on all assets and movable property (excluding vehicles hypothecated to banks), including current assets
namely current and movable fixed assets of any kind belonging to the Company both present and future except those at PVR
Juhu, Mumbai. This loan is further secured by second charge on all the movable and immovable assets namely current and
movable fixed assets as well as the movable and immovable assets at PVR Juhu, Mumbai of the Company and PVR Phoenix,
Mumbai of the subsidiary.
2. Car finance loans to the extent of Rs. 5,675,215 (Previous year Rs. 350,727) are to be secured by hypothecation of vehicles
purchased out of the proceeds of the loans.
3. Loan from SIDBI to the extent of Rs. 74,350,000 (Previous year Rs. 90,550,000) is secured by a first pari passu charge by way of
hypothecation of all the movable assets (except vehicles hypothecated to banks) both present and future, of all cinemas of the
Company. It is further secured by a second charge on personal properties of a director at Vasant Vihar and Jhandewalan, New Delhi
and is also secured by the personal guarantee of two directors of the Company.
Schedules to the accounts
Schedule 1 : Share capital
As at As atMarch 31, 2007 March 31, 2006
(Rs.) (Rs.)
Authorised share capital30,000,000 (Previous year 30,000,000) equity shares of Rs. 10 each 300,000,000 300,000,00020,000,000 (Previous year 20,000,000) preference shares of Rs. 10 each 200,000,000 200,000,000
500,000,000 500,000,000
Issued, subscribed and paid-up23,013,870 (Previous year 22,877,370) equity shares of Rs. 10 each fully paid 230,138,700 228,773,70020,000,000 (Previous year 20,000,000) 5% redeemable 200,000,000 200,000,000preference shares of Rs. 10 each fully paid
430,138,700 428,773,700
NOTES:
1. Of the above 10,642,000 (Previous year 10,642,000) 5% redeemable preference shares are held by Mr. Ajay Bijli, Chairmancum Managing Director.
2. Preference shares are redeemable at par after three years with a put and call option at the end of two years from the date ofallotment.
3. Of the above Nil (Previous year 80,000) equity shares of the face value of Rs. 10 each issued to the eligible employees underEmployees Share Purchase Scheme.
4. Of the above 136,500 (Previous year Nil) equity shares of the face value of Rs. 10 each issued to the eligible employees underEmployees Stock Option Scheme (Refer Note No. 5 of Schedule 24).
Schedule 2 : Employees Stock Options Outstanding
Employees stock options outstandingAs per last account 2,915,966 -Add: Accounted for during the year (net) (Refer Note No. 5 of Schedule 24) 3,541,534 2,915,966
6,457,500 2,915,966
Less: Amount transferred to Securities Premium Account upon issue of equity shares 6,457,500 -
- 2,915,966
Schedule 3 : Reserves and Surplus
Securities premium account - as per last account 1,362,793,975 250,306,573Add:Received on issue of shares under employees share purchase/employees 2,520,000 5,600,000stock option schemeReceived on issue of shares to public during the year - 1,225,500,000Amount transferred from Employees Stock Options Outstanding Account 6,457,500 -Excess provision for share issue expenses now written back and 128,684 -
adjusted from securities premium account1,371,900,159 1,481,406,573
Less: Share/debenture placement expenses written off - 118,612,598
1,371,900,159 1,362,793,975
Debenture redemption reserve - As per last account - 22,600,000Less: Transferred to Profit and Loss Account on redemption of debentures - 22,600,000
- -
Profit and Loss Account Balance 201,679,577 133,858,450
1,573,579,736 1,496,652,425
Schedules to the accounts
Schedule 5 : Deferred Tax Liabilities (Net)
As at As atMarch 31, 2007 March 31, 2006
(Rs.) (Rs.)
Deferred Tax LiabilitiesDifferences in depreciation and other differences in block of 68,741,898 48,974,538fixed assets as per tax books and financial books
Gross Deferred Tax Liabilities 68,741,898 48,974,538
Deferred Tax AssetsEffect of expenditure debited to profit and loss account in the current year/ 2,713,419 1,605,906earlier years but allowable for tax purposes in following yearsProvision for doubtful debts and advances 1,404,236 623,780
Gross Deferred Tax Assets 4,117,655 2,229,686
Net Deferred Tax Liabilities 64,624,243 46,744,852
52
Schedule
6
: Fixe
d Ass
ets
Rs.
Lan
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ree
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Additi
ons
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2
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8,0
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1
6,9
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86
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Deduct
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15
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4 1
59
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40
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1 7
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1
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Net
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1.F
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59
,48
0,
(WD
V R
s.1
,20
9,9
41
, Pre
vio
us
year
Rs.
1,5
91
,30
0)
hav
e b
een
dis
card
ed
du
rin
g th
e y
ear
.
2.G
ross
Blo
ck o
f Fi
xed
Ass
ets
incl
ud
e R
s. 4
3,9
51
,08
9 (
Pre
vio
us
year
Rs.
28
,15
2,0
00
) b
ein
g C
om
pan
y’s
pro
po
rtio
nat
e s
har
e o
f exp
ense
s to
war
ds
mo
difi
catio
n i
n t
he b
uild
ing
stru
cture
and
eq
uip
ments
,
clai
med b
y th
e v
ario
us
landlo
rds
of
the p
ropert
ies
take
n o
n r
ent.
3.C
laim
of
Rs.
17
,46
4,3
17
lo
dge
d b
y so
me d
eve
lop
ers
on t
he C
om
pan
y an
d c
laim
s o
f R
s. 7
,68
1,0
33
lo
dge
d b
y th
e C
om
pan
y o
n t
he d
eve
lop
ers
are
sub
ject
to
co
nfir
mat
ion/r
eco
nci
liatio
n.
Ho
weve
r, t
he
Co
mpan
y has
duly
acc
ounte
d f
or
afo
resa
id c
laim
s in
the b
oo
ks.
Adju
stm
ents
, if
any,
whic
h i
n t
he o
pin
ion o
f th
e m
anag
em
ent,
will
no
t be m
ateri
al w
ould
be m
ade o
nce
the c
laim
s ar
e c
onfir
med/r
eco
nci
led.
4.
Dep
reci
atio
n p
rovi
ded
fo
r th
e y
ear
is
net
of
reve
rsal
of
exc
ess
dep
reci
atio
n o
f R
s. 6
,56
4,3
99
pro
vid
ed
till
pre
vio
us
year
.
52 53
Schedule 7 : Pre-Operative Expenses (pending allocation)As at As at
March 31, 2007 March 31, 2006(Rs.) (Rs.)
Balance brought forward 141,809,270 37,739,800Salary and other allowances 11,772,450 13,759,472Contribution to Provident and other funds 878,449 1,023,487Staff welfare expenses 479,023 1,560,950Employee compensation expenses under employee share purchase scheme and 631,607 707,782employee stock option schemeRent 1,103,250 26,041,848Rates and taxes 1,961,832 13,333,453Communication costs 239,894 1,176,856Architect and other fees 10,966,796 15,526,857Professional charges 6,385,342 15,831,817Travelling and conveyance 2,257,998 11,750,797Printing and stationery 111,589 223,530Insurance 322,230 1,092,301Repairs and maintenance:
-Buildings 3,179,095 6,703,152-Common areas maintenance - 4,766,886
Electricity and water charges 1,210,181 1,914,050(Net of recovery Rs. 919,935, Previous year Rs. 1,879,699)Security service charges 819,099 2,272,286Interest on fixed loans 2,520,124 22,625,124Interest to Banks - 5,700,542Foreign exchange fluctuation 46,567 -Bank and other charges - 3,560,000Fringe benefit tax 192,646 993,502Miscellaneous expenses 644,711 1,713,459
187,850,153 190,017,951Less: Interest received (Gross, tax deducted at source Rs. Nil, - 1,957,816
Previous year Rs. 439,338)Less: Amount recovered from developers towards re-negotiation of rent 5,593,662 -Less; Allocated to fixed assets 144,268,953 30,987,062Less: Expenses pertaining to Lower Parel Project transferred to - 15,263,803wholly owned subsidiary
Balance Carried Forward 37,987,538 141,809,270
NOTE : Rent includes amount paid to a director 918,000 918,000Rates and taxes includes stamp duty on registration of lease deed 1,772,300 11,732,700
Sch
edule
6
: Fixed Ass
ets
Rs.
Lan
d F
ree
ho
ldB
uild
ing
Le
ase
ho
ldP
lan
t &
Fu
rnit
ure
&V
eh
icle
sTo
tal
Pre
vio
us
Year
Imp
rove
me
nts
Mac
hin
ery
Fit
tin
gs
Gro
ss B
lock
At
01
.04
.20
06
1
90
,35
0
1,2
73
,59
0
28
6,9
60
,02
9
56
2,6
81
,44
5
15
2,3
80
,18
8
6,0
17
,23
4
1,0
09
,50
2,8
36
82
8,9
79
,72
3
Additi
ons
- -
2
65
,25
8,0
70
3
13
,81
9,4
41
10
5,2
13
,16
1
6,9
80
,61
4
69
1,2
71
,28
6 1
86
,49
0,7
06
Deduct
ions
- -
15
,60
0 9
05
,19
9 2
,06
2,7
29
- 2
,98
3,5
28
5,9
67
,59
3
At
31
.03
.20
07
19
0,3
50
1,2
73
,59
0
55
2,2
02
,49
9 8
75
,59
5,6
87
25
5,5
30
,62
0 1
2,9
97
,84
8
1,6
97
,79
0,5
94
1,0
09
,50
2,8
36
De
pre
cia
tio
n
At
01
.04
.20
06
-
16
9,5
39
65
,66
8,2
60
12
1,3
31
,77
7
38
,68
8,0
10
1
,43
4,6
38
22
7,2
92
,22
4 1
59
,45
2,4
62
For
the y
ear
- 2
0,7
60
40
,45
2,2
80
55
,98
1,3
14
2
5,5
68
,48
3
1,0
22
,44
4
12
3,0
45
,28
1 7
0,1
45
,57
6
Ded
uct
ions
- -
1
1,0
13
37
3,5
43
1
,28
5,2
95
- 1
,66
9,8
51
2,3
05
,81
4
At
31
.03
.20
07
-
1
90
,29
9
10
6,1
09
,52
7 1
76
,93
9,5
48
6
2,9
71
,19
8
2,4
57
,08
2 3
48
,66
7,6
54
22
7,2
92
,22
4
Fo
r p
revi
ou
s ye
ar -
20
,76
0
17
,97
9,6
97
3
8,1
86
,98
6 1
3,3
27
,61
9
63
0,5
14
70
,14
5,5
76
Net
Blo
ck
At
31
.03
.20
07
19
0,3
50
1,0
83
,29
1 4
46
,09
2,9
72
69
8,6
56
,13
9 1
92
,55
9,4
22
10
,54
0,7
66
1,3
49
,12
2,9
40
78
2,2
10
,61
2
At
31
.03
.20
06
1
90
,35
0
1,1
04
,05
1 2
21
,29
1,7
69
4
41
,34
9,6
68
1
13
,69
2,1
78
4
,58
2,5
96
7
82
,21
0,6
12
Cap
ital
wo
rk i
n p
rogr
ess
11
8,1
18
,49
3 3
75
,23
4,2
40
Cap
ital
Adva
nce
s (U
nse
cure
d,
consi
dere
d g
oo
d)
26
,15
6,8
87
6
4,0
88
,72
7
14
4,2
75
,38
0 4
39
,32
2,9
67
To
tal
19
0,3
50
1,0
83
,29
1 4
46
,09
2,9
72
69
8,6
56
,13
9 1
92
,55
9,4
22
10
,54
0,7
66
1,4
93
,39
8,3
20
1,2
21
,53
3,5
79
NO
TE
S:
1.F
ixed
ass
ets
of
the c
ost
of
Rs.
2,8
43
,66
8,
Pre
vio
us
year
Rs.
2,7
59
,48
0,
(WD
V R
s.1
,20
9,9
41
, Pre
vio
us
year
Rs.
1,5
91
,30
0)
hav
e b
een
dis
card
ed
du
rin
g th
e y
ear
.
2.G
ross
Blo
ck o
f Fi
xed
Ass
ets
incl
ud
e R
s. 4
3,9
51
,08
9 (
Pre
vio
us
year
Rs.
28
,15
2,0
00
) b
ein
g C
om
pan
y’s
pro
po
rtio
nat
e s
har
e o
f exp
ense
s to
war
ds
mo
difi
catio
n i
n t
he b
uild
ing
stru
cture
and
eq
uip
ments
,
clai
med b
y th
e v
ario
us
landlo
rds
of
the p
ropert
ies
take
n o
n r
ent.
3.C
laim
of
Rs.
17
,46
4,3
17
lo
dge
d b
y so
me d
eve
lop
ers
on t
he C
om
pan
y an
d c
laim
s o
f R
s. 7
,68
1,0
33
lo
dge
d b
y th
e C
om
pan
y o
n t
he d
eve
lop
ers
are
sub
ject
to
co
nfir
mat
ion/r
eco
nci
liatio
n.
Ho
weve
r, t
he
Co
mpan
y has
duly
acc
ounte
d f
or
afo
resa
id c
laim
s in
the b
oo
ks.
Adju
stm
ents
, if
any,
whic
h i
n t
he o
pin
ion o
f th
e m
anag
em
ent,
will
no
t be m
ateri
al w
ould
be m
ade o
nce
the c
laim
s ar
e c
onfir
med/r
eco
nci
led.
4.
Dep
reci
atio
n p
rovi
ded
fo
r th
e y
ear
is
net
of
reve
rsal
of
exc
ess
dep
reci
atio
n o
f R
s. 6
,56
4,3
99
pro
vid
ed
till
pre
vio
us
year
.
Schedules to the accounts
Schedule 8 : Intangible Assets Rs.
Software Film Rights’ Cost Total Previous YearDevelopment Cost
Gross Blockat 01.04.2006 4,307,369 1,834,658 6,142,027 4,386,900Additions 3,597,857 - 3,597,857 1,755,127
At 31.03.2007 7,905,226 1,834,658 9,739,884 6,142,027
AmortisationAt 01.04.2006 1,175,134 1,834,658 3,009,792 2,438,220For the year 1,107,728 - 1,107,728 571,572
At 31.03.2007 2,282,862 1,834,658 4,117,520 3,009,792
For previous year 571,572 - 571,572 -
Net Block
At 31.03.2007 5,622,364 - 5,622,364 3,132,235
Capital Advances 437,500 419,000(Unsecured, considered good)
At 31.03.2007 5,622,364 - 6,059,864 3,551,235
At 31.03.2006 3,132,235 - 3,132,235
54
Schedule 9 : InvestmentAs at As at
March 31, 2007 March 31, 2006(Rs.) (Rs.)
Long Term InvestmentsOther than trade investments
A. In Subsidiary Companies (Unquoted)
Fully paid up equity shares of Rs. 10 each
20,000,000 (Previous year 710,000) in CR Retail Malls 200,000,000 7,100,000(India) Private Limited
1,500,000 (Previous year 1,500,000) in PVR Pictures Limited 15,000,000 15,000,000
B. In Government Securities (Unquoted)
6 years National Savings Certificates* 5,548,000 5,000,000(Deposited with Entertainment Tax Authorities)
6 years National Savings Certificates** 45,000 45,000(Deposited with Municipal Corporation of Hyderabad)
Current InvestmentsOther than trade investments (Quoted)***Units in mutual funds of Rs. 10 each
8,318,556.811 (Previous year Nil) units of P32ISD Prudential 83,185,568 -ICICI Liquid Plan - Super Institutional Daily Dividend
15,170,726.024 (Previous year Nil) units of OLPIPD HSBC Liquid Plus- 151,774,513 -Inst. Plus-Daily Dividend
13,022,840.564 (Previous year Nil) units of Reliance Liquidity Fund - daily 130,268,776 -dividend Reinvestment option - Reinvestment
Nil (Previous year 4,092,598.134) units of B503DD Birla Cash Plus - - 41,005,787Institutional Premium - Daily Dividend Reinvestment
Nil (Previous year 5,059,051.637) units of Kotak FMP Series XV - Dividend - 50,590,516Nil (Previous year 10,000,000) units of C93 Chola FMP - - 100,000,000Series 2 (Quarterly Plan-I) - Dividend
Nil (Previous year 5,000,000) units of C95 Chola FMP - Series 2 - 50,000,000(Quarterly Plan-II) - Dividend
Units in mutual funds of Rs. 1,000 each42370.856 (Previous year Nil) units of UTI Liquid Cash Plan Institutional - 43,194,787 -Daily Income Option - Reinvestment
Nil (Previous year 40,520.284) units of DSP Merrill Lynch Liquidity Fund - - 40,528,388Institutional - Daily Dividend
629,016,644 309,269,691
NOTES :1. *Held in the name of the Managing Director in the interest of the Company.2. **Held in the name of the Employee in the interest of the Company.3. ***Invested out of unutilised monies out of issue of share capital and loan proceeds.4. The following units held in mutual funds werepurchased and sold during the year:Purchased Value (Rs.)
- In Dividend option:Units in mutual funds of Rs. 10 each
5,000,000.000 units of Reliance Fixed Horizon Fund I 50,000,000Monthly Plan-Series II Dividend Plan
15,006,491.916 units of Reliance Fixed Horizon Fund - 150,064,919Monthly Plan A -Series IV Dividend Option
15,075,739.448 units of Reliance Fixed Horizon Fund - 150,757,394Monthly Plan A -Series V Dividend Option
7,000,000.000 units of Reliance Fixed Horizon Fund Dividend Option 70,000,000
7,034,474.027 units of Reliance Fixed Horizon Fund 70,344,740Monthly Plan A Series II -Dividend Option
5,076,255.500 units of ABN AMRO FTP Series 3 Quarterly Plan D Dividend 50,762,555
5,076,923.310 units of Sundaram BNP Paribas Fixed Term Plan 50,769,233Series IX- Dividend Plan
5,024,112.866 units of TATA Fixed Horizon Fund Series -8 50,241,500Scheme A IP -Dividend
Schedules to the accounts
54 55
Schedules to the accounts
Schedule 9 : InvestmentAs at As at
March 31, 2007 March 31, 2006(Rs.) (Rs.)
Long Term InvestmentsOther than trade investments
A. In Subsidiary Companies (Unquoted)
Fully paid up equity shares of Rs. 10 each
20,000,000 (Previous year 710,000) in CR Retail Malls 200,000,000 7,100,000(India) Private Limited
1,500,000 (Previous year 1,500,000) in PVR Pictures Limited 15,000,000 15,000,000
B. In Government Securities (Unquoted)
6 years National Savings Certificates* 5,548,000 5,000,000(Deposited with Entertainment Tax Authorities)
6 years National Savings Certificates** 45,000 45,000(Deposited with Municipal Corporation of Hyderabad)
Current InvestmentsOther than trade investments (Quoted)***Units in mutual funds of Rs. 10 each
8,318,556.811 (Previous year Nil) units of P32ISD Prudential 83,185,568 -ICICI Liquid Plan - Super Institutional Daily Dividend
15,170,726.024 (Previous year Nil) units of OLPIPD HSBC Liquid Plus- 151,774,513 -Inst. Plus-Daily Dividend
13,022,840.564 (Previous year Nil) units of Reliance Liquidity Fund - daily 130,268,776 -dividend Reinvestment option - Reinvestment
Nil (Previous year 4,092,598.134) units of B503DD Birla Cash Plus - - 41,005,787Institutional Premium - Daily Dividend Reinvestment
Nil (Previous year 5,059,051.637) units of Kotak FMP Series XV - Dividend - 50,590,516Nil (Previous year 10,000,000) units of C93 Chola FMP - - 100,000,000Series 2 (Quarterly Plan-I) - Dividend
Nil (Previous year 5,000,000) units of C95 Chola FMP - Series 2 - 50,000,000(Quarterly Plan-II) - Dividend
Units in mutual funds of Rs. 1,000 each42370.856 (Previous year Nil) units of UTI Liquid Cash Plan Institutional - 43,194,787 -Daily Income Option - Reinvestment
Nil (Previous year 40,520.284) units of DSP Merrill Lynch Liquidity Fund - - 40,528,388Institutional - Daily Dividend
629,016,644 309,269,691
NOTES :1. *Held in the name of the Managing Director in the interest of the Company.2. **Held in the name of the Employee in the interest of the Company.3. ***Invested out of unutilised monies out of issue of share capital and loan proceeds.4. The following units held in mutual funds werepurchased and sold during the year:Purchased Value (Rs.)
- In Dividend option:Units in mutual funds of Rs. 10 each
5,000,000.000 units of Reliance Fixed Horizon Fund I 50,000,000Monthly Plan-Series II Dividend Plan
15,006,491.916 units of Reliance Fixed Horizon Fund - 150,064,919Monthly Plan A -Series IV Dividend Option
15,075,739.448 units of Reliance Fixed Horizon Fund - 150,757,394Monthly Plan A -Series V Dividend Option
7,000,000.000 units of Reliance Fixed Horizon Fund Dividend Option 70,000,000
7,034,474.027 units of Reliance Fixed Horizon Fund 70,344,740Monthly Plan A Series II -Dividend Option
5,076,255.500 units of ABN AMRO FTP Series 3 Quarterly Plan D Dividend 50,762,555
5,076,923.310 units of Sundaram BNP Paribas Fixed Term Plan 50,769,233Series IX- Dividend Plan
5,024,112.866 units of TATA Fixed Horizon Fund Series -8 50,241,500Scheme A IP -Dividend
Schedules to the accounts
7,712,499.816 units of P152RD Pru ICICI FMP Series 32- 77,124,998Three Month Plan -C- Retail Dividend
7,100,589.169 units of Kotak FMP 3M Series 1-Dividend 71,005,900
10,519.040 units of Kotak FMP Series XV - Dividend 105,228
25,764,537.712 units of PFRDD Prudential ICICI Floating Rate Plan D - 257,645,377Daily Dividend14,994,404.654 units of HSBC Cash Fund IP - Daily Dividend 150,028,015
19,865,822.305 units of LIC MF Liquid Fund Dividend Plan 218,128,715
4,954,261.928 units of Sundaram BNP Paribas Money 50,014,760Fund Institutional Daily Dividend Reinvestment
35,063,763.178 units of Reliance liquidity Fund Daily Dividend 350,746,329Reinvestment option (Re-investment) (GS-DP)
7,019,729.360 units of Principal Floating Rate Fund FMP Institutional. 70,202,207Option - Dividend Reinvestment Daily
13,602.648 units of B503DD Birla Cash Plus - 136,292Institutional. Prem. - Daily Dividend - Reinvestment
4,150,599.276 units of Kotak Liquid (Institutional Premium) - 50,753,943Daily Dividend
22,663,282.967 units of P32ISD Prudential ICICI 226,632,830Institutional Liquid Plan -Super Institutional Daily Dividend
15170726.024 units of OLPIPD HSBC Liquid Plus-Inst. Plus - 151,774,513Daily Dividend
Units in mutual funds of Rs. 1000 each
81,105.690 units of DSP Merrill Lynch Fixed Term Plan Series 1 D Dividend 81,105,847
101,017.788 units of G70 Standard Chartered Liquidity Managers- 101,027,890Plus-Daily Dividend
144,387.079 units of UTI Liquid Cash Plan Institutional- 147,194,787Daily Income Option-Re Investment
101,257.74 units of DSP Merrill lynch Liquid Plus IP-Daily Dividend 101,277,992
90,751.561 units of TATA Liquid Super High Investment Fund-Daily Dividend 101,144,430
596.704 units of DSP Merrill Lynch Liquidity Fund - Institutional - Daily Dividend 596,823
Sold - In Dividend option:
Units in mutual funds of Rs. 10 each
5,000,000.000 units of C95 Chola FMP -Series 2 (Quarterly Plan II )-Dividend 50,021,500
10,000,000.000 units of C95 Chola FMP -Series 2 (Quarterly Plan I )-Dividend 100,093,000
5,000,000.000 units of Reliance Fixed Horizon Fund I Monthly Plan-Series II 50,000,000Dividend Plan
15,006,491.916 units of Reliance Fixed Horizon Fund - 150,064,919Monthly Plan A -Series IV Dividend Option
15,075,739.448 units of Reliance Fixed Horizon Fund - Monthly Plan A - 150,757,394Series V Dividend Option
7,000,000.000 units of Reliance Fixed Horizon Fund Dividend Option 70,000,000
7,034,474.027 units of Reliance Fixed Horizon Fund Monthly Plan A Series II - 70,344,740Dividend Option
5,076,255.500 units of ABN AMRO FTP Series 3 Quarterly Plan D Dividend 50,762,555
5,076,923.310 units of Sundaram BP Paribas Fixed Term Plan Series IX- Dividend Plan 50,769,233
5,024,112.866 units of TATA Fixed Horizon Fund Series -8 Scheme A IP -Dividend 50,318,500
7,712,499.816 units of P152RD Pru ICICI FMP Series 32- 77,124,998Three Month Plan -C- Retail Dividend
7,100,589.169 units of Kotak FMP 3M Series 1-Dividend 71,006,478
5,069,570.6775 units of Kotak FMP Series XV - Dividend 50,739,072
25,764,537.712 units of PFRDD Prudential ICICI Floating Rate Plan D - 257,645,377Daily Dividend
14,994,404.654 units of HSBC Cash Fund IP - Daily Dividend 150,028,015
Schedule 9 : Investment (continued)
56
19,865,822.305 units of LIC MF Liquid Fund Dividend Plan 218,128,715
4,954,261.928 units of Sundaram BNP Paribas Money Fund 50,014,760Institutional Daily Dividend Reinvestment
22,040,922.615 units of Reliance Liquidity Fund Daily Dividend 220,477,553Reinvestment option (Re-investment) (GS-DP)
7,019,729.360 units of Principal Floating Rate Fund FMP Institutional. Option - 70,202,207Dividend Reinvestment Daily
4,106,200.781 units of B503DD Birla Cash Plus - Institutional. Prem. - 41,142,079Daily Dividend - Reinvestment
4,150,599.276 units of Kotak Liquid (Institutional Premium) - Daily Dividend 50,753,943
14,344,726.156 units of P32ISD Prudential ICICI Institutional Liquid Plan - 143,447,262Super Institutional Daily Dividend
Units in mutual funds of Rs. 1000 each
81,105.690 units of DSP Merrill Lynch Fixed Term Plan Series 1 D Dividend 81,114,903
101,017.788 units of G70 Standard Chartered Liquidity Managers- 101,027,890Plus-Daily Dividend
102,016.223 units of UTI Liquid Cash Plan Institutional-Daily Income Option - 104,000,000Re Investment
101,257.74 units of DSP Merrill lynch Liquid Plus IP-Daily Dividend 101,277,992
90,751.561 units of TATA Liquid Super High Investment Fund-Daily Dividend 101,144,430
41,116.988 units of DSP Merrill Lynch Liquidity Fund - Institutional - Daily Dividend 41,125,211
March 31, 2007 March 31, 2006
5. Aggregate value of investments
Market Value Cost Market Value Cost
Quoted 408,547,542 408,423,644 284,098,611 282,124,691Unquoted 220,593,000 27,145,000
629,016,644 309,269,691
Schedules to the accounts
Schedule 9 : Investment (continued)
56 57
19,865,822.305 units of LIC MF Liquid Fund Dividend Plan 218,128,715
4,954,261.928 units of Sundaram BNP Paribas Money Fund 50,014,760Institutional Daily Dividend Reinvestment
22,040,922.615 units of Reliance Liquidity Fund Daily Dividend 220,477,553Reinvestment option (Re-investment) (GS-DP)
7,019,729.360 units of Principal Floating Rate Fund FMP Institutional. Option - 70,202,207Dividend Reinvestment Daily
4,106,200.781 units of B503DD Birla Cash Plus - Institutional. Prem. - 41,142,079Daily Dividend - Reinvestment
4,150,599.276 units of Kotak Liquid (Institutional Premium) - Daily Dividend 50,753,943
14,344,726.156 units of P32ISD Prudential ICICI Institutional Liquid Plan - 143,447,262Super Institutional Daily Dividend
Units in mutual funds of Rs. 1000 each
81,105.690 units of DSP Merrill Lynch Fixed Term Plan Series 1 D Dividend 81,114,903
101,017.788 units of G70 Standard Chartered Liquidity Managers- 101,027,890Plus-Daily Dividend
102,016.223 units of UTI Liquid Cash Plan Institutional-Daily Income Option - 104,000,000Re Investment
101,257.74 units of DSP Merrill lynch Liquid Plus IP-Daily Dividend 101,277,992
90,751.561 units of TATA Liquid Super High Investment Fund-Daily Dividend 101,144,430
41,116.988 units of DSP Merrill Lynch Liquidity Fund - Institutional - Daily Dividend 41,125,211
March 31, 2007 March 31, 2006
5. Aggregate value of investments
Market Value Cost Market Value Cost
Quoted 408,547,542 408,423,644 284,098,611 282,124,691Unquoted 220,593,000 27,145,000
629,016,644 309,269,691
Schedules to the accounts Schedules to the accounts
Schedule 10 : InventoriesAs at As at
March 31, 2007 March 31, 2006(Rs.) (Rs.)
Food and beverages 4,802,084 2,408,114Stores and spares 12,813,202 6,838,460
17,615,286 9,246,574
Schedule 11 : Sundry debtorDebts outstanding for a period exceeding six monthsSecured, considered good 1,467,682 180,000Unsecured, considered good 1,534,285 813,545Unsecured, considered doubtful 3,802,710 1,602,381
Other debtsSecured, considered good 1,836,801 3,194,358Unsecured, considered good 50,421,199 24,766,894Unsecured, considered doubtful 77,815 -
59,140,492 30,557,178Less : Provision for doubtful debts 3,880,525 1,602,381
55,259,967 28,954,797
Schedule 12 : Cash and bank balancesCash on hand 7,586,018 3,277,925Cheques on hand 990,065 799,088Balances with scheduled banks:On current accounts 48,632,720 9,616,485On deposit accounts* 12,429,578 614,853,789On unpaid and unclaimed dividend accounts 470,996 -
70,109,377 628,547,287
* Includes unutilised monies out of issue of share capital amounting to Rs. Nil (Previous year Rs. 600,000,000) and fixed deposit receiptspledged with banks amounting to Rs. 12,035,576 (Previous year Rs. 12,727,565).
Schedule 13 : Other current assetsInterest accrued on deposits and others 2,034,661 9,414,601Income accrued for which invoices have been raised subsequently 1,372,999 2,105,546Insurance claims receivable 146,479 67,543
3,554,139 11,587,690
Included in Other Current Assets are:i) Outstanding from a subsidiary, company under the same management 857,031 1,178,487
within the meaning of Section370(1B) of the Companies Act,1956 i.e. CR Retail Malls (India) Private Limited
ii) Maximum amount outstanding from such Company at any time during the year 11,201,788 1,178,487
Schedule 9 : Investment (continued)
58
Schedules to the accounts
Schedule 14 : Loans and advancesAs at As at
March 31, 2007 March 31, 2006(Rs.) (Rs.)
Unsecured, considered goodAdvances recoverable in cash or in kind or for value to be received 68,006,916 32,434,186Inter-corporate loans to subsidiaries 218,000,000 228,071,070Advance against share capital given to a proposed subsidiary 10,000,000 10,000,000Advance payment of Income Tax/Tax Deducted at Source/Tax Refundable 61,498,433 28,324,933Deposits - others 317,474,267 229,475,851Unsecured, considered doubtfulAdvances recoverable in cash or in kind or for value to be received 250,798 250,798
675,230,414 528,556,838Less : Provision for doubtful advances 250,798 250,798
674,979,616 528,306,040
Included in Loans and advances are:i) Outstanding from two subsidiaries, companies under the same management
within the meaning of Section 370(1B) of the Companies Act, 1956 i.e.PVR Pictures Limited 118,000,000 11,500,000CR Retail Malls (India) Private Limited 100,000,000 216,571,070
ii) Maximum amount outstanding from such companies at any time during the yearPVR Pictures Limited 118,000,000 11,500,000CR Retail Malls (India) Private Limited 376,571,296 218,213,803
iii) Outstanding from a private limited company in which some of the directorsof the Company are interested as directors 2,500,000 4,750,000(Previous year two private limited companies)
Schedule 15 : Current LiabilitiesSundry Creditors 221,770,591 191,663,241Unclaimed dividend (statutory liabilities as referred in 470,996 -Section 205C of the Companies Act, 1956)*Book overdraft with a bank - 1,955,084Security deposits 9,391,804 5,368,000Income received in advance (includes amount adjustable after one year Rs. Nil, 18,661,824 23,370,064Previous year Rs. 833,333)Interest accrued but not due on loans 1,669,033 1,597,598
251,964,248 223,953,987
Dues to small scale industrial undertaking included in Sundry creditors - 5,501Dues to other than small scale industrial undertakings included in Sundry creditors 221,770,591 191,657,740Included in Sundry Creditors are:Payable to a subsidiary 556,986 262,284Payable to Directors 482,668 358,300* Shall be transferred to Investor Education and Protection Fund (when due)
Schedule 16 : ProvisionsFor taxation 58,400,262 34,700,000For Interim Dividend- on Equity Shares - 22,877,370- on Preference Shares - 5,219,178For Corporate Dividend Tax - 3,944,852For Fringe Benefit Tax (Net of Payment) 792,646 150,000For Staff benefit schemes - Leave Encashment 5,375,513 3,231,852
- Gratuity 3,847,267 901,056
68,415,688 71,024,308
58 59
Schedules to the accounts
Schedule 14 : Loans and advancesAs at As at
March 31, 2007 March 31, 2006(Rs.) (Rs.)
Unsecured, considered goodAdvances recoverable in cash or in kind or for value to be received 68,006,916 32,434,186Inter-corporate loans to subsidiaries 218,000,000 228,071,070Advance against share capital given to a proposed subsidiary 10,000,000 10,000,000Advance payment of Income Tax/Tax Deducted at Source/Tax Refundable 61,498,433 28,324,933Deposits - others 317,474,267 229,475,851Unsecured, considered doubtfulAdvances recoverable in cash or in kind or for value to be received 250,798 250,798
675,230,414 528,556,838Less : Provision for doubtful advances 250,798 250,798
674,979,616 528,306,040
Included in Loans and advances are:i) Outstanding from two subsidiaries, companies under the same management
within the meaning of Section 370(1B) of the Companies Act, 1956 i.e.PVR Pictures Limited 118,000,000 11,500,000CR Retail Malls (India) Private Limited 100,000,000 216,571,070
ii) Maximum amount outstanding from such companies at any time during the yearPVR Pictures Limited 118,000,000 11,500,000CR Retail Malls (India) Private Limited 376,571,296 218,213,803
iii) Outstanding from a private limited company in which some of the directorsof the Company are interested as directors 2,500,000 4,750,000(Previous year two private limited companies)
Schedule 15 : Current LiabilitiesSundry Creditors 221,770,591 191,663,241Unclaimed dividend (statutory liabilities as referred in 470,996 -Section 205C of the Companies Act, 1956)*Book overdraft with a bank - 1,955,084Security deposits 9,391,804 5,368,000Income received in advance (includes amount adjustable after one year Rs. Nil, 18,661,824 23,370,064Previous year Rs. 833,333)Interest accrued but not due on loans 1,669,033 1,597,598
251,964,248 223,953,987
Dues to small scale industrial undertaking included in Sundry creditors - 5,501Dues to other than small scale industrial undertakings included in Sundry creditors 221,770,591 191,657,740Included in Sundry Creditors are:Payable to a subsidiary 556,986 262,284Payable to Directors 482,668 358,300* Shall be transferred to Investor Education and Protection Fund (when due)
Schedule 16 : ProvisionsFor taxation 58,400,262 34,700,000For Interim Dividend- on Equity Shares - 22,877,370- on Preference Shares - 5,219,178For Corporate Dividend Tax - 3,944,852For Fringe Benefit Tax (Net of Payment) 792,646 150,000For Staff benefit schemes - Leave Encashment 5,375,513 3,231,852
- Gratuity 3,847,267 901,056
68,415,688 71,024,308
Schedules to the accounts
Schedule 17 : Miscellaneous ExpenditureAs at As at
March 31, 2007 March 31, 2006(Rs.) (Rs.)
Miscellanous expenditure (To the extent not written off)Share/debenture placement expensesAs per last account - 5,416,843Add: Incurred during the year - 113,195,755
- 118,612,598Less: Written off during the year - 118,612,598
- -
NOTES:
1. The Company had, during the previous year incurred expenses amounting to Rs. 113,195,755 for the initial public offering (IPO) of5,700,000 equity shares (excluding sale of 2,000,000 equity shares held by an existing shareholder). The share placement expensesincurred on above issue was adjusted against securities premium account in the previous year.
2. Expenses incurred on the initial public offering, during the previous year included Rs. 4,866,240 paid to statutory auditors towardscertification charges etc. and Rs. 158,254 paid as fringe benefit tax.
Schedule 18 : Operating Income
Income from sale of tickets of films (including entertainment tax collected 1,216,957,384 880,052,280Rs. 291,582,187, Previous year Rs. 224,379,377)Income from Revenue Sharing 190,043,320 48,884,692Income from sale of film rights and distribution of films - 1,958,175Sale of food and beverages (including sales tax collected Rs. 40,692,112, Previous 373,452,389 240,076,617year Rs. 26,779,327)Advertisement (Gross Tax Deducted at source Rs. 4,963,656, Previous year 181,059,767 94,062,849Rs. 2,787,728)Royalty Income (to the extent of pouring fee, from a customer) (Gross Tax Deducted 15,874,775 12,036,768at source Rs. 670,956, Previous year Rs. Nil)Management fees (Gross Tax Deducted at source Rs. 242,469, Previous year 8,678,225 8,691,643Rs. 386,528) (including service tax collected Rs. 955,695, Previous yearRs. 799,107)
1,986,065,860 1,285,763,024
Schedule 19 : Other Income
InterestOn bank deposits (Gross, Tax Deducted at Source Rs. 2,230,429, 10,354,979 11,071,161Previous year Rs. 2,472,685)On long term investments - Non Trade (Gross, Tax Deducted at Source Rs. Nil, 492,247 442,662Previous year Rs. Nil)From subsidiaries (Gross, Tax Deducted at Source Rs. 4,836,675, 21,557,678 1,930,820Previous year Rs. 451,226)From others (Gross, Tax Deducted at Source Rs. Nil, Previous year Rs. Nil) 701,094 -Dividend income (from current investments - other than trade) 26,060,706 3,391,096Profit on sale of Current Investments - other than trade 242,763 -Rent received 3,754,199 -Royalty Income (to the extent of sign on fee, from a customer) 4,707,264 5,394,004Foreign exchange fluctuation (net) - 34,965Miscellaneous income (Gross, Tax Deducted at Source Rs. Nil, Previous year 10,825,540 7,824,533Rs. 22,997)
78,696,470 30,089,241
Schedule 20 : Personnel Expenses
Salary and other allowances 164,388,702 103,123,019Contribution to gratuity fund 3,771,802 1,727,917Contribution to provident and other funds 16,164,247 10,152,459Staff welfare expenses 8,409,979 6,604,279
192,734,730 121,607,674
60
Schedules to the accounts
Schedule 21 : Operating and other expensesAs at As at
March 31, 2007 March 31, 2006(Rs.) (Rs.)
Rent (net of receipt from sub-lessees of Rs. 16,075,502, 177,144,336 114,404,254Previous year Rs. 14,074,573)Rates and taxes 7,988,447 5,623,803Communication costs 16,417,732 8,819,818Professional charges 18,086,333 11,467,891Advertisement and publicity (excluding Rs. 28,229,326, 70,048,508 44,719,299Previous year Rs. 23,540,874 borne by other co-sponsors)Business promotion and entertainment 2,226,836 3,175,581Travelling and conveyance 35,573,156 18,830,565Printing and stationery 9,483,906 6,493,993Insurance 7,436,269 5,190,407Repairs and maintenance :- Buildings 27,197,282 11,238,792- Plant & Machinery 16,309,327 13,069,886- Common area maintenance 90,443,457 61,355,837- Others 8,821,833 7,350,110Electricity and water charges 94,823,047 48,998,346Auditor’s remuneration- Audit fee 1,741,580 1,290,760- Tax audit fee 280,900 224,480- Quarterly limited review of accounts 1,010,160 220,400- Certification etc. 123,464 418,350- Out-of-pocket expenses 28,141 3,184,245 57,670Security service charges 19,695,965 12,308,626Discount on sales 971,113 1,068,235Donations 527,525 171,000Irrecoverable balances written off (net) 173,152 -Provision for doubtful debts 2,278,143 1,602,381Loss on sale/discard of fixed assets (net) 1,246,098 2,515,492Loss on sale of current investments - other than trade - 35,506Directors Sitting Fees 440,000 320,000Bank and other charges 5,992,286 3,751,007Miscellaneous expenses 18,552,070 11,312,578
635,061,066 396,035,067
Rent includes amount paid to directors 4,374,000 4,374,000
Schedule 22 : Interest paidIntereston fixed loans and debentures 54,544,491 30,890,193to banks and others 417,781 1,366,416
54,962,272 32,256,609
60 61
Schedules to the accounts
Schedule 21 : Operating and other expensesAs at As at
March 31, 2007 March 31, 2006(Rs.) (Rs.)
Rent (net of receipt from sub-lessees of Rs. 16,075,502, 177,144,336 114,404,254Previous year Rs. 14,074,573)Rates and taxes 7,988,447 5,623,803Communication costs 16,417,732 8,819,818Professional charges 18,086,333 11,467,891Advertisement and publicity (excluding Rs. 28,229,326, 70,048,508 44,719,299Previous year Rs. 23,540,874 borne by other co-sponsors)Business promotion and entertainment 2,226,836 3,175,581Travelling and conveyance 35,573,156 18,830,565Printing and stationery 9,483,906 6,493,993Insurance 7,436,269 5,190,407Repairs and maintenance :- Buildings 27,197,282 11,238,792- Plant & Machinery 16,309,327 13,069,886- Common area maintenance 90,443,457 61,355,837- Others 8,821,833 7,350,110Electricity and water charges 94,823,047 48,998,346Auditor’s remuneration- Audit fee 1,741,580 1,290,760- Tax audit fee 280,900 224,480- Quarterly limited review of accounts 1,010,160 220,400- Certification etc. 123,464 418,350- Out-of-pocket expenses 28,141 3,184,245 57,670Security service charges 19,695,965 12,308,626Discount on sales 971,113 1,068,235Donations 527,525 171,000Irrecoverable balances written off (net) 173,152 -Provision for doubtful debts 2,278,143 1,602,381Loss on sale/discard of fixed assets (net) 1,246,098 2,515,492Loss on sale of current investments - other than trade - 35,506Directors Sitting Fees 440,000 320,000Bank and other charges 5,992,286 3,751,007Miscellaneous expenses 18,552,070 11,312,578
635,061,066 396,035,067
Rent includes amount paid to directors 4,374,000 4,374,000
Schedule 22 : Interest paidIntereston fixed loans and debentures 54,544,491 30,890,193to banks and others 417,781 1,366,416
54,962,272 32,256,609
Schedules to the accounts
Schedule 23 : Earning per share (EPS)As at As at
March 31, 2007 March 31, 2006(Rs.) (Rs.)
Net profit as per profit and loss account 105,623,097 54,763,866Less: Dividend on Preference Shares and tax thereon 11,402,500 5,951,168
Net Profit for calculation of basic and diluted EPS 94,220,597 48,812,698
Weighted average number of equity shares in calculating basic EPS:Number of equity shares outstanding at the beginning of the year 22,877,370 17,097,370Equity shares allotted on January 31, 2007 (outstanding for 59 days) 38,000 -Equity shares allotted on March 31, 2007 (outstanding for 1 day) 98,500 -Equity shares allotted on September 22, 2005 (outstanding for 191 days) - 80,000Equity shares allotted on December 27, 2005 (outstanding for 95 days) - 5,700,000Number of equity shares outstanding at the end of the year 23,013,870 22,877,370
Weighted number of equity shares of Rs. 10 each outstanding during the year 22,883,782 18,622,795
Weighted average number of equity shares in calculating diluted EPS:Weighted number of equity shares of Rs. 10 each 22,883,782 18,622,795outstanding during the year (as above)Add: Effect of stock options - 33,593
Weighted number of equity shares of Rs. 10 each outstanding during the year 22,883,782 18,656,388
Basic Earnings Per Share 4.12 2.62Diluted Earnings Per Share 4.12 2.62
62
Schedule 24: Notes to theAccounts1. Nature of Operations
PVR Limited is in the business of film exhibition. The Company
also earns revenue from in- cinema advertisements/product
displays and in-cinema sale of food and beverages.
2. Statement of Significant Accounting Policies
(a) Basis of preparation
The financial statements are prepared to comply in all material
respects with the mandatory Accounting Standards issued by the
Institute of Chartered Accountants of India and the relevant
provisions of the Companies Act, 1956. The financial statements
are prepared under the historical cost convention on an accrual
basis. The accounting policies have been consistently applied by
the Company and except for the change in accounting policy
disclosed more fully below, are consistent with those used in the
previous year.
(b) Change in Accounting Policy
Till March 31, 2006 Company was providing for leave benefits
based on actuarial valuation in accordance with old Accounting
Standard 15. In the current year, the Company has opted for
early adoption of the Accounting Standard 15 (Revised 2005)
which is otherwise mandatory for accounting periods commencing
on or after December 7, 2006. Accordingly the Company has
changed the basis of providing short term leave benefits. As a
result, actuarial valuation of leave as at April 1, 2006 is higher by
Rs. 270,219 (net of income-tax Rs. 137,106) which in
accordance with the transitional provision in the revised
Accounting Standard, has been adjusted to the opening balance of
Profit and Loss Account. This change does not have material
impact on the profit for the current year.
(c) Fixed Assets
Fixed Assets are stated at Cost less accumulated depreciation and
impairment losses, if any. Cost comprises the purchase price and
any directly attributable cost of bringing the asset in its working
condition for its intended use. Financing costs relating to acquisition
of qualifying Fixed Assets are also included to the extent they relate
to the period till such assets are ready for their intended use.
Leasehold improvements represent expenses incurred towards
civil works, interior furnishings, etc. on the leased premises at the
various locations.
(d) Depreciation
Leasehold Improvements are amortized over the estimated useful
life or unexpired period of lease (whichever is lower) on a straight
line basis.
Cost of structural improvements at premises where Company
has entered into agreement with the parties to operate and
manage Multiscreen/Single Screen Cinemas on revenue sharing
basis are amortized over the estimated useful life or lock in period
of the agreement (whichever is lower) on a straight line basis
Depreciation on all other assets is provided on Straight-Line
Method at the rates computed based on estimated useful life of the
assets, which are equal to the corresponding rates prescribed in
Schedule XIV to the Companies Act, 1956. Depreciation on
additions/deletions to fixed assets due to foreign exchange
fluctuation is provided/adjusted over the remaining useful life of
such assets.
Assets costing Rs. 5,000 and below are fully depreciated in the
year of acquisition.
Notes to the accounts
(e) Intangibles
Software
Cost relating to purchased softwares is capitalised and is
amortised on a Straight-Line Basis over their estimated useful lives
of six years.
Software licenses costing Rs. 5,000 and below are fully
depreciated in the year of acquisition.
Film Right’s Cost
Film right cost is capitalized and is amortised fully as and when the
film is released.
(f) Expenditure on new projects and substantial
expansion
Expenditure directly relating to construction activity is capitalised.
Indirect expenditure incurred during construction period is
capitalised as part of the indirect construction cost to the extent
expenditure is related to construction or is incidental thereto.
Other indirect expenditure (including borrowing costs) incurred
during the construction period, which is not related to the
construction activity nor is incidental thereto is charged to the
Profit and Loss Account. Income earned during construction
period is adjusted against the total of the indirect expenditure.
All direct capital expenditure on expansion is capitalised.
As regards indirect expenditure on expansion, only that portion is
capitalised which represents the marginal increase in such
expenditure involved as a result of capital expansion. Both direct
and indirect expenditure are capitalised only if they increase the
value of the asset beyond its originally assessed standard of
performance.
(g) Investments
Investments that are readily realizable and intended to be held for
not more than a year are classified as current investments.
All other investments are classified as long term investments.
Current investments are carried at lower of cost and fair value
determined on an individual investment basis. Long term
investments are carried at cost. However, provision for
diminution in the value is made to recognize a decline other
than temporary in the value of the investments.
(h) Inventories
Inventories are valued as follows:
Food and Lower of cost and net realizable
beverages value. Cost is determined on First In
First Out Basis.
Stores and spares Lower of cost and net realizable value.
Cost is determined on First In First
Out Basis.
Net realizable value is the estimated selling price in the
ordinary course of business, less estimated costs necessary to
make the sale.
(i) Leases
Where the Company is the lessee
Finance leases, which effectively transfer to the Company
substantially all the risks and benefits incidental to ownership of the
leased item, are capitalized at the lower of the fair value and
present value of the minimum lease payments at the inception of
the lease term and disclosed as leased assets. Lease payments are
apportioned between the finance charges and reduction of the
lease liability based on the implicit rate of return. Finance charges
are charged directly against income. Lease management fees,
legal charges and other initial direct costs are capitalised.
62 63
Schedule 24: Notes to theAccounts
1. Nature of Operations
PVR Limited is in the business of film exhibition. The Company
also earns revenue from in- cinema advertisements/product
displays and in-cinema sale of food and beverages.
2. Statement of Significant Accounting Policies
(a) Basis of preparation
The financial statements are prepared to comply in all material
respects with the mandatory Accounting Standards issued by the
Institute of Chartered Accountants of India and the relevant
provisions of the Companies Act, 1956. The financial statements
are prepared under the historical cost convention on an accrual
basis. The accounting policies have been consistently applied by
the Company and except for the change in accounting policy
disclosed more fully below, are consistent with those used in the
previous year.
(b) Change in Accounting Policy
Till March 31, 2006 Company was providing for leave benefits
based on actuarial valuation in accordance with old Accounting
Standard 15. In the current year, the Company has opted for
early adoption of the Accounting Standard 15 (Revised 2005)
which is otherwise mandatory for accounting periods commencing
on or after December 7, 2006. Accordingly the Company has
changed the basis of providing short term leave benefits. As a
result, actuarial valuation of leave as at April 1, 2006 is higher by
Rs. 270,219 (net of income-tax Rs. 137,106) which in
accordance with the transitional provision in the revised
Accounting Standard, has been adjusted to the opening balance of
Profit and Loss Account. This change does not have material
impact on the profit for the current year.
(c) Fixed Assets
Fixed Assets are stated at Cost less accumulated depreciation and
impairment losses, if any. Cost comprises the purchase price and
any directly attributable cost of bringing the asset in its working
condition for its intended use. Financing costs relating to acquisition
of qualifying Fixed Assets are also included to the extent they relate
to the period till such assets are ready for their intended use.
Leasehold improvements represent expenses incurred towards
civil works, interior furnishings, etc. on the leased premises at the
various locations.
(d) Depreciation
Leasehold Improvements are amortized over the estimated useful
life or unexpired period of lease (whichever is lower) on a straight
line basis.
Cost of structural improvements at premises where Company
has entered into agreement with the parties to operate and
manage Multiscreen/Single Screen Cinemas on revenue sharing
basis are amortized over the estimated useful life or lock in period
of the agreement (whichever is lower) on a straight line basis
Depreciation on all other assets is provided on Straight-Line
Method at the rates computed based on estimated useful life of the
assets, which are equal to the corresponding rates prescribed in
Schedule XIV to the Companies Act, 1956. Depreciation on
additions/deletions to fixed assets due to foreign exchange
fluctuation is provided/adjusted over the remaining useful life of
such assets.
Assets costing Rs. 5,000 and below are fully depreciated in the
year of acquisition.
Notes to the accounts
(e) Intangibles
Software
Cost relating to purchased softwares is capitalised and is
amortised on a Straight-Line Basis over their estimated useful lives
of six years.
Software licenses costing Rs. 5,000 and below are fully
depreciated in the year of acquisition.
Film Right’s Cost
Film right cost is capitalized and is amortised fully as and when the
film is released.
(f) Expenditure on new projects and substantial
expansion
Expenditure directly relating to construction activity is capitalised.
Indirect expenditure incurred during construction period is
capitalised as part of the indirect construction cost to the extent
expenditure is related to construction or is incidental thereto.
Other indirect expenditure (including borrowing costs) incurred
during the construction period, which is not related to the
construction activity nor is incidental thereto is charged to the
Profit and Loss Account. Income earned during construction
period is adjusted against the total of the indirect expenditure.
All direct capital expenditure on expansion is capitalised.
As regards indirect expenditure on expansion, only that portion is
capitalised which represents the marginal increase in such
expenditure involved as a result of capital expansion. Both direct
and indirect expenditure are capitalised only if they increase the
value of the asset beyond its originally assessed standard of
performance.
(g) Investments
Investments that are readily realizable and intended to be held for
not more than a year are classified as current investments.
All other investments are classified as long term investments.
Current investments are carried at lower of cost and fair value
determined on an individual investment basis. Long term
investments are carried at cost. However, provision for
diminution in the value is made to recognize a decline other
than temporary in the value of the investments.
(h) Inventories
Inventories are valued as follows:
Food and Lower of cost and net realizable
beverages value. Cost is determined on First In
First Out Basis.
Stores and spares Lower of cost and net realizable value.
Cost is determined on First In First
Out Basis.
Net realizable value is the estimated selling price in the
ordinary course of business, less estimated costs necessary to
make the sale.
(i) Leases
Where the Company is the lessee
Finance leases, which effectively transfer to the Company
substantially all the risks and benefits incidental to ownership of the
leased item, are capitalized at the lower of the fair value and
present value of the minimum lease payments at the inception of
the lease term and disclosed as leased assets. Lease payments are
apportioned between the finance charges and reduction of the
lease liability based on the implicit rate of return. Finance charges
are charged directly against income. Lease management fees,
legal charges and other initial direct costs are capitalised.
If there is no reasonable certainty that the Company will obtain
the ownership by the end of the lease term, capitalized leased
assets are depreciated over the shorter of the estimated useful life
of the asset or the lease term.
Leases where the lessor effectively retains substantially all the risks
and benefits of ownership of the leased term, are classified as
operating leases. Operating lease payments are recognized as an
expense in the Profit and Loss Account on a straight-line basis
over the lease term.
Where the Company is the lessor
Assets given under a finance lease are recognised as a receivable
at an amount equal to the net investment in the lease. Lease
rentals are apportioned between principal and interest on the IRR
method. The principal amount received reduces the net
investment in the lease and interest is recognised as revenue.
Initial direct costs such as legal costs, brokerage costs, etc. are
recognised immediately in the Profit and Loss Account.
Assets subject to operating leases are included in fixed assets.
Lease income is recognised in the Profit and Loss Account on a
straight-line basis over the lease term. Costs, including
depreciation are recognised as an expense in the Profit and Loss
Account. Initial direct costs such as legal costs, brokerage costs,
etc. are recognised immediately in the Profit and Loss Account.
(j) Revenue recognition
Revenue is recognized to the extent that it is probable that the
economic benefits will flow to the Company and the revenue can
be reliably measured. Amount of entertainment tax, sales tax and
service tax collected on generating operating revenue has been
shown as a reduction from the operating revenue.
Sale of Tickets of Films
Revenue from sale of tickets of films is recognised as and when the
film is exhibited.
Sale of Food and Beverages
Revenue from sale of food and beverages is recognised upon
passage of title to customers, which coincides with their delivery.
Income from Distribution of films
Theatrical revenue from the distribution of films is accounted for
on the basis of box office reports received from various exhibitors
and revenue from the sale of satellite / TV rights is recognised at
the time of initial period of transfer of right to the customer.
Sharing Revenue
Income from revenue sharing is recognized in accordance with the
terms of agreement with parties to operate and manage
Multiscreen/ Single screen Cinemas, namely PVR EDM, PVR
Lucknow, PVR Indore, PVR Mullund and PVR Aligarh in
coordinated manner.
Advertisement Revenue
Advertisement revenue is recognised as and when advertisement
is displayed at the cinema halls.
Royalty income (to the extent of Pouring Fee, from a
customer) and Management Fee Revenue
Revenue is recognised on an accrual basis in accordance with the
terms of the relevant agreements.
Royalty income (to the extent of Sign on Fee from customers)
Revenue of one time sign on fee from customers is recognized on
an annual basis as per the agreements. The amount of sign on fee
received for unexpired period of agreements is deferred, which is
recognized in the relevant year to which it pertains.
Interest Income
Interest revenue is recognised on a time proportion basis, taking
into account the amount outstanding and the rates applicable.
Dividend Income
Revenue is recognized where the shareholder’s right to receive
payment is established by the balance sheet date.
Rent Income
Revenue from rent is recognized based upon the contract, for the
period the property has been let out.
(k) Foreign currency transactions
(i) Initial Recognition
Foreign currency transactions are recorded in Indian Rupees by
applying to the foreign currency amount, the exchange rate
between the Indian Rupee and the foreign currency prevailing at
the date of the transaction.
(ii) Conversion
Foreign currency monetary items are reported using the closing
rate. Non-monetary items which are carried in terms of historical
cost denominated in a foreign currency, are reported using the
exchange rate at the date of the transaction and non-monetary
items which are carried at fair value or other similar valuation
denominated in a foreign currency are reported using the
exchange rates that existed when the values were determined.
(iii) Exchange Differences
Exchange differences arising on the settlement of monetary items
at rates different from those at which they were initially recorded
during the year, or reported in previous financial statements, are
recognized as income or as expense in the year in which they
arise except gain or loss on transactions relating to acquisition of
Fixed Assets/Intangibles from outside India, which is adjusted to the
carrying amount of the Fixed Assets/Intangibles.
(l) Retirement and other employee benefits
i. Retirement benefits in the form of Provident Fund is a defined
contribution scheme and the contributions are charged to the
Profit and Loss Account of the year when the contributions to the
respective funds are due. There are no other obligations other
than the contribution payable to the respective trusts.
ii. Gratuity is a defined benefit obligation. The Company has
created an approved gratuity fund for the future payment of
gratuity to the employees. The Company accounts for the gratuity
liability, based upon the actuarial valuation carried out at the year
end, by an independent actuary. Gratuity liability of an employee,
who leaves the Company before the close of the year and which
is remaining unpaid, is provided on actual computation basis.
iii. Short term compensated absences are provided for on based
on estimates. Long term compensated balances are provided for
based on actuarial valuation. Leave encashment liability of an
employee, who leaves the Company before the close of the year
and which is remaining unpaid, is provided for on actual
computation basis.
iv. Actuarial gains/losses are immediately taken to profit and loss
account and are not deferred.
(m) Income taxes
Tax expense comprises of current, deferred and fringe benefit tax.
Current income tax and fringe benefit tax is measured at the
amount expected to be paid to the tax authorities in accordance
with the Indian Income Tax Act. Deferred income taxes reflect the
impact of current year timing differences between taxable income
and accounting income for the year and reversal of timing
differences of earlier years.
Notes to the accounts
64
Deferred tax is measured based on the tax rates and the tax laws
enacted or substantively enacted at the balance sheet date.
Deferred tax assets are recognised only to the extent that there is
reasonable certainty that sufficient future taxable income will be
available against which such deferred tax assets can be realised. In
case where the Company has unabsorbed depreciation or carry
forward tax losses, entire deferred tax assets are recognised only
if there is virtual certainty supported by convincing evidence that
they can be realised against future taxable profits. Unrealised
deferred tax assets of earlier years are re-assessed and
recognized to the extent that it has become reasonably certain or
virtually certain, as the case may be that sufficient future taxable
income will be available against which such deferred tax assets can
be realised.
(n) Earning Per share
Basic Earnings Per Share is calculated by dividing the net profit or
loss for the year attributable to equity shareholders (after
deducting dividend on preference shares and attributable taxes) by
the weighted average number of equity shares outstanding during
the year. The weighted average number of equity shares
outstanding during the year are adjusted for events of bonus issue;
bonus element in a rights issue to existing shareholders; share
split; and reverse share split (consolidation of shares). Partly paid
equity shares are treated as a fraction of an equity share to the
extent that they were entitled to participate in dividends relative to
a fully paid equity share during the reporting year. For the purpose
of calculating Diluted Earnings Per Share, the net profit or loss for
the year attributable to equity shareholders and the weighted
average number of shares outstanding during the year are
adjusted for the effects of all dilutive potential equity shares.
(o) Impairment
The carrying amounts of assets are reviewed at each balance
sheet date if there is any indication of impairment based on
internal/external factors. An impairment loss is recognized
wherever the carrying amount of an asset exceeds its recoverable
amount. The recoverable amount is the greater of the asset’s net
selling price and value in use. In assessing value in use, the
estimated future cash flows are discounted to its present value at
the weighted average cost of capital.
(p) Provisions
A provision is recognised when the Company has a present
obligation as a result of past event and it is probable that an
outflow of resources will be required to settle the obligation, in
respect of which a reliable estimate can be made. Provisions
except those disclosed elsewhere in the financial statements, are
not discounted to their present value and are determined based on
best management estimate required to settle the obligation at
each Balance Sheet date. These are reviewed at each Balance
Sheet date and are adjusted to reflect the current best
management estimates.
(q) Cash and Cash equivalents
Cash and cash equivalents in the cash flow statement
comprise cash at bank and in hand and short term
investments with an original maturity of three months
or less.
(r) Employee Stock Compensation Cost
Measurement and disclosure of the employee share-based
payment plans is done in accordance with the Guidance Note on
Accounting for Employee Share-based Payments, issued by the
Institute of Chartered Accountants of India. The Company
measures compensation cost relating to employee stock options
using the intrinsic value method. Compensation expense is
amortized over the vesting period of the option on a straight line
basis.
3. Segment Information
Business Segments:
The Company is engaged in the business of film exhibition. The
entire operations are governed by the same set of risk and
returns, hence, the same has been considered as representing a
single primary segment. The said treatment is in accordance with
the guiding principles enunciated in the Accounting Standard – 17
on Segment Reporting.
Geographical Segments:
The following is the distribution of the Company’s consolidated
revenue by geographical markets, regardless of where the
expense against the same has been incurred.
March 31, 2007 March 31, 2006
(Rs.) (Rs.)
Domestic Market 1,985,730,080 1,283,804,849
Overseas Markets - 1,958,175
Total 1,985,730,080 1,285,763,024
The following table shows the carrying amount of debtors by
geographical market.
March 31, 2007 March 31, 2006
(Rs.) (Rs.)
Domestic Market 60,513,491 32,662,724
Overseas Markets - -
Total 60,513,491 32,662,724
The Company has common fixed assets for providing services to
domestic as well as overseas markets. Hence, separate figures for
fixed assets/additions to fixed assets have not been furnished.
Notes to the accounts
64 65
Deferred tax is measured based on the tax rates and the tax laws
enacted or substantively enacted at the balance sheet date.
Deferred tax assets are recognised only to the extent that there is
reasonable certainty that sufficient future taxable income will be
available against which such deferred tax assets can be realised. In
case where the Company has unabsorbed depreciation or carry
forward tax losses, entire deferred tax assets are recognised only
if there is virtual certainty supported by convincing evidence that
they can be realised against future taxable profits. Unrealised
deferred tax assets of earlier years are re-assessed and
recognized to the extent that it has become reasonably certain or
virtually certain, as the case may be that sufficient future taxable
income will be available against which such deferred tax assets can
be realised.
(n) Earning Per share
Basic Earnings Per Share is calculated by dividing the net profit or
loss for the year attributable to equity shareholders (after
deducting dividend on preference shares and attributable taxes) by
the weighted average number of equity shares outstanding during
the year. The weighted average number of equity shares
outstanding during the year are adjusted for events of bonus issue;
bonus element in a rights issue to existing shareholders; share
split; and reverse share split (consolidation of shares). Partly paid
equity shares are treated as a fraction of an equity share to the
extent that they were entitled to participate in dividends relative to
a fully paid equity share during the reporting year. For the purpose
of calculating Diluted Earnings Per Share, the net profit or loss for
the year attributable to equity shareholders and the weighted
average number of shares outstanding during the year are
adjusted for the effects of all dilutive potential equity shares.
(o) Impairment
The carrying amounts of assets are reviewed at each balance
sheet date if there is any indication of impairment based on
internal/external factors. An impairment loss is recognized
wherever the carrying amount of an asset exceeds its recoverable
amount. The recoverable amount is the greater of the asset’s net
selling price and value in use. In assessing value in use, the
estimated future cash flows are discounted to its present value at
the weighted average cost of capital.
(p) Provisions
A provision is recognised when the Company has a present
obligation as a result of past event and it is probable that an
outflow of resources will be required to settle the obligation, in
respect of which a reliable estimate can be made. Provisions
except those disclosed elsewhere in the financial statements, are
not discounted to their present value and are determined based on
best management estimate required to settle the obligation at
each Balance Sheet date. These are reviewed at each Balance
Sheet date and are adjusted to reflect the current best
management estimates.
(q) Cash and Cash equivalents
Cash and cash equivalents in the cash flow statement
comprise cash at bank and in hand and short term
investments with an original maturity of three months
or less.
(r) Employee Stock Compensation Cost
Measurement and disclosure of the employee share-based
payment plans is done in accordance with the Guidance Note on
Accounting for Employee Share-based Payments, issued by the
Institute of Chartered Accountants of India. The Company
measures compensation cost relating to employee stock options
using the intrinsic value method. Compensation expense is
amortized over the vesting period of the option on a straight line
basis.
3. Segment Information
Business Segments:
The Company is engaged in the business of film exhibition. The
entire operations are governed by the same set of risk and
returns, hence, the same has been considered as representing a
single primary segment. The said treatment is in accordance with
the guiding principles enunciated in the Accounting Standard – 17
on Segment Reporting.
Geographical Segments:
The following is the distribution of the Company’s consolidated
revenue by geographical markets, regardless of where the
expense against the same has been incurred.
March 31, 2007 March 31, 2006
(Rs.) (Rs.)
Domestic Market 1,985,730,080 1,283,804,849
Overseas Markets - 1,958,175
Total 1,985,730,080 1,285,763,024
The following table shows the carrying amount of debtors by
geographical market.
March 31, 2007 March 31, 2006
(Rs.) (Rs.)
Domestic Market 60,513,491 32,662,724
Overseas Markets - -
Total 60,513,491 32,662,724
The Company has common fixed assets for providing services to
domestic as well as overseas markets. Hence, separate figures for
fixed assets/additions to fixed assets have not been furnished.
Notes to the accounts4
. R
ela
ted
Part
y D
isclo
sure
Subs
idia
ry C
ompa
nies
Ente
rpris
es h
avin
g co
ntro
lKe
y Man
agem
ent P
erso
nnel
Rela
tives
of K
eyEn
terp
rises
own
ed o
r sig
nific
antly
Gran
d To
tal
or s
igni
fican
t inf
luen
ce(M
anag
ing
Dire
ctor
and
Man
agem
ent P
erso
nnel
influ
ence
d by
key
man
agem
ent
over
the C
ompa
nyJo
int M
anag
ing
Dire
ctor
)pe
rson
nel o
r the
ir re
lativ
es
31-M
ar-0
731
-Mar
-06
31-M
ar-0
731
-Mar
-06
31-M
ar-0
731
-Mar
-06
31-M
ar-0
731
-Mar
-06
31-M
ar-0
731
-Mar
-06
31-M
ar-0
731
-Mar
-06
Tran
sact
ions
dur
ing
the y
ear
Rem
uner
atio
n pa
idAj
ay B
ijli
--
--
6,45
1,20
06,
451,
200
--
--
6,45
1,20
06,
451,
200
Sanj
eev K
umar
--
--
3,42
7,20
03,
427,
200
- -
3,4
27,2
00 3
,427
,200
Rent
Ex
pens
ePr
iya
Exhi
bito
rs P
riva
te L
imite
d -
- 14
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,295
11,0
39,6
80 -
- -
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80Le
isur
e Wor
ld L
imite
d -
- -
- -
- 14
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,000
9,4
44,0
00 14
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,000
9,4
44,0
00Aj
ay B
ijli
- -
- -
3,4
56,0
00 3
,456
,000
- -
3,4
56,0
00 3
,456
,000
Sanj
eev K
umar
- -
- -
1,83
6,00
0 1,
836,
000
- -
1,83
6,00
0 1,
836,
000
Film
D
istr
ibut
ors
Shar
e ex
pens
e(n
et
of
reco
very
to
war
ds
publ
icit
y)PV
R Pi
ctur
es L
imite
d 3
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9,04
1 17
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- -
31,
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17,7
10,9
66PV
R Fa
ctor
y Dist
ribut
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Netw
ork
- -
- -
- -
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526,
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- 1,
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Fixe
d As
sets
Pu
rcha
sed
Priy
a Ex
hibi
tors
Pri
vate
Lim
ited
- -
- 1,
800,
000
- -
- -
- 1,
800,
000
Purc
hase
of
Sh
ares
of
a
Subs
idia
ryAj
ay B
ijli
- -
- -
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00 -
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Sanj
eev K
umar
- -
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00 -
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,000
Sand
hura
o Bi
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- -
- -
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- -
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,000
Inte
rim
D
ivid
end
Paid
fo
r 20
05-0
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vest
men
ts P
riva
te L
imite
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iya
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bito
rs P
riva
te L
imite
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ijli
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- -
- -
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0 -
Sanj
eev K
umar
- -
- -
100
- -
- -
- 10
0 -
Sand
hura
o Bi
jli -
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0 -
- -
100
-Se
lena
Bijl
i -
- -
- -
- 10
0 -
- -
100
-In
teri
m
Div
iden
d Pa
id
for
2006
-07
Bijli
Inve
stm
ents
Pri
vate
Lim
ited
- -
4,9
20,7
68 -
- -
- -
- -
4,9
20,7
68 -
Priy
a Ex
hibi
tors
Pri
vate
Lim
ited
- -
4,3
30,0
00 -
- -
- -
- -
4,3
30,0
00 -
Ajay
Bijl
i -
- -
- 1
8,17
2 -
- -
- -
18,
172
-In
fusi
on
of
Pref
eren
ce
Shar
e Ca
pita
lAj
ay B
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- -
- -
- 10
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0,00
0 -
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106,
420,
000
Wes
tern
Indi
a Tr
uste
e and
Exe
cuto
rCo
mpa
ny L
imite
d (I
ndia
Adv
anta
ge F
und-
1) -
- -
93,
580,
000
- -
- -
- 9
3,58
0,00
0In
fusi
on
of
Equi
ty(i
nclu
ding
sh
are
prem
ium
)Pr
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bito
rs P
vt L
td -
- -
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000
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lotm
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of
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nst
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e Ap
plic
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n M
oney
PVR
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ited
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- -
- -
- -
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Subs
crip
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to
sh
are
capi
tal
CR R
etai
l Mal
ls (
Indi
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td 19
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900,
000
-In
ter
Corp
orat
e Lo
ans
Giv
enPV
R Pi
ctur
es L
imite
d 12
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0 14
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R Re
tail
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ls (
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td 16
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- 16
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66
Inte
r Co
rpor
ate
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s Re
paid
PVR
Pict
ures
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ited
22,
000,
000
8,0
00,0
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- -
- -
- 2
2,00
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0 8
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C R
Reta
il M
alls
(In
dia)
Pvt
Ltd
276
,571
,296
1,64
2,73
3 -
- -
- -
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96 1,
642,
733
Inte
rest
Re
ceiv
edPV
R Pi
ctur
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imite
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tail
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uara
ntee
s G
iven
(Cor
pora
te
Gua
rant
ees)
C R
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alls
(In
dia)
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000
- -
- -
- -
- 25
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0 -
Gua
rant
ees
Take
n(P
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nal
Gua
rant
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Ajay
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v Kum
ar -
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sets
M
ortg
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ar -
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ce
outs
tand
ing
at
the
end
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year
Tr
ade
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ble
PVR
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ited
556
,986
262
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- -
- -
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556
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PVR
Fact
ory
Dist
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ion
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ork
- -
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587
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xhib
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Am
ritsa
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nspo
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o. P
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td -
- -
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7 A
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- -
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239
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230
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230
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San
jeev
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ar -
- -
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9,50
0 12
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7,90
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curi
ty
Dep
osit
sPr
iya
Exhi
bito
rs P
riva
te L
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imite
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CR R
etai
l Mal
ls (
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td 10
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tere
st
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ivab
leCR
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ail M
alls
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31 1
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Inve
stm
ent
in
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ty
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lCR
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ail M
alls
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dia)
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000
7,1
00,0
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- -
- -
- 20
0,00
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0 7
,100
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PVR
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ures
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ited
15,0
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00 15
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- -
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Gua
rant
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Giv
en(C
orpo
rate
G
uara
ntee
s)C
R Re
tail
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ls (
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-G
uara
ntee
s Ta
ken
(Per
sona
l G
uara
ntee
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ay B
ijli
- -
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* *
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eev K
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- -
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* *
- -
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Asse
ts
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ay B
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eev K
umar
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4. R
ela
ted
Part
y D
isclo
sure
Contd.
Subs
idia
ry C
ompa
nies
Ente
rpris
es h
avin
g co
ntro
lKe
y Man
agem
ent P
erso
nnel
Rela
tives
of K
eyEn
terp
rises
own
ed o
r sig
nific
antly
Gran
d To
tal
or s
igni
fican
t inf
luen
ce(M
anag
ing
Dire
ctor
and
Man
agem
ent P
erso
nnel
influ
ence
d by
key
man
agem
ent
over
the
Com
pany
Join
t Man
agin
g Di
rect
or)
pers
onne
l or t
heir
rela
tives
31-M
ar-0
731
-Mar
-06
31-M
ar-0
731
-Mar
-06
31-M
ar-0
731
-Mar
-06
31-M
ar-0
731
-Mar
-06
31-M
ar-0
731
-Mar
-06
31-M
ar-0
731
-Mar
-06
66 67
Subsidiaries CR Retail Malls (India) Private LimitedPVR Pictures Limited (with effect from April 5, 2005)
Key Management Personnel Ajay Bijli, Managing Director and Sanjeev Kumar, Joint Managing Director
Relatives of Key Management Personnel Sandhuro Rani Bijli and Selena Bijli
Enterprises having control or significant Bijli Investments Private Limited, Priya Exhibitors Private Limited, Western Indiainfluence over the Company Trusteeand Executor Company Limited (India Advantage Fund-1) (till December 27,
2005)
Enterprises owned or significantly influenced The Amritsar Transport Co. Private Limited, PVR Pictures Limitedby key management personnel or (till April 4, 2005), ATC Carriers Private Limited,their relatives Leisure World Limited, PVR Factory Distribution
Network (till May 31, 2006)
NOTES:
a) * The Company has availed loans from banks and Small Industries Development Bank of India (SIDBI) of Rs. 494,989,524(Previous year Rs. 613,304,554) which are further secured by personal guarantee of two directors of the Company. Loan fromICICI Bank Limited is further secured by mortgage of the personal properties of two directors of the Company located at VasantVihar and Kundli, New Delhi. Loan from SIDBI is further secured by second charge on personal properties of a director at VasantVihar and Jhandewalan, New Delhi.
b) The above particulars exclude expenses reimbursed to/by related parties.
c) No amount has been provided as doubtful debt or advance/written off or written back in the year in respect of debts due from/toabove related parties except as disclosed above.
5. The Company has provided various share-based payment schemes to its employees. During the year ended March 31, 2007, thefollowing schemes were in operation:
Plan I Plan II Plan III
Date of grant October 10, 2005 October 10, 2005 October 10, 2005
Date of Board Approval September 8, 2005 September 8, 2005 September 8, 2005
Date of Shareholder’s approval September 15, 2005 September 15, 2005 September 15, 2005
Number of options granted 80,000 38,000 52,000
Fair value of Company’s share 75 75 77.50
Method of Settlement (Cash/Equity) Cash Cash Cash
Vesting Period 18 months 12 months 18 months
Exercise Period 3 months 3 months 3 months
Vesting Conditions Continued employment Continued employment Continued employment
The details of activity under different plans have been summarized below:
2006-07 2005-06Numberof Weighted Number of Weighted
Shares Average Exercise Shares Average ExercisePrice (Rs.) Price (Rs.)
Outstanding at the beginning of the year 170,000 28.41 Nil NilGranted during the year - - 170,000 28.41Forfeited during the year 33,500 28.21 - -Exercised during the year 136,500 28.46 - -Expired during the year - - - -Outstanding at the end of the year - - 170,000 28.41Exercisable at the end of the year - - - -Weighted average remaining contractual Nil Nil 10.72 28.41life (in months)Weighted average fair value of options granted Nil Nil 170,000 75.76
The weighted average share price at the date of exercise for stock options was Rs. 189.67.
There are no stock options outstanding at the end of the year on March 31, 2007.
Notes to the accounts
Inte
r Co
rpor
ate
Loan
s Re
paid
PVR
Pict
ures
Lim
ited
22,
000,
000
8,0
00,0
00 -
- -
- -
- 2
2,00
0,00
0 8
,000
,000
C R
Reta
il M
alls
(In
dia)
Pvt
Ltd
276
,571
,296
1,64
2,73
3 -
- -
- -
- 2
76,5
71,2
96 1,
642,
733
Inte
rest
Re
ceiv
edPV
R Pi
ctur
es L
imite
d 5
,085
,566
411
,368
- -
- -
- -
5,0
85,5
66 4
11,3
68C
R Re
tail
Mal
ls (
Indi
a) P
vt L
td 1
6,47
2,11
2 1
,519
,452
- -
- -
- -
16,
472,
112
1,5
19,4
52G
uara
ntee
s G
iven
(Cor
pora
te
Gua
rant
ees)
C R
Reta
il M
alls
(In
dia)
Pvt
Ltd
250,
000,
000
- -
- -
- -
- 25
0,00
0,00
0 -
Gua
rant
ees
Take
n(P
erso
nal
Gua
rant
ees)
Ajay
Bijl
i -
- -
- -
- -
- -
*Sa
njee
v Kum
ar -
- -
- -
- -
- -
*As
sets
M
ortg
aged
Ajay
Bijl
i -
- -
- -
- -
- -
*Sa
njee
v Kum
ar -
- -
- -
- -
- -
*B
alan
ce
outs
tand
ing
at
the
end
of
the
year
Tr
ade
Paya
ble
PVR
Pict
ures
Lim
ited
556
,986
262
,284
- -
- -
- -
556
,986
262
,284
PVR
Fact
ory
Dist
ribut
ion
Netw
ork
- -
- -
- -
- 5
87,3
75 -
587
,375
Pri
ya E
xhib
itors
Pri
vate
Lim
ited
- -
1,1
00,0
81 3
78,9
29 -
- -
- 1
,100
,081
378
,929
The
Am
ritsa
r Tra
nspo
rt C
o. P
vt L
td -
- -
- -
- -
29,
227
- 2
9,22
7 A
jay
Bijli
- -
- -
239
,900
230
,400
- -
239
,900
230
,400
San
jeev
Kum
ar -
- -
- 12
9,50
0 12
7,90
0 -
- 12
9,50
0 12
7,90
0Se
curi
ty
Dep
osit
sPr
iya
Exhi
bito
rs P
riva
te L
imite
d -
- 2
,500
,000
2,5
00,0
00 -
- -
- 2
,500
,000
2,5
00,0
00Le
isur
e Wor
ld L
imite
d -
- -
- -
- 2
,400
,000
2,4
00,0
00 2
,400
,000
2,4
00,0
00In
ter
Corp
orat
e Lo
ans
PVR
Pict
ures
Lim
ited
118,
000,
000
11,5
00,0
00 -
- -
- -
- 11
8,00
0,00
0 11
,500
,000
CR R
etai
l Mal
ls (
Indi
a) P
vt L
td 10
0,00
0,00
0 2
16,5
71,0
70 -
- -
- -
- 10
0,00
0,00
0 2
16,5
71,0
70In
tere
st
Rece
ivab
leCR
Ret
ail M
alls
(In
dia)
Pvt
Ltd
857
,031
1,1
78,4
87 -
- -
- -
- 8
57,0
31 1
,178
,487
Inve
stm
ent
in
Equi
ty
Shar
e Ca
pita
lCR
Ret
ail M
alls
(In
dia)
Pvt
Ltd
200,
000,
000
7,1
00,0
00 -
- -
- -
- 20
0,00
0,00
0 7
,100
,000
PVR
Pict
ures
Lim
ited
15,0
00,0
00 15
,000
,000
- -
- -
- -
15,0
00,0
00 15
,000
,000
Gua
rant
ees
Giv
en(C
orpo
rate
G
uara
ntee
s)C
R Re
tail
Mal
ls (
Indi
a) P
vt L
td 25
0,00
0,00
0 -
- -
- -
- -
250,
000,
000
-G
uara
ntee
s Ta
ken
(Per
sona
l G
uara
ntee
s)Aj
ay B
ijli
- -
- -
* *
- -
* *
Sanj
eev K
umar
- -
- -
* *
- -
* *
Asse
ts
Mor
tgag
edAj
ay B
ijli
- -
- -
* *
- -
* *
Sanj
eev K
umar
- -
- -
* *
- -
* *
4. R
ela
ted
Part
y D
isclo
sure
Contd
.
Subs
idia
ry C
ompa
nies
Ente
rpris
es h
avin
g co
ntro
lKe
y Man
agem
ent P
erso
nnel
Rela
tives
of K
eyEn
terp
rises
own
ed o
r sig
nific
antly
Gran
d To
tal
or s
igni
fican
t inf
luen
ce(M
anag
ing
Dire
ctor
and
Man
agem
ent P
erso
nnel
influ
ence
d by
key
man
agem
ent
over
the C
ompa
nyJo
int M
anag
ing
Dire
ctor
)pe
rson
nel o
r the
ir re
lativ
es
31-M
ar-0
731
-Mar
-06
31-M
ar-0
731
-Mar
-06
31-M
ar-0
731
-Mar
-06
31-M
ar-0
731
-Mar
-06
31-M
ar-0
731
-Mar
-06
31-M
ar-0
731
-Mar
-06
68
As at March 31, 2006
Range of Number of options Weighted average Weighted averageexercise prices outstanding remaining contractual exercise price
life of options(in months)
Rs. 20 to Rs. 47.50 170,000 10.72 28.41
Stock Options granted
The Company has not granted any stock options during the year ended March 31, 2007.
2006-07 2005-06
Exercise Price 28.46 -Expected Volatility 8.61% -Historical Volatility - -Life of the options granted (Vesting and exercise period) in months 19.12 -Expected dividends 68,250 -Average risk-free interest rate 5.50% -
Expected dividend rate 5.00%
The expected volatility was determined based on management estimates as there was no historical volatility data available.
Effect of the employee share-based payment plans on the Profit and Loss Account and Pre-Operative Expenditure and on its financialposition:
2006-07 2005-06* Total
Liability for employee stock options outstanding 2,915,965 - 2,915,965at the beginning of the yearTotal Employee Compensation Cost pertaining to share-based payment 4,502,428 2,553,183 7,055,611plans debited to Profit and Loss AccountLess: Amount reversed upon forfeiture of options (1,592,500) - (1,592,500)Net Impact in the Profit and Loss Account 2,909,928 2,553,183 5,463,111Add: Pre-Operative Expenditure (ESOP) 631,607 362,782 994,389Liability for employee stock options outstanding as at year end - 2,915,965 2,915,965Amount transferred to Securities Premium Account upon 6,457,500 - 6,457,500exercise of granted options
* Amount debited to Profit and Loss Account and Pre-Operative Expenditure during the previous year further includes amount ofRs. 4,455,000 and Rs. 345,000 respectively 80,000 equity shares issued to the certain employees under Employee Share PurchaseScheme approved in the previous year.
6. The Company has till date, incurred/made expenses/payments on a multi-screen project at Goregaon, Mumbai such as Pre-Operative Expenditure (including architect fee, traveling expenses, interest on loan taken etc.), payment of Capital Advances to asupplier and Security Deposit to developers etc. of Rs. 8,290,632, Rs. 710,000 and Rs. 26,660,340 respectively on behalf of aproposed subsidiary i.e. Sunrise Infotainment Private Limited. The Company intends to recover these expenses/payments as andwhen the final decision is taken. Pending final decision, the aforesaid amount has been shown under respective heads in theaccounts.
7 . The followings are the details of loans and advances of the Company, outstanding at the end of the year in terms of Securities &Exchange Board of India’s circular dated January 10, 2003:
Outstanding amount as at Maximum amount outstandingduring the year
March 31, 2007 March 31, 2006 March 31, 2007 March 31, 2006Rs. Rs. Rs. Rs.
Loans and Advances to Subsidiaries(including accrued interest)- CR Retail Malls (India) Private Limited 100,857,031 217,749,557 387,773,084 219,392,290- PVR Pictures Limited 118,000,000 11,500,000 118,000,000 11,500,000
Repayment of principal amount is not due as per stipulation.
8. Security Deposits (paid) include Rs. 10,332,089 recoverable from three parties, with whom the Company had entered intoMemorandum of Understanding for taking multiplex/office space on rent. The Company has filed legal case for recovery of depositof Rs. 2,832,089 in case of one party. The Company is in discussions with the parties for the recovery of the aforesaid amountand is hopeful of recovering the same. Hence, no provision against the same has been considered necessary.
Notes to the accounts
68 69
As at March 31, 2006
Range of Number of options Weighted average Weighted averageexercise prices outstanding remaining contractual exercise price
life of options(in months)
Rs. 20 to Rs. 47.50 170,000 10.72 28.41
Stock Options granted
The Company has not granted any stock options during the year ended March 31, 2007.
2006-07 2005-06
Exercise Price 28.46 -Expected Volatility 8.61% -Historical Volatility - -Life of the options granted (Vesting and exercise period) in months 19.12 -Expected dividends 68,250 -Average risk-free interest rate 5.50% -
Expected dividend rate 5.00%
The expected volatility was determined based on management estimates as there was no historical volatility data available.
Effect of the employee share-based payment plans on the Profit and Loss Account and Pre-Operative Expenditure and on its financialposition:
2006-07 2005-06* Total
Liability for employee stock options outstanding 2,915,965 - 2,915,965at the beginning of the yearTotal Employee Compensation Cost pertaining to share-based payment 4,502,428 2,553,183 7,055,611plans debited to Profit and Loss AccountLess: Amount reversed upon forfeiture of options (1,592,500) - (1,592,500)Net Impact in the Profit and Loss Account 2,909,928 2,553,183 5,463,111Add: Pre-Operative Expenditure (ESOP) 631,607 362,782 994,389Liability for employee stock options outstanding as at year end - 2,915,965 2,915,965Amount transferred to Securities Premium Account upon 6,457,500 - 6,457,500exercise of granted options
* Amount debited to Profit and Loss Account and Pre-Operative Expenditure during the previous year further includes amount ofRs. 4,455,000 and Rs. 345,000 respectively 80,000 equity shares issued to the certain employees under Employee Share PurchaseScheme approved in the previous year.
6. The Company has till date, incurred/made expenses/payments on a multi-screen project at Goregaon, Mumbai such as Pre-Operative Expenditure (including architect fee, traveling expenses, interest on loan taken etc.), payment of Capital Advances to asupplier and Security Deposit to developers etc. of Rs. 8,290,632, Rs. 710,000 and Rs. 26,660,340 respectively on behalf of aproposed subsidiary i.e. Sunrise Infotainment Private Limited. The Company intends to recover these expenses/payments as andwhen the final decision is taken. Pending final decision, the aforesaid amount has been shown under respective heads in theaccounts.
7 . The followings are the details of loans and advances of the Company, outstanding at the end of the year in terms of Securities &Exchange Board of India’s circular dated January 10, 2003:
Outstanding amount as at Maximum amount outstandingduring the year
March 31, 2007 March 31, 2006 March 31, 2007 March 31, 2006Rs. Rs. Rs. Rs.
Loans and Advances to Subsidiaries(including accrued interest)- CR Retail Malls (India) Private Limited 100,857,031 217,749,557 387,773,084 219,392,290- PVR Pictures Limited 118,000,000 11,500,000 118,000,000 11,500,000
Repayment of principal amount is not due as per stipulation.
8. Security Deposits (paid) include Rs. 10,332,089 recoverable from three parties, with whom the Company had entered intoMemorandum of Understanding for taking multiplex/office space on rent. The Company has filed legal case for recovery of depositof Rs. 2,832,089 in case of one party. The Company is in discussions with the parties for the recovery of the aforesaid amountand is hopeful of recovering the same. Hence, no provision against the same has been considered necessary.
9.1 During the previous year, the Company had successfully completed its public issue. This comprised of 5,700,000 equity shares ofRs. 10 each at a premium of Rs. 215 per share. Alongwith this public issue, there was also a sale of 2,000,000 equity shares by ashareholder of the Company i.e. Western India Trustee and Executor Company Limited (India Advantage Fund-I).
9.2 Utilization of IPO funds: Amount in Rs.
As per Prospectus Total Estimated Amount to be Amount Spent Balance to beObjects Project Cost spent till till March 31, spent
March 31, 2007 2007
Setting up of New Cinemas 1,380,000,000 1,343,000,000 481,385,767 898,614,233
Equity Investment/ UnsecuredLoan in CR Retail , a whollyowned subsidiaryfor setting up a Multiplex 300,000,000 300,000,000 300,000,000 -
Equity Investment/ UnsecuredLoan in PVR Pictures Ltd,a wholly owned subsidiaryfor Film Distribution Business 70,000,000 70,000,000 11,500,000 58,500,000
Unsecured Loan inPVR Pictures Ltd, a whollyowned subsidiary forFilm Production Business 200,000,000 - 106,500,000 93,500,000General Corporate Expenses* 62,000,000 62,000,000 71,833,661 -Issue Expenses* 120,000,000 120,000,000 110,166,339 -
Prepayment of high cost loans** Nil Nil 108,086,341 (108,086,341)
Total 2,132,000,000*** 1,895,000,000 1,189,472,108 942,527,892
NOTES:i) Unspent money is temporarily invested in the units of Mutual Funds.
ii) * The Board of Directors of the Company have approved the inter-se re-allocation of unspent monies amounting to Rs.9,833,661 from issue expenses to general corporate expenses.
iii) ** The Company had temporarily during the last year, used part of proceeds of share issue of Rs. 108,086,341 to prepay thehigh cost loans, which would be replaced by borrowing new additional loan(s) in future.
iv) *** includes Rs. 1,282,500,000 raised through public issue of equity shares.
v) Certain expenditure on setting up of new cinemas and equity investment in a subsidiary Company have been deferred to the year2007-08, due to which current year’s expenditure were lower.
10. Derivative Instruments and unhedged Foreign Currency Exposure :
Particulars of Sundry Creditors and Capital Advances not covered by foreign exchange contracts
Amount in foreign currencyParticulars Currency March 31, 2007 March 31, 2006
Sundry Creditors USD Nil 21,959GBP Nil 7,974
Capital Advances USD 29,875 587,054EURO Nil 18,897
11. Gratuity and leave benefit plans: (AS 15 Revised)The Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service gets a gratuityon departure at 15 days salary (last drawn salary) for each completed year of service. The scheme is funded with an insurancecompany in the form of a qualifying insurance policy.
The Company also provides 18-24 earned leaves to employees every year to be accumulated upto a maximum level of54-48 leaves respectively. These benefits are unfunded.The following tables summarize the components of net benefit expenserecognized in the profit and loss account and the funded status and amounts recognized in the balance sheet for the respectiveplans.
Notes to the accounts Notes to the accounts
70
Profit and Loss AccountNet employee benefit expense (recognized in Employee Cost)
Leave GratuityEncashment
2006-07 2006-07
Current service cost 1,773,360 1,439,748Interest cost on benefit obligation 223,633 420,146Expected return on plan assets - (364,795)Net actuarial loss recognized in the year - 48,676on account of return on plan assetsNet actuarial loss recognised in the year 755,805 2,228,027Net benefit expense 2,752,798 3,771,802
Actual return on plan assets - (316,119)
Balance sheetDetails of Provision for leave encashment benefits and gratuity
Leave Encashment Gratuity
2006-07 2006-07
Defined benefit obligation 4,799,565 8,917,260Total value of Provident fund contribution on closing liability 575,948 -Fair value of plan assets - 5,069,993
5,375,513 3,847,267
Less: Unrecognised past service cost - -
Plan (liability) (5,375,513) (3,847,267)
Changes in the present value of the defined benefit obligation are as follows:
Leave Encashment Gratuity
2006-07 2006-07
Opening defined benefit obligation 3,249,265 6,184,201Interest cost 223,633 420,146Current service cost 1,773,360 1,439,748Actual return on plan assets - 316,119Benefits paid (1,202,498) (1,038,743)Actuarial losses on obligation 755,805 2,228,027
Closing defined benefit obligation 4,799,565 8,917,260
Changes in the fair value of plan assets are as follows:
Gratuity
2006-07
Opening fair value of plan assets 4,891,561Expected return 364,795Contributions by employer 901,056Benefits paid (1,038,743)Actuarial (losses) (48,676)
Closing fair value of plan assets 5,069,993
The Company has since contributed Rs. 3,771,802 to the gratuity fund.
Notes to the accounts
70 71
Profit and Loss AccountNet employee benefit expense (recognized in Employee Cost)
Leave GratuityEncashment
2006-07 2006-07
Current service cost 1,773,360 1,439,748Interest cost on benefit obligation 223,633 420,146Expected return on plan assets - (364,795)Net actuarial loss recognized in the year - 48,676on account of return on plan assetsNet actuarial loss recognised in the year 755,805 2,228,027Net benefit expense 2,752,798 3,771,802
Actual return on plan assets - (316,119)
Balance sheetDetails of Provision for leave encashment benefits and gratuity
Leave Encashment Gratuity
2006-07 2006-07
Defined benefit obligation 4,799,565 8,917,260Total value of Provident fund contribution on closing liability 575,948 -Fair value of plan assets - 5,069,993
5,375,513 3,847,267
Less: Unrecognised past service cost - -
Plan (liability) (5,375,513) (3,847,267)
Changes in the present value of the defined benefit obligation are as follows:
Leave Encashment Gratuity
2006-07 2006-07
Opening defined benefit obligation 3,249,265 6,184,201Interest cost 223,633 420,146Current service cost 1,773,360 1,439,748Actual return on plan assets - 316,119Benefits paid (1,202,498) (1,038,743)Actuarial losses on obligation 755,805 2,228,027
Closing defined benefit obligation 4,799,565 8,917,260
Changes in the fair value of plan assets are as follows:
Gratuity
2006-07
Opening fair value of plan assets 4,891,561Expected return 364,795Contributions by employer 901,056Benefits paid (1,038,743)Actuarial (losses) (48,676)
Closing fair value of plan assets 5,069,993
The Company has since contributed Rs. 3,771,802 to the gratuity fund.
The major categories of plan assets as a percentage of the fair value of total plan assets are as follows:
Gratuity
2006-07
%Investments with insurer 80.14Cash and bank balance with the insurer 19.86
The overall expected rate of return on assets is determined based on the market prices prevailing on that date, applicable to theperiod over which the obligation is to be settled. There has been significant change in expected rate of return on assets due to theimproved debt market scenario.
The principal assumptions used in determining gratuity and leave encashment obligations for the Company’s plans are shownbelow:
Leave Encashment Gratuity2006-07 2006-07
% %
Discount rate 7.75 7.75Expected rate of return on plan assets - 7.50Increase in compensation cost 5.50 5.50Employee turnover upto 30 years 25 25above 30 years but upto 44 years 15 15above 44 years 10 10
The estimates of future salary increases, considered in actuarial valuation, take account of inflation, seniority, promotion and otherrelevant factors, such as supply and demand in the employment market.
Amounts for the current and previous four periods are as follows:
Leave Gratuity
2006-07 2006-07
Defined benefit obligation 4,799,565 8,917,260Plan assets - 5,069,993Deficit 4,799,565 3,847,267Experience adjustments on plan liabilities - -Experience adjustments on plan assets - -
NOTE : The actuarial valuation of gratuity and leave encashment liability in the previous year was done in accordance with thepre-revised Accounting Standard, AS-15 – Employee Benefits. Accordingly, comparative numbers of previous years have not beenfurnished.
Defined Contribution Plan:
2006-07 2005-06
Contribution to Provident Fund
Charged to Profit and Loss Account 1,1924,420 7,563,474
Charged to Pre-operative expenses 771,623 901,862
The Company expects to contribute Rs. 5,000,000 to gratuity fund in the year 2007-08.
12. Leases
i) Rental expenses in respect of operating leases are recognized as an expense in the Profit and Loss Account and Pre-OperativeExpenditure (pending allocation), as the case may be, on a straight line basis over the lease term.
Operating Lease (for assets taken on lease)
a) The Company has taken various cinemas, multiplexes, offices and godown premises under operating lease agreements. These aregenerally cancelable at the option of the Company.
b) Lease payments for the year are Rs. 188,729,426 (Previous year Rs. 154,520,675).
ii) Rental income in respect of operating leases are recognized as an income in the Profit and Loss Account and netted off from rentexpense, as the case may be, on a straight line basis over the lease term.
Operating Lease (for assets given on lease)
a) The Company has given various spaces under operating lease agreements. These are generally cancelable at the option of the Company.
b) Rental income for the year are Rs. 19,829,701 (Previous year Rs. 14,074,573).
Notes to the accounts Notes to the accounts
72
March 31, 2007 March 31, 2006(Rs.) (Rs.)
13. Capital CommitmentsEstimated amount of contracts remaining to be 92,406,246 91,204,288executed on capital account and not provided for
14. Contingent Liabilities (not provided for) in respect of:
a) Labour cases pending* Amount not Amount not ascertainable ascertainable
b) Claims against the Company not acknowledged as debts 2,961,730 1,290,311(including Rs. 2,961,730, Previous Year Rs. 854,057 paid underprotest which is appearing in the schedule of Loans and Advances)*
c) Corporate guarantee given against the loan of Rs. 500,000,000 250,000,000 -sanctioned by a financial institution to the subsidiary,to the extent of loan drawn.
* In view of the large number of cases pending at various forums/courts, it is not practicable to furnish the details of eachcase.* Based on the discussions with the solicitors/meeting the terms and conditions by the Company, the management believesthat the Company has a strong chance of success in the cases and hence no provision thereagainst is considerednecessary.
15. Supplementary Statutory Information
15.1 Managing Directors’ Remuneration*Salary 5,760,000 5,760,000Contribution to Provident fund 691,200 691,200Perquisites 3,456,000 3,456,000
Total 9,907,200 9,907,200
15.2 Executive Director’s Remuneration*Salary 3,060,000 3,060,000Contribution to Provident fund 367,200 367,200Perquisites 1,836,000 1,836,000
Total 5,263,200 5,263,200
*excluding gratuity and leave encashment expenses since they are not eligible for the same.
15.3 Earnings in foreign currency (on accrual basis)Income from Sale of Film Rights Nil 1,958,175
15.4 Expenditure in foreign currency (on accrual basis)Travelling 892,881 484,431Technical and Professional fees (including expenses, net of income tax) 5,690,411 13,520,343Others 183,665 -
Total 6,766,957 14,004,774
15.5 CIF Value of ImportsCapital Goods 14,660,135 33,504,582Software 2,832,926 527,736
Total 17,493,061 34,122,318
15.6 Net Dividend remitted in foreign currency*Number of NRI Shareholders -Number of Shares held by them -Dividend Paid (in Rs.) -Year to which dividend relates (Interim) 2005-06 and 2006-07
* excluding dividend credited to FCNR/NRE account ofNRI’s and also payments of dividend to ForeignInstitutional Investors on repatriation basis.
16. In view of the diverse nature of the food and beverages items (each being less than 10% in value of the total turnover of theCompany) being sold by the Company, it is not practicable to give the quantitative details thereof.
Notes to the accounts
72 73
March 31, 2007 March 31, 2006(Rs.) (Rs.)
13. Capital CommitmentsEstimated amount of contracts remaining to be 92,406,246 91,204,288executed on capital account and not provided for
14. Contingent Liabilities (not provided for) in respect of:
a) Labour cases pending* Amount not Amount not ascertainable ascertainable
b) Claims against the Company not acknowledged as debts 2,961,730 1,290,311(including Rs. 2,961,730, Previous Year Rs. 854,057 paid underprotest which is appearing in the schedule of Loans and Advances)*
c) Corporate guarantee given against the loan of Rs. 500,000,000 250,000,000 -sanctioned by a financial institution to the subsidiary,to the extent of loan drawn.
* In view of the large number of cases pending at various forums/courts, it is not practicable to furnish the details of eachcase.* Based on the discussions with the solicitors/meeting the terms and conditions by the Company, the management believesthat the Company has a strong chance of success in the cases and hence no provision thereagainst is considerednecessary.
15. Supplementary Statutory Information
15.1 Managing Directors’ Remuneration*Salary 5,760,000 5,760,000Contribution to Provident fund 691,200 691,200Perquisites 3,456,000 3,456,000
Total 9,907,200 9,907,200
15.2 Executive Director’s Remuneration*Salary 3,060,000 3,060,000Contribution to Provident fund 367,200 367,200Perquisites 1,836,000 1,836,000
Total 5,263,200 5,263,200
*excluding gratuity and leave encashment expenses since they are not eligible for the same.
15.3 Earnings in foreign currency (on accrual basis)Income from Sale of Film Rights Nil 1,958,175
15.4 Expenditure in foreign currency (on accrual basis)Travelling 892,881 484,431Technical and Professional fees (including expenses, net of income tax) 5,690,411 13,520,343Others 183,665 -
Total 6,766,957 14,004,774
15.5 CIF Value of ImportsCapital Goods 14,660,135 33,504,582Software 2,832,926 527,736
Total 17,493,061 34,122,318
15.6 Net Dividend remitted in foreign currency*Number of NRI Shareholders -Number of Shares held by them -Dividend Paid (in Rs.) -Year to which dividend relates (Interim) 2005-06 and 2006-07
* excluding dividend credited to FCNR/NRE account ofNRI’s and also payments of dividend to ForeignInstitutional Investors on repatriation basis.
16. In view of the diverse nature of the food and beverages items (each being less than 10% in value of the total turnover of theCompany) being sold by the Company, it is not practicable to give the quantitative details thereof.
As per our report of even date
For S. R. Batliboi & Co. FOR AND ON BEHALF OF THE BOARD OF DIRECTORSChartered Accountants
Ajay Bijli Sanjeev Kumar N. C. GuptaChairman cum Managing Director Joint Managing Director Company Secretary
per Anil Gupta Sumit Chandwani Renaud Jean Palliere Neeraj PrakashPartner Director Director Chief of AccountsMembership No 87921
Place : New DelhiDate : June 6, 2007
Notes to the accounts Notes to the accounts
17. Previous Year Comparatives
(a) The Company has during the year started commercial operations at Juhu Mumbai, Indore, Lucknow, Mullund Mumbai,Sahara Gurgaon, Aurangabad, Latur and Aligarh. Hence, current year’s figures are not strictly comparable with those ofprevious year.
b) Previous year’s figures have been regrouped where necessary to conform to current year’s classification.
Signature to Schedule 1 to 24
74
ConsolidatedFinancial
statements
74 75
Auditors’ Report to the Board Of Directors of
PVR Limited on the consolidated financial statements
of PVR Limited and its subsidiaries (CR Retail Malls
(India) Private Limited and PVR Pictures Limited)
We have audited the attached Consolidated Balance
Sheet of PVR Limited and its Subsidiaries (hereinafter
referred as the “PVR Group”) as at March 31, 2007,
the Consolidated Profit and Loss Account and the
Consolidated Cash Flow Statement for the year ended on
that date annexed thereto. These financial statements are
the responsibility of the PVR Limited’s management. Our
responsibility is to express an opinion on the consolidated
financial statements based on our audit.
We conducted our audit in accordance with the auditing
standards generally accepted in India. Those Standards
require that we plan and perform the audit to obtain
reasonable assurance about whether the financial
statements are free of material misstatement. An audit
includes examining on a test basis, evidence supporting the
amounts and disclosures in the financial statements.
An audit also includes assessing the accounting principles
used and significant estimates made by management,
as well as evaluating the overall financial statement
presentation. We believe that our audit provides a
reasonable basis for our opinion.
We did not audit the financial statements of the
subsidiaries of PVR Limited whose financial statements
reflect total assets of Rs. 760,761,010 as at March 31,
2007 (Rs. 267,129,805 as at March 31, 2006), total
revenues of Rs. 35,525,699 for the year ended March 31,
2007 (Rs. 23,027,777 for the year ended March 31,
2006) and cash flows amounting to Rs. 43,647,646 for
the year ended March 31, 2007 (Rs. 257,241 for the year
ended March 31, 2006). The financial statement and other
financial information of the above subsidiaries have been
audited by other auditors whose reports have been
furnished to us, and our opinion, in so far as it relates to the
amounts included in respect of the subsidiaries is based
solely on the report of those auditors.
We report that the consolidated financial statements
have been prepared by PVR Limited’s management in
accordance with the requirements of Accounting Standard
(AS) 21, Consolidated Financial Statements issued by the
Institute of Chartered Accountants of India and on the
basis of the separate audited financial statements of
PVR Limited and its subsidiaries included in the consolidated
financial statements.
In our opinion, and on the basis of the information and
explanations given to us and based on the consolidation of
separate audit reports on individual financial statement of
PVR Limited and its subsidiaries, the consolidated financial
statements of PVR Limited and its subsidiaries give a true
and fair view in conformity with the accounting principles
generally accepted in India:
(i) in the case of the Consolidated Balance Sheet,
of the consolidated state of affairs of PVR Group as at
March 31, 2007;
(ii) in the case of the Consolidated Profit and Loss
Account, of the Profit of the PVR Group for the year
ended on that date; and
(iii) in the case of the Consolidated Cash Flow Statement,
of the Cash Flows of the PVR Group for the year ended
on that date.
For S. R. Batliboi & Co.
Chartered Accountants
per Anil Gupta
Partner
Membership No.:87921
Place : New Delhi
Date : June 6, 2007
Auditors’ Report
ConsolidatedFinancial
statements
76
Consolidated Balance Sheet as at 31 March, 2007
Schedules As at As atMarch 31, 2007 March 31, 2006
(Rs.) (Rs.)
SOURCES OF FUNDS
Shareholders’ Funds
Share Capital 1 430,138,700 428,773,700
Employees Stock Options Outstanding 2 - 2,915,966
Reserves and surplus 3 1,569,937,423 1,495,069,904
2,000,076,123 1,926,759,570
Loan funds
Secured loans 4 850,664,739 613,655,281
Unsecured loans 5 30,000 2,405,443
850,694,739 616,060,724
Deferred Tax Liabilities (Net) 6 64,682,669 45,831,506
2,915,453,531 2,588,651,800
APPLICATION OF FUNDS
Fixed Assets 7
Gross block 1,701,728,652 1,011,597,845
Less : Accumulated Depreciation 349,657,282 227,948,447
Net block 1,352,071,370 783,649,398
Capital Work-in-Progress including Capital Advances 659,920,725 642,272,967
Pre-operative expenses (pending allocation) 8 72,965,631 158,592,525
2,084,957,726 1,584,514,890
Intangible Assets (net of amortisation and including 9 29,628,684 15,663,642
capital work-in-progress and capital advances)
Investments 10 421,016,644 294,169,691
Current Assets, Loans and Advances
Interest accrued on long term investments 2,987,165 1,847,568
Inventories 11 17,615,286 9,246,574
Sundry debtors 12 68,869,662 42,509,429
Cash and bank balances 13 115,370,862 630,166,780
Other current assets 14 4,946,904 10,409,203
Loans and advances 15 567,250,916 310,403,908
777,040,795 1,004,583,462
Less: Current Liabilities and Provisions
Current liabilities 16 328,051,790 238,669,167
Provisions 17 69,138,528 71,610,718
397,190,318 310,279,885
Net Current Assets 379,850,477 694,303,577
Miscellaneous Expenditure 18 - -
2,915,453,531 2,588,651,800
Notes to Accounts 25
The schedules referred to above and notes to accounts form an integral part of the Consolidated Balance Sheet.
As per our report of even date
For S. R. Batliboi & Co. FOR AND ON BEHALF OF THE BOARD OF DIRECTORSChartered Accountants
Ajay Bijli Sanjeev Kumar N. C. GuptaChairman cum Managing Director Joint Managing Director Company Secretary
per Anil Gupta Sumit Chandwani Renaud Jean Palliere Neeraj PrakashPartner Director Director Chief of Accounts
Membership No 87921
Place : New DelhiDate : June 6, 2007
76 77
Schedules For the year ended For the year endedMarch 31, 2007 March 31, 2006
(Rs.) (Rs.)
INCOMEOperating income 19 2,012,305,870 1,304,669,038Less: Entertainment tax collected on sale of tickets 291,582,187 224,379,377Less: Sales tax/Value Added tax collected on sale of 40,692,112 26,779,327food and beveragesLess: Service tax collected on advertisement and 12,867,061 4,443,431
management fees 1,667,164,510 1,049,066,903
Other income 20 61,295,246 28,973,633
1,728,459,756 1,078,040,536
EXPENDITUREFilm distributors’ share (net of recovery towards 437,604,901 268,056,021publicity from distributors Rs. 4,376,315,Previous year Rs. 3,034,500)Consumption of food and beverages 114,552,600 71,241,239Personnel expenses 21 196,212,582 125,530,030Employee compensation expenses under employee 2,909,928 7,008,183share purchase scheme and employee stock option schemeOperating and other expenses 22 649,503,798 404,496,207
1,400,783,809 876,331,680
Profit before depreciation/amortisation, 327,675,947 201,708,856interest and tax (EBITDA)Depreciation/amortisation 133,379,013 83,349,792
Interest paid 23 43,861,440 30,737,157
Profit Before Tax 150,435,494 87,621,907
Provision for taxes (Including wealth tax Rs. 50,000, (27,048,000) (27,365,000)Previous year Rs. 30,000)Fringe benefit tax (5,157,721) (3,883,194)Deferred tax charge (18,988,268) (3,508,820)Income tax credit for earlier years (net) 2,653,439 -
Total Tax Expense (48,540,550) (34,757,014)
Net Profit after tax 101,894,944 52,864,893Balance brought forward from previous year 132,251,446 88,827,953Pre-Acquisition losses adjusted against Goodwill 1,668,361 -Less: Adjustment for Employee Benefits Provision (Net of (270,219) -Tax Rs. 137,106) (Refer Note No. 4 (b) in Schedule 25)Transfer from Debenture Redemption Reserve - 22,600,000
Profit available for appropriation 235,544,532 164,292,846Appropriations- Interim dividend on equity shares 22,915,370 22,877,370- Interim dividend on preference shares 10,000,000 5,219,178- Tax on dividend 4,616,381 3,944,852
Surplus carried to Balance Sheet 198,012,781 132,251,446
Earnings per share 24Basic [Nominal value of shares Rs. 10 (Previous Year : Rs. 10)] 3.95 2.62Diluted [Nominal value of shares Rs. 10 (Previous Year : Rs. 10)] 3.95 2.62
Notes to Accounts 25
The schedules referred to above and notes to accounts form an integral part of the Consolidated Profit and Loss Account.
Consolidated Balance Sheet as at 31 March, 2007 Consolidated Profit and Loss Accountfor the year ended March 31, 2007
As per our report of even date
For S. R. Batliboi & Co. FOR AND ON BEHALF OF THE BOARD OF DIRECTORSChartered Accountants
Ajay Bijli Sanjeev Kumar N. C. GuptaChairman cum Managing Director Joint Managing Director Company Secretary
per Anil Gupta Sumit Chandwani Renaud Jean Palliere Neeraj PrakashPartner Director Director Chief of Accounts
Membership No 87921
Place : New DelhiDate : June 6, 2007
Schedules As at As atMarch 31, 2007 March 31, 2006
(Rs.) (Rs.)
SOURCES OF FUNDS
Shareholders’ Funds
Share Capital 1 430,138,700 428,773,700
Employees Stock Options Outstanding 2 - 2,915,966
Reserves and surplus 3 1,569,937,423 1,495,069,904
2,000,076,123 1,926,759,570
Loan funds
Secured loans 4 850,664,739 613,655,281
Unsecured loans 5 30,000 2,405,443
850,694,739 616,060,724
Deferred Tax Liabilities (Net) 6 64,682,669 45,831,506
2,915,453,531 2,588,651,800
APPLICATION OF FUNDS
Fixed Assets 7
Gross block 1,701,728,652 1,011,597,845
Less : Accumulated Depreciation 349,657,282 227,948,447
Net block 1,352,071,370 783,649,398
Capital Work-in-Progress including Capital Advances 659,920,725 642,272,967
Pre-operative expenses (pending allocation) 8 72,965,631 158,592,525
2,084,957,726 1,584,514,890
Intangible Assets (net of amortisation and including 9 29,628,684 15,663,642
capital work-in-progress and capital advances)
Investments 10 421,016,644 294,169,691
Current Assets, Loans and Advances
Interest accrued on long term investments 2,987,165 1,847,568
Inventories 11 17,615,286 9,246,574
Sundry debtors 12 68,869,662 42,509,429
Cash and bank balances 13 115,370,862 630,166,780
Other current assets 14 4,946,904 10,409,203
Loans and advances 15 567,250,916 310,403,908
777,040,795 1,004,583,462
Less: Current Liabilities and Provisions
Current liabilities 16 328,051,790 238,669,167
Provisions 17 69,138,528 71,610,718
397,190,318 310,279,885
Net Current Assets 379,850,477 694,303,577
Miscellaneous Expenditure 18 - -
2,915,453,531 2,588,651,800
Notes to Accounts 25
The schedules referred to above and notes to accounts form an integral part of the Consolidated Balance Sheet.
As per our report of even date
For S. R. Batliboi & Co. FOR AND ON BEHALF OF THE BOARD OF DIRECTORSChartered Accountants
Ajay Bijli Sanjeev Kumar N. C. GuptaChairman cum Managing Director Joint Managing Director Company Secretary
per Anil Gupta Sumit Chandwani Renaud Jean Palliere Neeraj PrakashPartner Director Director Chief of Accounts
Membership No 87921
Place : New DelhiDate : June 6, 2007
78
For the year ended For the year endedMarch 31, 2007 March 31, 2006
(Rs.) (Rs.)
A. Cash flow from operating activities:
Profit before taxation 150,435,494 87,621,907
Adjustments for :
Depreciation/amortisation 133,379,013 83,349,792
Loss on disposal of fixed assets (net) 1,303,110 2,515,492
Interest income (15,099,773) (12,329,035)
Profit on sale of current investments (242,763) -
Dividend income (26,214,457) (3,391,096)
Loss on sale of current investments - 35,506
Interest expense 43,861,440 30,737,157
Employee compensation expenses under employee share purchase 2,909,928 7,008,183
scheme and employee stock option scheme
Provision for doubtful debts and advances (net) 2,278,143 1,602,381
Operating profit before working capital changes 292,610,135 197,150,287
Movements in working capital :
(Increase) in sundry debtors (28,638,377) (10,241,597)
(Increase) in inventories (8,368,712) (2,469,958)
(Increase) in loans and advances and other current assets (120,661,321) (105,901,431)
Increase in current liabilities and provisions 96,077,503 87,684,217
Cash generated from operations 231,019,228 166,221,518
Direct taxes paid (net of refunds) (39,797,666) (21,910,604)
Net cash from operating activities 191,221,562 144,310,914
B. Cash flows from investing activities
Purchase of fixed assets (608,190,120) (782,524,369)
Purchase of intangible assets (23,919,888) (18,436,730)
Proceeds from sale of fixed assets 10,567 1,091,000
Purchase of investments/advance against share capital (2,852,783,458) (722,169,691)
Sale of investments 2,726,179,268 439,964,494
Consideration paid for acquiring interest in subsidiary - (500,000)
Loans given to others (101,000,000) -
Loans refunded by others - 1,500,000
Dividend received 26,214,457 3,391,096
Interest received 18,768,864 5,785,043
Fixed Deposits with banks placed (10,947,727) (623,350,033)
Fixed Deposits with banks encashed 613,371,938 22,040,980
Net cash (used in) investing activities (212,296,099) (1,673,208,210)
C. Cash flow from financing activities
Proceeds from issuance of share capital 3,885,000 1,484,100,000
Proceeds from long-term borrowings 355,800,000 360,361,101
Repayment of long-term borrowings (118,790,542) (201,779,288)
Proceeds from short-term borrowings - 240,000,000
Repayment of short-term borrowings (2,375,443) (250,569,124)
Expenditure on share issue - (113,037,501)
Dividend and tax thereon paid (69,573,151) -
Interest paid (58,287,950) (59,575,479)
Net cash from financing activities 110,657,914 1,459,499,709
Net increase/(decrease) in cash and cash 89,583,377 (69,397,587)
equivalents (A+B+C)
Balance at the time of acquisition of subsidiary - 1,286,028
Cash and cash equivalents at the beginning of the year 13,332,907 81,444,466
Cash and cash equivalents at the end of the year 102,916,284 13,332,907
Consolidated Cash Flow Statement for the year ended March 31, 2007
78 79
For the year ended For the year endedMarch 31, 2007 March 31, 2006
(Rs.) (Rs.)
A. Cash flow from operating activities:
Profit before taxation 150,435,494 87,621,907
Adjustments for :
Depreciation/amortisation 133,379,013 83,349,792
Loss on disposal of fixed assets (net) 1,303,110 2,515,492
Interest income (15,099,773) (12,329,035)
Profit on sale of current investments (242,763) -
Dividend income (26,214,457) (3,391,096)
Loss on sale of current investments - 35,506
Interest expense 43,861,440 30,737,157
Employee compensation expenses under employee share purchase 2,909,928 7,008,183
scheme and employee stock option scheme
Provision for doubtful debts and advances (net) 2,278,143 1,602,381
Operating profit before working capital changes 292,610,135 197,150,287
Movements in working capital :
(Increase) in sundry debtors (28,638,377) (10,241,597)
(Increase) in inventories (8,368,712) (2,469,958)
(Increase) in loans and advances and other current assets (120,661,321) (105,901,431)
Increase in current liabilities and provisions 96,077,503 87,684,217
Cash generated from operations 231,019,228 166,221,518
Direct taxes paid (net of refunds) (39,797,666) (21,910,604)
Net cash from operating activities 191,221,562 144,310,914
B. Cash flows from investing activities
Purchase of fixed assets (608,190,120) (782,524,369)
Purchase of intangible assets (23,919,888) (18,436,730)
Proceeds from sale of fixed assets 10,567 1,091,000
Purchase of investments/advance against share capital (2,852,783,458) (722,169,691)
Sale of investments 2,726,179,268 439,964,494
Consideration paid for acquiring interest in subsidiary - (500,000)
Loans given to others (101,000,000) -
Loans refunded by others - 1,500,000
Dividend received 26,214,457 3,391,096
Interest received 18,768,864 5,785,043
Fixed Deposits with banks placed (10,947,727) (623,350,033)
Fixed Deposits with banks encashed 613,371,938 22,040,980
Net cash (used in) investing activities (212,296,099) (1,673,208,210)
C. Cash flow from financing activities
Proceeds from issuance of share capital 3,885,000 1,484,100,000
Proceeds from long-term borrowings 355,800,000 360,361,101
Repayment of long-term borrowings (118,790,542) (201,779,288)
Proceeds from short-term borrowings - 240,000,000
Repayment of short-term borrowings (2,375,443) (250,569,124)
Expenditure on share issue - (113,037,501)
Dividend and tax thereon paid (69,573,151) -
Interest paid (58,287,950) (59,575,479)
Net cash from financing activities 110,657,914 1,459,499,709
Net increase/(decrease) in cash and cash 89,583,377 (69,397,587)
equivalents (A+B+C)
Balance at the time of acquisition of subsidiary - 1,286,028
Cash and cash equivalents at the beginning of the year 13,332,907 81,444,466
Cash and cash equivalents at the end of the year 102,916,284 13,332,907
Consolidated Cash Flow Statement for the year ended March 31, 2007
For the year ended For the year endedMarch 31, 2007 March 31, 2006
(Rs.) (Rs.)
Cash Flow Statement for the year ended March 31, 2007 (continued)
As per our report of even date
For S. R. Batliboi & Co. FOR AND ON BEHALF OF THE BOARD OF DIRECTORSChartered Accountants
Ajay Bijli Sanjeev Kumar N. C. GuptaChairman cum Managing Director Joint Managing Director Company Secretary
per Anil Gupta Sumit Chandwani Renaud Jean Palliere Neeraj PrakashPartner Director Director Chief of Accounts
Membership No 87921
Place : New DelhiDate : June 6, 2007
Components of cash and cash equivalents as at* March 31, 2007 March 31, 2006
Cash and cheques on hand 8,628,024 4,274,236
With banks - on current accounts 93,817,264 11,013,755
With banks - on book overdraft account - (1,955,084)
With banks - on unpaid and unclaimed dividend accounts 470,996 -
102,916,284 13,332,907
*difference of Rs. 12,454,578 (Previous year Rs. 616,833,873) from Schedule No. 13 represents short-term investments with an
original maturity of three months or more.
NOTE: The above Cash Flow Statement has been prepared under the “Indirect Method” as stated in Accounting Standard 3 on Cash
Flow Statement.
80
Schedule 1 : Share CapitalAs at As at
March 31, 2007 March 31, 2006(Rs.) (Rs.)
Authorised share capital30,000,000 (Previous year 30,000,000) equity shares of Rs. 10 each 300,000,000 300,000,00020,000,000 (Previous year 20,000,000) preference shares of Rs. 10 each 200,000,000 200,000,000
500,000,000 500,000,000
Issued, subscribed and paid-up23,013,870 (Previous year 22,877,370) equity shares of Rs. 10 each fully paid 230,138,700 228,773,70020,000,000 (Previous year 20,000,000) 5% redeemable preference 200,000,000 200,000,000shares of Rs. 10 each fully paid
430,138,700 428,773,700
NOTES:1. Of the above 10,642,000 (Previous year 10,642,000) 5% redeemable preference shares are held by Mr. Ajay Bijli, Chairman cum
Managing Director of the Parent Company.2. Preference shares are redeemable at par after three years with a put and call option at the end of two years from the date of allotment.3. Of the above Nil (Previous year 80,000) equity shares of the face value of Rs. 10 each issued to the eligible employees of the Parent
Company under Employees Share Purchase Scheme.4. Of the above 136,500 (Previous year Nil) equity shares of the face value of Rs. 10 each issued to the eligible employees of the Parent
Company under Employees Stock Option Scheme (Refer Note No. 7of Schedule 25).
Schedule 2 : Employees Stock Options Outstanding
Employees stock options outstandingAs per last account 2,915,966 -Add: Accounted for during the year (net) (Refer Note No. 7 of Schedule 25) 3,541,534 2,915,966
6,457,500 2,915,966Less: Amount transferred to Securities Premium Account upon issue of equity shares 6,457,500 -
- 29,15,966
Schedule 3 : Reserves and Surplus
Capital Reserve (on consolidation) difference between the cost of the investment 24,483 24,483in a subsidiary and Parent Company’s portion in equity of the subsidiary at the timeof acquisition (Refer Note No. 3 of Schedule 25)
Securities premium account - as per last account 1,362,793,975 250,306,573Add:Received on issue of shares under employees share 2,520,000 5,600,000purchase/employees stock option schemeReceived on issue of shares to public during the year - 1,225,500,000Amount transferred from Employees Stock Options Outstanding Account 6,457,500 -
Excess provision for share issue expenses now written back and 128,684 -adjusted from securities premium account
1,371,900,159 1,481,406,573Less: Share/debenture placement expenses written off - 118,612,598
1,371,900,159 1,362,793,975
Debenture redemption reserve - as per last account - 22,600,000Less: Transferred to Profit and Loss Account on redemption of debentures - 22,600,000
- -
Profit and Loss Account Balance 198,012,781 132,251,446
1,569,937,423 1,495,069,904
Schedules to the Consolidated accounts
80 81
Schedule 1 : Share CapitalAs at As at
March 31, 2007 March 31, 2006(Rs.) (Rs.)
Authorised share capital30,000,000 (Previous year 30,000,000) equity shares of Rs. 10 each 300,000,000 300,000,00020,000,000 (Previous year 20,000,000) preference shares of Rs. 10 each 200,000,000 200,000,000
500,000,000 500,000,000
Issued, subscribed and paid-up23,013,870 (Previous year 22,877,370) equity shares of Rs. 10 each fully paid 230,138,700 228,773,70020,000,000 (Previous year 20,000,000) 5% redeemable preference 200,000,000 200,000,000shares of Rs. 10 each fully paid
430,138,700 428,773,700
NOTES:1. Of the above 10,642,000 (Previous year 10,642,000) 5% redeemable preference shares are held by Mr. Ajay Bijli, Chairman cum
Managing Director of the Parent Company.2. Preference shares are redeemable at par after three years with a put and call option at the end of two years from the date of allotment.3. Of the above Nil (Previous year 80,000) equity shares of the face value of Rs. 10 each issued to the eligible employees of the Parent
Company under Employees Share Purchase Scheme.4. Of the above 136,500 (Previous year Nil) equity shares of the face value of Rs. 10 each issued to the eligible employees of the Parent
Company under Employees Stock Option Scheme (Refer Note No. 7of Schedule 25).
Schedule 2 : Employees Stock Options Outstanding
Employees stock options outstandingAs per last account 2,915,966 -Add: Accounted for during the year (net) (Refer Note No. 7 of Schedule 25) 3,541,534 2,915,966
6,457,500 2,915,966Less: Amount transferred to Securities Premium Account upon issue of equity shares 6,457,500 -
- 29,15,966
Schedule 3 : Reserves and Surplus
Capital Reserve (on consolidation) difference between the cost of the investment 24,483 24,483in a subsidiary and Parent Company’s portion in equity of the subsidiary at the timeof acquisition (Refer Note No. 3 of Schedule 25)
Securities premium account - as per last account 1,362,793,975 250,306,573Add:Received on issue of shares under employees share 2,520,000 5,600,000purchase/employees stock option schemeReceived on issue of shares to public during the year - 1,225,500,000Amount transferred from Employees Stock Options Outstanding Account 6,457,500 -
Excess provision for share issue expenses now written back and 128,684 -adjusted from securities premium account
1,371,900,159 1,481,406,573Less: Share/debenture placement expenses written off - 118,612,598
1,371,900,159 1,362,793,975
Debenture redemption reserve - as per last account - 22,600,000Less: Transferred to Profit and Loss Account on redemption of debentures - 22,600,000
- -
Profit and Loss Account Balance 198,012,781 132,251,446
1,569,937,423 1,495,069,904
Schedule 4 : SecureD Loans
As at As atMarch 31, 2007 March 31, 2006
(Rs.) (Rs.)
Loans from banksTerm loans from banks 520,639,524 522,754,554(Due within one year Rs. 139,008,752, (Previous year Rs. 102,096,655))
Car finance loans from banks 5,675,215 350,727(Due within one year Rs. 1,125,553, (Previous year Rs. 162,538))
Other loansTerm loan from a financial institution 250,000,000 -(Due within one year Rs. 1,151,316, (Previous year Rs. Nil))
Term loan from small industries development bank of india (SIDBI) 74,350,000 90,550,000(Due within one year Rs. 16,200,000, (Previous year Rs. 16,200,000))
850,664,739 613,655,281
NOTES :
1. a) Term loans from State Bank of Patiala, United Bank of India and Union bank of India to the extent of Rs. 233,139,524(Previous year Rs. 322,754,554), are secured by first charge by way of hypothecation of the whole of the movable propertiesincluding movable plant and machinery, machinery spares, tools and accessories and other movable assets (except vehicleshypothecated to banks) of all current and future operating theatres of the Parent Company ranking pari passu with otherlenders. These are further secured by the personal guarantee of two directors of the Parent Company.
b) Term Loan from ICICI Bank Limited to the extent of Rs. 187,500,000 (Previous year Rs. 200,000,000) is secured by firstcharge on all of the Parent Company’s movable assets, save and except the assets at the Juhu multiplex, both present andfuture, on pari passu basis with other term lenders. This loan is further secured by mortgage of the personal properties of twodirectors of Parent Company at Vasant Vihar and Kundli, New Delhi and is to be further secured by pledge of the ParentCompany’s PVR Brand/patent/trademark. This loan is further secured by the personal guarantee of two directors of the ParentCompany.
c) Term Loan from Punjab National Bank to the extent of Rs. 100,000,000, (Previous year Rs. Nil) is secured by first pari passucharge with other lenders on all assets and movable property (excluding vehicles hypothecated to banks), including current assetsnamely current and movable fixed assets of any kind belonging to the Parent Company both present and future except those atPVR Juhu, Mumbai of the Parent Company. This loan is further secured by second charge on all the movable and immovableassets namely current and movable fixed assets as well as the movable and immovable assets at PVR Juhu, Mumbai of theParent Company and PVR Phoenix, Mumbai of a subsidiary.
2. Car finance loans to the extent of Rs. 5,675,215 (Previous year Rs. 350,727) are to be secured by hypothecation of vehiclespurchased out of the proceeds of the loans.
3. Loan from a financial institution to the extent of Rs. 250,000,000 (Previous year Rs. Nil) is secured by first equitable mortgage, byway of a registered mortgage deed, alongwith assignment of its leasehold rights, of the project land at Phoenix Mills, Lower Parel,Mumbai and construction thereon of a subsidiary company, present and future. This loan is further secured by hypothecation of allmovable assets and assignment of all present and future receivables of the seven screen multiplex at Phoenix Mills, Lower Parel,Mumbai of a subsidiary company. It is further secured by corporate guarantee from Parent Company and undertaking from ParentCompany to the effect that they will continue to hold a minimum of 76% of the shareholding of the subsidiary during the currency ofthe loan.
4. Loan from SIDBI to the extent of Rs. 74,350,000 (Previous year Rs. 90,550,000) is secured by a first pari passu charge by way ofhypothecation of all the movable assets (except vehicles hypothecated to banks) both present and future, of all cinemas of the ParentCompany. It is further secured by a second charge on personal properties of a director of Parent Company at Vasant Vihar andJhandewalan, New Delhi and is also secured by the personal guarantee of two directors of the Parent Company.
Schedules to the Consolidated accountsSchedules to the Consolidated accounts
Schedule 5 : Unsecured Loans
As at As atMarch 31, 2007 March 31, 2006
(Rs.) (Rs.)
Other loans:Short Term Loans (Repayable within one year)From a body corporate 30,000 1,040,443From a Director of a subsidiary company (Interest free) - 1,365,000
30,000 2,405,443
82
As at As atMarch 31, 2007 March 31, 2006
(Rs.) (Rs.)
Deferred Tax LiabilitiesDifferences in depreciation and other differences in block of fixed assets 68,800,324 49,015,971as per tax books and financial books
Gross Deferred Tax Liabilities 68,800,324 49,015,971
Deferred Tax AssetsEffect of expenditure debited to profit and loss account in the current year/ 2,713,419 1,605,906earlier years but allowable for tax purposes in following yearsCarried Forward business loss and unabsorbed depreciation in one of - 954,779the subsidiary companyProvision for doubtful debts and advances 1,404,236 623,780
Gross Deferred Tax Assets 4,117,655 3,184,465
Net Deferred Tax Liabilities 64,682,669 45,831,506
NOTE : Deferred Tax Liabilities include Rs. Nil (Previous year Rs. 37,362) acquired at the time of acquisition of a subsidiary company.
Schedules to the Consolidated accounts
Schedule 6 : Deferred Tax Liabilities (Net)
82 83
As at As atMarch 31, 2007 March 31, 2006
(Rs.) (Rs.)
Deferred Tax LiabilitiesDifferences in depreciation and other differences in block of fixed assets 68,800,324 49,015,971as per tax books and financial books
Gross Deferred Tax Liabilities 68,800,324 49,015,971
Deferred Tax AssetsEffect of expenditure debited to profit and loss account in the current year/ 2,713,419 1,605,906earlier years but allowable for tax purposes in following yearsCarried Forward business loss and unabsorbed depreciation in one of - 954,779the subsidiary companyProvision for doubtful debts and advances 1,404,236 623,780
Gross Deferred Tax Assets 4,117,655 3,184,465
Net Deferred Tax Liabilities 64,682,669 45,831,506
NOTE : Deferred Tax Liabilities include Rs. Nil (Previous year Rs. 37,362) acquired at the time of acquisition of a subsidiary company.
Schedules to the Consolidated accounts
Sch
edule
7 :
Consolida
ted Fixed Assets
Rs
.
Go
od
will
Lan
d F
reeh
old
Build
ing
Leas
eh
old
Pla
nt
&Furn
iture
&V
ehic
les
Tota
lP
revi
ous
Year
(on C
onso
lidat
ion)
Impro
vem
ents
Mac
hin
ery
Fit
tings
Gro
ss B
lock
At
01
.04
.20
06
1,5
68
,93
81
90
,35
01
,27
3,5
90
28
6,9
60
,02
95
63
,03
4,5
83
15
2,5
53
,12
16
,01
7,2
34
1,0
11
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7,8
45
83
0,5
48
,66
1
Additi
ons
1,6
68
,36
1-
-2
65
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8,0
70
31
4,0
39
,61
01
05
,21
3,1
61
6,9
80
,61
46
93
,15
9,8
16
18
7,0
16
,77
7
Deduct
ions
--
-1
5,6
00
95
0,6
80
2,0
62
,72
9-
3,0
29
,00
95
,96
7,5
93
At
31
.03
.20
07
3,2
37
,29
91
90
,35
01
,27
3,5
90
55
2,2
02
,49
98
76
,12
3,5
13
25
5,7
03
,55
31
2,9
97
,84
81
,70
1,7
28
,65
21
,01
1,5
97
,84
5
D
ep
recia
tio
n
At
01
.04
.20
06
47
0,6
82
-1
69
,53
96
5,6
68
,26
01
21
,47
7,8
04
38
,72
7,5
24
1,4
34
,63
82
27
,94
8,4
47
15
9,6
09
,35
6
Fo
r th
e y
ear
31
5,6
16
-2
0,7
60
40
,45
2,2
80
56
,03
9,1
22
25
,57
3,9
45
1,0
22
,44
41
23
,42
4,1
67
70
,64
4,9
05
Deduct
ions
--
-1
1,0
13
41
9,0
24
1,2
85
,29
5-
1,7
15
,33
22
,30
5,8
14
At
31
.03
.20
07
78
6,2
98
-1
90
,29
91
06
,10
9,5
27
17
7,0
97
,90
26
3,0
16
,17
42
,45
7,0
82
34
9,6
57
,28
22
27
,94
8,4
47
For
pre
vio
us
year
31
3,7
88
20
,76
01
7,9
79
,69
73
8,3
33
,01
31
3,3
67
,13
36
30
,51
47
0,6
44
,90
5-
Ne
t B
lock
At
31
.03
.20
07
2,4
51
,00
11
90
,35
01
,08
3,2
91
44
6,0
92
,97
26
99
,02
5,6
11
19
2,6
87
,37
91
0,5
40
,76
61
,35
2,0
71
,37
07
83
,64
9,3
98
At
31
.03
.20
06
1,0
98
,25
61
90
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01
,10
4,0
51
22
1,2
91
,76
94
41
,55
6,7
79
11
3,8
25
,59
74
,58
2,5
96
78
3,6
49
,39
8-
Cap
ital w
ork
in p
rogr
ess
62
2,2
76
,74
53
75
,23
4,2
40
Cap
ital A
dva
nce
s (U
nse
cure
d, c
onsi
dere
d g
oo
d)
37
,64
3,9
80
26
7,0
38
,72
7
65
9,9
20
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56
42
,27
2,9
67
To
tal
2,4
51
,00
11
90
,35
01
,08
3,2
91
44
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92
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26
99
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5,6
11
19
2,6
87
,37
91
0,5
40
,76
62
,01
1,9
92
,09
5-
NO
TE
S:
1.
Fixe
d a
ssets
of
the c
ost
of
Rs.
2,8
43
,66
8,
Pre
vio
us
year
Rs.
2,7
59
,48
0,
(WD
V R
s.1
,20
9,9
41
, Pre
vio
us
year
Rs.
1,5
91
,30
0)
hav
e b
een
dis
card
ed
du
rin
g th
e y
ear
.
2.
Gro
ss B
lock
of
Fixe
d A
ssets
incl
ud
e R
s. 4
3,9
51
,08
9 (
Pre
vio
us
year
Rs.
28
,15
2,0
00
) b
ein
g P
arent
Co
mp
any’s
pro
po
rtio
nat
e s
har
e o
f exp
ense
s to
war
ds
mo
difi
catio
n i
n t
he b
uild
ing
stru
cture
and
equip
ments
, cl
aim
ed b
y th
e v
ario
us
landlo
rds
of
the p
ropert
ies
take
n o
n r
ent
by
the P
arent
Co
mpan
y.
3.
Cla
im o
f R
s. 1
7,4
64
,31
7 l
od
ged
by
som
e d
eve
lop
ers
on t
he P
arent
Co
mp
any
and
cla
ims
of
Rs.
7,6
81
,03
3 l
od
ged
by
the P
arent
Co
mp
any
on t
he d
eve
lop
ers
are
sub
ject
to
co
nfir
mat
ion/
reco
nci
liatio
n.
Ho
weve
r, t
he P
arent
Co
mpan
y has
duly
acc
ounte
d f
or
afo
resa
id c
laim
s in
the b
oo
ks.
Adju
stm
ents
, if
any,
whic
h i
n t
he o
pin
ion o
f th
e P
arent
Co
mpan
y, w
ill n
ot
be m
ateri
al w
ould
be
mad
e o
nce
the c
laim
s ar
e c
onfir
med/r
eco
nci
led.
4.
Additi
ons
to F
ixed A
ssets
and D
epre
ciat
ion f
or
the y
ear
incl
ude R
s. N
il, (
Pre
vio
us
year
Rs.
47
4,8
12
), a
nd R
s. N
il (P
revi
ous
year
Rs.
94
,98
9)
resp
ect
ively
acq
uir
ed a
t th
e t
ime o
f ac
quis
itio
n o
f a
sub
sid
iary
co
mp
any.
5.
Dep
reci
atio
n p
rovi
ded
fo
r th
e y
ear
is
net
of
reve
rsal
of
exc
ess
dep
reci
atio
n o
f R
s. 6
,56
4,3
99
pro
vid
ed
till
pre
vio
us
year
.
Schedule 6 : Deferred Tax Liabilities (Net)
84
Schedule 8 : Pre-Operative Expenses (pending allocation)As at As at
March 31, 2007 March 31, 2006(Rs.) (Rs.)
Balance brought forward 158,592,525 37,739,800Salary and other allowances 14,195,431 13,759,472Contribution to provident and other funds 1,042,562 1,023,487Staff welfare expenses 507,139 1,560,950Employee compensation expenses under employee share purchase 631,607 707,782scheme and employee stock option schemeRent 1,218,000 26,041,848Rates and taxes 2,992,832 13,333,453Communication costs 252,654 1,176,856Architect and other fees 11,388,774 15,526,857Professional charges 6,966,080 15,831,817Travelling and conveyance 2,712,036 11,750,797Printing and stationery 111,589 223,530Insurance 322,230 1,092,301Repairs and maintenance:- Buildings 3,179,095 6,703,152-Common area maintenance - 4,766,886Electricity and water charges (Net of recovery Rs. 1,037,161, 1,092,955 1,914,050Previous year Rs. 1,879,699)Security service charges 819,099 2,272,286Interest on fixed loans 14,497,945 24,144,576Interest to banks - 5,700,542Foreign exchange fluctuation 46,567 -Bank and other charges 1,403,000 3,560,000Fringe benefit tax 192,646 993,502Miscellaneous expenses 663,480 1,713,459
222,828,246 191,537,403Less : Interest received (Gross, tax deducted at source Rs. Nil, - 1,957,816Previous year Rs. 439,338)Less : Amount recovered from developers towards re-negotiation of rent 5,593,662 -Less : Allocated to fixed assets 144,268,953 30,987,062
Balance Carried Forward 72,965,631 158,592,525
NOTE:Rent includes amount paid to a director 918,000 918,000Rates and taxes includes stamp duty on registration of lease deed 1,772,300 11,732,700
Schedule 9 : consolidated Intangible AssetsRs.
Software Film rights’ Cost Total Previous YearDevelopment Cost
Gross BlockAt 01.04.2006 4,307,368 26,175,374 30,482,742 4,386,900Additions 3,597,856 20,303,532 23,901,388 26,095,842
At 31.03.2007 7,905,224 46,478,906 54,384,130 30,482,742
AmortisationAt 01.04.2006 1,175,133 14,062,967 15,238,100 2,438,220For the year 1,107,727 8,847,119 9,954,846 12,799,880
At 31.03.2007 2,282,860 22,910,086 25,192,946 15,238,100
For previous year 571,572 12,228,308 12,799,880 -
Net Block
At 31.03.2007 5,622,364 23,568,820 29,191,184 15,244,642
Capital Advances (Unsecured, considered good) 437,500 419,000
At 31.03.2007 5,622,364 23,568,820 29,628,684 15,663,642
At 31.03.2006 3,132,235 12,112,407 15,244,642 -
NOTE: Additions to Film Rights Cost include Rs. Nil (Previous year Rs. 7,115,088), acquired at the time of acquisition of a subsidiarycompany.
Schedules to the Consolidated accounts
84 85
Schedule 10 : Investment
As at As atMarch 31, 2007 March 31, 2006
(Rs.) (Rs.)
Long Term InvestmentsOther than trade investments
In Government Securities (Unquoted)6 years National Savings Certificates* 12,548,000 12,000,000(Deposited with Entertainment Tax Authorities)6 years National Savings Certificates** 45,000 45,000(Deposited with Municipal Corporation of Hyderabad)
Current InvestmentsOther than trade investments (Quoted)***Units in mutual funds of Rs. 10 each8,318,556.811 (Previous year Nil) units of P32ISD Prudential 83,185,568 -ICICI Liquid Plan - Super Institutional Daily Dividend
15,170,726.024 (Previous year Nil) units of OLPIPD HSBC 151,774,513 -Liquid Plus-Inst. Plus-Daily Dividend
13,022,840.564 (Previous year Nil) units of Reliance Liquidity Fund - 130,268,776 -Daily Dividend Reinvestment option -Reinvestment
Nil (Previous year 4,092,598.134) units of B503DD Birla Cash Plus - - 41,005,787Institutional Premium - Daily Dividend Reinvestment
Nil (Previous year 5,059,051.637) units of Kotak FMP Series XV - Dividend - 50,590,516
Nil (Previous year 10,000,000) units of C93 Chola FMP - Series 2 - 100,000,000(Quarterly Plan-I) - Dividend
Nil (Previous year 5,000,000) units of C95 Chola FMP - Series 2 - 50,000,000(Quarterly Plan-II) - Dividend
Units in mutual funds of Rs. 1,000 each42370.856 (Previous year Nil) units of UTI Liquid Cash Plan Institutional - 43,194,787 -Daily Income Option - Reinvestment
Nil (Previous year 40,520.284) units of DSP Merrill Lynch Liquidity Fund - - 40,528,388Institutional - Daily Dividend
421,016,644 294,169,691
NOTES:1. *Held in the name of the Managing Director in the interest of the 5,548,000 5,548,000
Parent Company.2. *Held in the name of the Director in the interest of the Subsidiary Company. 7,000,000 7,000,0003. **Held in the name of the Employee in the interest of the Parent Company.4. ***Invested out of unutilised monies out of issue of share capital and loan proceeds.
5. The following units held in mutual funds were purchasedand sold during the year:Purchased Value (Rs.)
- In Dividend option:Units in mutual funds of Rs. 10 each5,000,000.000 units of Reliance Fixed Horizon Fund I Monthly Plan- 50,000,000Series II Dividend Plan
15,006,491.916 units of Reliance Fixed Horizon Fund - Monthly Plan A - 150,064,919Series IV Dividend Option
15,075,739.448 units of Reliance Fixed Horizon Fund - Monthly Plan A - 150,757,394Series V Dividend Option
7,000,000.000 units of Reliance Fixed Horizon Fund Dividend Option 70,000,000
7,034,474.027 units of Reliance Fixed Horizon Fund Monthly Plan A Series II- 70,344,740Dividend Option
5,076,255.500 units of ABN AMRO FTP Series 3 Quarterly Plan D Dividend 50,762,555
5,076,923.310 units of Sundaram BNP Paribas Fixed Term Plan Series IX- 50,769,233Dividend Plan
5,024,112.866 units of TATA Fixed Horizon Fund Series -8 Scheme A IP -Dividend 50,241,500
7,712,499.816 units of P152RD Pru ICICI FMP Series 32- Three Month Plan -C- 77,124,998Retail Dividend
7,100,589.169 units of Kotak FMP 3M Series 1-Dividend 71,005,900
10,519.040 units of Kotak FMP Series XV - Dividend 105,228
25,764,537.712 units of PFRDD Prudential ICICI Floating Rate Plan D - 257,645,377Daily Dividend
Schedule 8 : Pre-Operative Expenses (pending allocation)
As at As atMarch 31, 2007 March 31, 2006
(Rs.) (Rs.)
Balance brought forward 158,592,525 37,739,800Salary and other allowances 14,195,431 13,759,472Contribution to provident and other funds 1,042,562 1,023,487Staff welfare expenses 507,139 1,560,950Employee compensation expenses under employee share purchase 631,607 707,782scheme and employee stock option schemeRent 1,218,000 26,041,848Rates and taxes 2,992,832 13,333,453Communication costs 252,654 1,176,856Architect and other fees 11,388,774 15,526,857Professional charges 6,966,080 15,831,817Travelling and conveyance 2,712,036 11,750,797Printing and stationery 111,589 223,530Insurance 322,230 1,092,301Repairs and maintenance:- Buildings 3,179,095 6,703,152-Common area maintenance - 4,766,886Electricity and water charges (Net of recovery Rs. 1,037,161, 1,092,955 1,914,050Previous year Rs. 1,879,699)Security service charges 819,099 2,272,286Interest on fixed loans 14,497,945 24,144,576Interest to banks - 5,700,542Foreign exchange fluctuation 46,567 -Bank and other charges 1,403,000 3,560,000Fringe benefit tax 192,646 993,502Miscellaneous expenses 663,480 1,713,459
222,828,246 191,537,403Less : Interest received (Gross, tax deducted at source Rs. Nil, - 1,957,816Previous year Rs. 439,338)Less : Amount recovered from developers towards re-negotiation of rent 5,593,662 -Less : Allocated to fixed assets 144,268,953 30,987,062
Balance Carried Forward 72,965,631 158,592,525
NOTE:Rent includes amount paid to a director 918,000 918,000Rates and taxes includes stamp duty on registration of lease deed 1,772,300 11,732,700
Schedule 9 : consolidated Intangible AssetsRs.
Software Film rights’ Cost Total Previous YearDevelopment Cost
Gross BlockAt 01.04.2006 4,307,368 26,175,374 30,482,742 4,386,900Additions 3,597,856 20,303,532 23,901,388 26,095,842
At 31.03.2007 7,905,224 46,478,906 54,384,130 30,482,742
AmortisationAt 01.04.2006 1,175,133 14,062,967 15,238,100 2,438,220For the year 1,107,727 8,847,119 9,954,846 12,799,880
At 31.03.2007 2,282,860 22,910,086 25,192,946 15,238,100
For previous year 571,572 12,228,308 12,799,880 -
Net Block
At 31.03.2007 5,622,364 23,568,820 29,191,184 15,244,642
Capital Advances (Unsecured, considered good) 437,500 419,000
At 31.03.2007 5,622,364 23,568,820 29,628,684 15,663,642
At 31.03.2006 3,132,235 12,112,407 15,244,642 -
NOTE: Additions to Film Rights Cost include Rs. Nil (Previous year Rs. 7,115,088), acquired at the time of acquisition of a subsidiarycompany.
Schedules to the Consolidated accounts Schedules to the Consolidated accounts
86
14,994,404.654 units of HSBC Cash Fund IP - Daily Dividend 150,028,015
19,865,822.305 units of LIC MF Liquid Fund Dividend Plan 218,128,7154,954,261.928 units of Sundaram BNP Paribas Money Fund Institutional 50,014,760Daily Dividend Reinvestment
35,063,763.178 units of Reliance liquidity Fund Daily Dividend 350,746,329Reinvestment option (Re-investment) (GS-DP)
7,019,729.360 units of Principal Floating Rate Fund FMP Institutional. Option - 70,202,207Dividend Reinvestment Daily
13,602.648 units of B503DD Birla Cash Plus - Institutional. Prem. - 136,292
Daily Dividend - Reinvestment
4,150,599.276 units of Kotak Liquid (Institutional Premium) - Daily Dividend 50,753,94322,663,282.967 units of P32ISD Prudential ICICI Institutional Liquid Plan - 226,632,830Super Institutional Daily Dividend
15170726.024 units of OLPIPD HSBC Liquid Plus-Inst. Plus - 151,774,513Daily Dividend
Units in mutual funds of Rs. 1000 each81,105.690 units of DSP Merrill Lynch Fixed Term Plan Series 1 D Dividend 81,105,847
101,017.788 units of G70 Standard Chartered Liquidity Managers-Plus-Daily Dividend 101,027,890
144,387.079 units of UTI Liquid Cash Plan Institutional-Daily Income Option - 147,194,787Re Investment
101,257.74 units of DSP Merrill lynch Liquid Plus IP-Daily Dividend 101,277,992
90,751.561 units of TATA Liquid Super High Investment Fund-Daily Dividend 101,144,430
596.704 units of DSP Merrill Lynch Liquidity Fund - Institutional - Daily Dividend 596,823
24,673.949 units of UTI Liquid Cash Plan Institutional - Daily Income Option - 25,153,751Reinvestment
Sold- In Dividend option:
Units in mutual funds of Rs. 10 each
5,000,000.000 units of C95 Chola FMP -Series 2 (Quarterly Plan II )-Dividend 50,021,500
10,000,000.000 units of C95 Chola FMP -Series 2 (Quarterly Plan I )-Dividend 100,093,000
5,000,000.000 units of Reliance Fixed Horizon Fund I Monthly Plan-Series II 50,000,000Dividend Plan
15,006,491.916 units of Reliance Fixed Horizon Fund - Monthly Plan A - 150,064,919Series IV Dividend Option
15,075,739.448 units of Reliance Fixed Horizon Fund - Monthly Plan A - 150,757,394Series V Dividend Option
7,000,000.000 units of Reliance Fixed Horizon Fund Dividend Option 70,000,000
7,034,474.027 units of Reliance Fixed Horizon Fund Monthly Plan A Series II - 70,344,740Dividend Option
5,076,255.500 units of ABN AMRO FTP Series 3 Quarterly Plan D Dividend 50,762,555
5,076,923.310 units of Sundaram BP Paribas Fixed Term Plan Series IX- Dividend Plan 50,769,233
5,024,112.866 units of TATA Fixed Horizon Fund Series -8 Scheme A IP -Dividend 50,318,500
7,712,499.816 units of P152RD Pru ICICI FMP Series 32- Three Month Plan -C- 77,124,998Retail Dividend
7,100,589.169 units of Kotak FMP 3M Series 1-Dividend 71,006,478
5,069,570.6775 units of Kotak FMP Series XV - Dividend 50,739,072
25,764,537.712 units of PFRDD Prudential ICICI Floating Rate Plan D-Daily Dividend 257,645,377
14,994,404.654 units of HSBC Cash Fund IP - Daily Dividend 150,028,015
19,865,822.305 units of LIC MF Liquid Fund Dividend Plan 218,128,715
4,954,261.928 units of Sundaram BNP Paribas Money Fund Institutional Daily 50,014,760Dividend Reinvestment
22,040,922.615 units of Reliance Liquidity Fund Daily Dividend Reinvestment 220,477,553option (Re-investment) (GS-DP)
7,019,729.360 units of Principal Floating Rate Fund FMP Institutional. Option - 70,202,207Dividend Reinvestment Daily
4,106,200.781 units of B503DD Birla Cash Plus - Institutional. Prem. - 41,142,079Daily Dividend - Reinvestment
4,150,599.276 units of Kotak Liquid (Institutional Premium) - Daily Dividend 50,753,943
Schedules to the Consolidated accounts
86 87
14,994,404.654 units of HSBC Cash Fund IP - Daily Dividend 150,028,015
19,865,822.305 units of LIC MF Liquid Fund Dividend Plan 218,128,7154,954,261.928 units of Sundaram BNP Paribas Money Fund Institutional 50,014,760Daily Dividend Reinvestment
35,063,763.178 units of Reliance liquidity Fund Daily Dividend 350,746,329Reinvestment option (Re-investment) (GS-DP)
7,019,729.360 units of Principal Floating Rate Fund FMP Institutional. Option - 70,202,207Dividend Reinvestment Daily
13,602.648 units of B503DD Birla Cash Plus - Institutional. Prem. - 136,292
Daily Dividend - Reinvestment
4,150,599.276 units of Kotak Liquid (Institutional Premium) - Daily Dividend 50,753,94322,663,282.967 units of P32ISD Prudential ICICI Institutional Liquid Plan - 226,632,830Super Institutional Daily Dividend
15170726.024 units of OLPIPD HSBC Liquid Plus-Inst. Plus - 151,774,513Daily Dividend
Units in mutual funds of Rs. 1000 each81,105.690 units of DSP Merrill Lynch Fixed Term Plan Series 1 D Dividend 81,105,847
101,017.788 units of G70 Standard Chartered Liquidity Managers-Plus-Daily Dividend 101,027,890
144,387.079 units of UTI Liquid Cash Plan Institutional-Daily Income Option - 147,194,787Re Investment
101,257.74 units of DSP Merrill lynch Liquid Plus IP-Daily Dividend 101,277,992
90,751.561 units of TATA Liquid Super High Investment Fund-Daily Dividend 101,144,430
596.704 units of DSP Merrill Lynch Liquidity Fund - Institutional - Daily Dividend 596,823
24,673.949 units of UTI Liquid Cash Plan Institutional - Daily Income Option - 25,153,751Reinvestment
Sold- In Dividend option:
Units in mutual funds of Rs. 10 each
5,000,000.000 units of C95 Chola FMP -Series 2 (Quarterly Plan II )-Dividend 50,021,500
10,000,000.000 units of C95 Chola FMP -Series 2 (Quarterly Plan I )-Dividend 100,093,000
5,000,000.000 units of Reliance Fixed Horizon Fund I Monthly Plan-Series II 50,000,000Dividend Plan
15,006,491.916 units of Reliance Fixed Horizon Fund - Monthly Plan A - 150,064,919Series IV Dividend Option
15,075,739.448 units of Reliance Fixed Horizon Fund - Monthly Plan A - 150,757,394Series V Dividend Option
7,000,000.000 units of Reliance Fixed Horizon Fund Dividend Option 70,000,000
7,034,474.027 units of Reliance Fixed Horizon Fund Monthly Plan A Series II - 70,344,740Dividend Option
5,076,255.500 units of ABN AMRO FTP Series 3 Quarterly Plan D Dividend 50,762,555
5,076,923.310 units of Sundaram BP Paribas Fixed Term Plan Series IX- Dividend Plan 50,769,233
5,024,112.866 units of TATA Fixed Horizon Fund Series -8 Scheme A IP -Dividend 50,318,500
7,712,499.816 units of P152RD Pru ICICI FMP Series 32- Three Month Plan -C- 77,124,998Retail Dividend
7,100,589.169 units of Kotak FMP 3M Series 1-Dividend 71,006,478
5,069,570.6775 units of Kotak FMP Series XV - Dividend 50,739,072
25,764,537.712 units of PFRDD Prudential ICICI Floating Rate Plan D-Daily Dividend 257,645,377
14,994,404.654 units of HSBC Cash Fund IP - Daily Dividend 150,028,015
19,865,822.305 units of LIC MF Liquid Fund Dividend Plan 218,128,715
4,954,261.928 units of Sundaram BNP Paribas Money Fund Institutional Daily 50,014,760Dividend Reinvestment
22,040,922.615 units of Reliance Liquidity Fund Daily Dividend Reinvestment 220,477,553option (Re-investment) (GS-DP)
7,019,729.360 units of Principal Floating Rate Fund FMP Institutional. Option - 70,202,207Dividend Reinvestment Daily
4,106,200.781 units of B503DD Birla Cash Plus - Institutional. Prem. - 41,142,079Daily Dividend - Reinvestment
4,150,599.276 units of Kotak Liquid (Institutional Premium) - Daily Dividend 50,753,943
14,344,726.156 units of P32ISD Prudential ICICI Institutional Liquid Plan - 143,447,262Super Institutional Daily Dividend
Units in mutual funds of Rs. 1000 each
81,105.690 units of DSP Merrill Lynch Fixed Term Plan Series 1 D Dividend 81,114,903
101,017.788 units of G70 Standard Chartered Liquidity Managers-Plus- 101,027,890Daily Dividend
102,016.223 units of UTI Liquid Cash Plan Institutional-Daily Income Option - 104,000,000Re Investment
101,257.74 units of DSP Merrill lynch Liquid Plus IP-Daily Dividend 101,277,992
90,751.561 units of TATA Liquid Super High Investment Fund-Daily Dividend 101,144,430
41,116.988 units of DSP Merrill Lynch Liquidity Fund - Institutional - Daily Dividend 41,125,211
24,673.949 units of UTI Liquid Cash Plan Institutional - Daily Income Option - 25,153,751Reinvestment
5. Aggregate value of investments March 31, 2007 March 31, 2006Market Value Cost Market Value Cost
Quoted 408,547,542 408,423,644 284,098,611 282,124,691Unquoted 12,593,000 12,045,000
421,016,644 294,169,691
Schedules to the Consolidated accounts Schedules to the Consolidated accounts
Schedule 11 : Inventories
Food and beverages 4,802,084 2,408,114
Stores and spares 12,813,202 6,838,460
17,615,286 9,246,574
Schedule 12 : Sundry debtorsDebts outstanding for a period exceeding six monthsSecured, considered good 1,467,682 180,000Unsecured, considered good 1,987,330 941,573Unsecured, considered doubtful 3,802,710 1,602,381
Other debtsSecured, considered good 1,836,801 3,194,358Unsecured, considered good 63,577,849 38,193,498Unsecured, considered doubtful 77,815 -
72,750,187 44,111,810Less : Provision for doubtful debts 3,880,525 1,602,381
68,869,662 42,509,429
Schedule 13 : Cash and bank balances
Cash on hand 7,637,959 3,463,772Cheques on hand 990,065 810,464Balances with scheduled banks:On current accounts 93,817,264 11,013,755On deposit accounts* 12,454,578 614,878,789On unpaid and unclaimed dividend accounts 470,996 -
115,370,862 630,166,780
* Includes unutilised monies out of issue of share capital amounting to Rs. Nil (Previous year Rs. 600,000,000) and fixed depositreceipts pledged with banks and customs department amounting to Rs. 12,060,576 (Previous year Rs. 12,752,565).
Schedule 14 : Other current assets
Interest accrued on deposits and others 3,427,426 8,236,114Income accrued for which invoices have been raised subsequently 1,372,999 2,105,546Insurance claims receivable 146,479 67,543
4,946,904 10,409,203
88
Schedules to the Consolidated accounts
Schedule 15 : Loans and advancesAs at As at
March 31, 2007 March 31, 2006(Rs.) (Rs.)
Unsecured, considered goodLoan to a Partnership firm - 1,033,426Loan to a body corporate 101,000,000 -Advances recoverable in cash or in kind or for value to be received 74,979,541 39,619,156Advance against share capital given to a proposed subsidiary 10,000,000 10,000,000Advance payment of Income Tax/Tax Deducted at Source/Tax Refundable* 63,797,108 29,265,032Deposits - others 317,474,267 230,486,294Unsecured, considered doubtfulAdvances recoverable in cash or in kind or for value to be received 250,798 250,798
567,501,714 310,654,706Less : Provision for doubtful advances 250,798 250,798
567,250,916 310,403,908
Included in Loans and advances are:Outstanding from a private limited company in which some of the directors of the 2,500,000 4,750,000Parent Company are interested as directors (Previous year twoprivate limited companies)*includes Rs. 70,000, (Previous year Rs. Nil) acquired by a subsidiary company atthe time of dissolution of its partnership firm
Schedule 16 : Current LiabilitiesSundry Creditors 287,857,638 197,912,563Unclaimed dividend (statutory liabilities as referred in Section 205C of the 470,996 -Companies Act, 1956)*Book overdraft with a bank - 1,955,084Security deposits 9,391,804 5,368,000Income received in advance (includes amount adjustable after one year Rs. Nil, 28,662,319 31,835,922Previous year Rs. 833,333)Interest accrued but not due on loans 1,669,033 1,597,598
328,051,790 238,669,167
Dues to small scale industrial undertaking included in Sundry creditors - 5,501Dues to other than small scale industrial undertakings included in Sundry creditors 287,857,638 197,907,062Included in Sundry Creditors are:Payable to Directors of the Parent Company 482,668 358,300
*Shall be transferred to Investor Education and Protection Fund (when due)
Schedule 17 : ProvisionsFor taxation 59,128,262 35,285,000For Interim Dividend
- on Equity Shares - 22,877,370- on Preference Shares - 5,219,178
For Corporate Dividend Tax - 3,944,852For Fringe Benefit Tax (Net of Payment) 787,486 151,410For Staff benefit schemes - Leave Encashment 5,375,513 3,231,852
- Gratuity 3,847,267 901,056
69,138,528 71,610,718
88 89
Schedules to the Consolidated accounts
Schedule 15 : Loans and advancesAs at As at
March 31, 2007 March 31, 2006(Rs.) (Rs.)
Unsecured, considered goodLoan to a Partnership firm - 1,033,426Loan to a body corporate 101,000,000 -Advances recoverable in cash or in kind or for value to be received 74,979,541 39,619,156Advance against share capital given to a proposed subsidiary 10,000,000 10,000,000Advance payment of Income Tax/Tax Deducted at Source/Tax Refundable* 63,797,108 29,265,032Deposits - others 317,474,267 230,486,294Unsecured, considered doubtfulAdvances recoverable in cash or in kind or for value to be received 250,798 250,798
567,501,714 310,654,706Less : Provision for doubtful advances 250,798 250,798
567,250,916 310,403,908
Included in Loans and advances are:Outstanding from a private limited company in which some of the directors of the 2,500,000 4,750,000Parent Company are interested as directors (Previous year twoprivate limited companies)*includes Rs. 70,000, (Previous year Rs. Nil) acquired by a subsidiary company atthe time of dissolution of its partnership firm
Schedule 16 : Current LiabilitiesSundry Creditors 287,857,638 197,912,563Unclaimed dividend (statutory liabilities as referred in Section 205C of the 470,996 -Companies Act, 1956)*Book overdraft with a bank - 1,955,084Security deposits 9,391,804 5,368,000Income received in advance (includes amount adjustable after one year Rs. Nil, 28,662,319 31,835,922Previous year Rs. 833,333)Interest accrued but not due on loans 1,669,033 1,597,598
328,051,790 238,669,167
Dues to small scale industrial undertaking included in Sundry creditors - 5,501Dues to other than small scale industrial undertakings included in Sundry creditors 287,857,638 197,907,062Included in Sundry Creditors are:Payable to Directors of the Parent Company 482,668 358,300
*Shall be transferred to Investor Education and Protection Fund (when due)
Schedule 17 : ProvisionsFor taxation 59,128,262 35,285,000For Interim Dividend
- on Equity Shares - 22,877,370- on Preference Shares - 5,219,178
For Corporate Dividend Tax - 3,944,852For Fringe Benefit Tax (Net of Payment) 787,486 151,410For Staff benefit schemes - Leave Encashment 5,375,513 3,231,852
- Gratuity 3,847,267 901,056
69,138,528 71,610,718
Schedules to the Consolidated accounts
Schedule 18 : Miscellaneous ExpenditureAs at As at
March 31, 2007 March 31, 2006(Rs.) (Rs.)
Miscellanous expenditure (To the extent not written off)
Share/debenture placement expensesAs per last account - 5,416,843Add: Incurred during the year - 113,195,755
- 118,612,598Less: Written off during the year - 118,612,598
- -
NOTES:1. The Parent Company had during the previous year incurred expenses amounting to Rs. 113,195,755 for the initial public offering
(IPO) of 5,700,000 equity shares (excluding sale of 2,000,000 equity shares held by an existing shareholder of the ParentCompany). The share placement expenses incurred on above issue was adjusted against securities premium account in theprevious year.
2. Expenses incurred on the initial public offering, during the previous year included Rs. 4,866,240 paid to statutory auditors ofParent Company towards certification charges etc. and Rs. 158,254 paid as fringe benefit tax.
Schedule 19 : Operating IncomeIncome from sale of tickets of films (including entertainment tax collected 1,216,957,384 880,052,280Rs. 291,582,187, Previous year Rs. 224,379,377)Income from Revenue Sharing 190,043,320 48,884,692Income from sale of film rights/distribution of films/commission of films 26,240,010 20,864,189Sale of food and beverages (including sales tax collected Rs. 40,692,112, 373,452,389 240,076,617Previous year Rs. 26,779,327)Advertisement (Gross Tax Deducted at source Rs. 4,963,656, 181,059,767 94,062,849Previous year Rs. 2,787,728)Royalty Income (to the extent of pouring fee, from a customer) 15,874,775 12,036,768(Gross Tax Deducted at source Rs. 670,956, Previous year Rs. Nil)Management fees (Gross Tax Deducted at source Rs. 242,469, 8,678,225 8,691,643Previous year Rs. 386,528) (including service tax collectedRs. 955,695, Previous year Rs. 799,107)
2,012,305,870 1,304,669,038
Schedule 20 : Other IncomeInterest
On bank deposits (Gross, Tax Deducted at Source Rs. 2,230,429, 10,356,753 11,072,561Previous year Rs. 2,472,685)On long term investments - Non Trade (Gross, Tax Deducted at Source 1,139,597 1,041,173Rs. Nil, Previous year Rs. Nil)From others (Gross, Tax Deducted at Source Rs. 649,283, Previous year Rs. Nil) 3,603,423 215,301Dividend income (from current investments - other than trade) 26,214,457 3,391,096Profit on sale of Current Investments - other than trade 242,763 -Rent received 3,754,199 -Royalty Income (to the extent of sign on fee, from a customer) 4,707,264 5,394,004Foreign exchange fluctuation (net) - 34,965Miscellaneous income (Gross, Tax Deducted at Source Rs. Nil, 11,276,790 7,824,533Previous year Rs. 22,997)
61,295,246 28,973,633
Schedule 21 : Personnel ExpensesSalary and other allowances 167,605,937 106,839,248Contribution to gratuity fund 3,771,802 1,727,917Contribution to provident and other funds 16,380,492 10,339,117Staff welfare expenses 8,454,351 6,623,748
196,212,582 125,530,030
90
Schedules to the Consolidated accounts
Schedule 22 : Operating and other expensesAs at As at
March 31, 2007 March 31, 2006(Rs.) (Rs.)
Rent (net of receipt from sub-lessees of Rs. 16,075,502, 177,504,336 114,660,004Previous year Rs. 14,074,573)Rates and taxes 9,339,697 5,623,803Communication costs 16,887,176 9,218,529Professional charges 21,973,423 14,658,748Advertisement and publicity (excluding Rs. 28,229,326, 75,249,270 46,649,504Previous year Rs. 23,540,874 borne by other co-sponsors)Business promotion and entertainment 2,563,994 3,467,973Travelling and conveyance 37,774,636 20,498,555Printing and stationery 9,551,355 6,568,303Insurance 7,436,269 5,190,407Repairs and maintenance :- Buildings 27,197,282 11,238,792- Plant & Machinery 16,309,327 13,069,886- Common area maintenance 90,443,457 61,355,837- Others 8,821,833 7,350,110Electricity and water charges 94,902,697 49,036,196Auditor’s remuneration- Audit fee 1,800,357 1,368,470- Tax audit fee 306,930 246,520- Quarterly limited review of accounts 1,010,160 220,400- Certification etc. 123,464 426,350- Out-of-pocket expenses 28,141 58,630Security service charges 19,695,965 12,308,626Discount on sales 971,113 1,068,235Donations 527,525 182,000Irrecoverable balances written off (net) 173,534 -Provision for doubtful debts 2,278,143 1,602,381Loss on sale/discard of fixed assets (net) 1,303,110 2,515,492Loss on sale of current investments - other than trade - 35,506Directors Sitting Fees 440,000 320,000Bank and other charges 6,074,733 3,804,044Miscellaneous expenses 18,815,871 11,752,906
649,503,798 404,496,207
Rent includes amount paid to directors 4,374,000 4,374,000
Schedule 23 : Interest paidIntereston fixed loans and debentures 43,439,556 29,370,741to banks and others 421,884 1,366,416
43,861,440 30,737,157
Schedule 24 : Earning Per share (eps)Net profit as per profit and loss account 101,894,942 52,864,893Less: Dividend on Preference Shares and tax thereon 11,402,500 5,951,168
Net Profit for calculation of basic and diluted EPS 90,492,442 46,913,725
Weighted average number of equity shares in calculating basic EPS:Number of equity shares outstanding at the beginning of the year 22,877,370 17,097,370Equity shares allotted on January 31, 2007 (outstanding for 59 days) 38,000 -Equity shares allotted on March 31, 2007 (outstanding for 1 day) 98,500 -Equity shares allotted on September 22, 2005 (outstanding for 191 days) - 80,000Equity shares allotted on December 27, 2005 (outstanding for 95 days) - 5,700,000Number of equity shares outstanding at the end of the year 23,013,870 22,877,370
Weighted number of equity shares of Rs. 10 each outstanding during the year 22,883,782 18,622,795
Weighted average number of equity shares in calculating diluted EPS:Weighted number of equity shares of Rs. 10 each outstanding during the year (as above) 22,883,782 18,622,795Add: Effect of stock options - 33,593
Weighted number of equity shares of Rs. 10 each outstanding during the year 22,883,782 18,656,388
Basic Earnings Per Share 3.95 2.52Diluted Earnings Per Share 3.95 2.51
90 91
Schedules to the Consolidated accounts
Schedule 22 : Operating and other expensesAs at As at
March 31, 2007 March 31, 2006(Rs.) (Rs.)
Rent (net of receipt from sub-lessees of Rs. 16,075,502, 177,504,336 114,660,004Previous year Rs. 14,074,573)Rates and taxes 9,339,697 5,623,803Communication costs 16,887,176 9,218,529Professional charges 21,973,423 14,658,748Advertisement and publicity (excluding Rs. 28,229,326, 75,249,270 46,649,504Previous year Rs. 23,540,874 borne by other co-sponsors)Business promotion and entertainment 2,563,994 3,467,973Travelling and conveyance 37,774,636 20,498,555Printing and stationery 9,551,355 6,568,303Insurance 7,436,269 5,190,407Repairs and maintenance :- Buildings 27,197,282 11,238,792- Plant & Machinery 16,309,327 13,069,886- Common area maintenance 90,443,457 61,355,837- Others 8,821,833 7,350,110Electricity and water charges 94,902,697 49,036,196Auditor’s remuneration- Audit fee 1,800,357 1,368,470- Tax audit fee 306,930 246,520- Quarterly limited review of accounts 1,010,160 220,400- Certification etc. 123,464 426,350- Out-of-pocket expenses 28,141 58,630Security service charges 19,695,965 12,308,626Discount on sales 971,113 1,068,235Donations 527,525 182,000Irrecoverable balances written off (net) 173,534 -Provision for doubtful debts 2,278,143 1,602,381Loss on sale/discard of fixed assets (net) 1,303,110 2,515,492Loss on sale of current investments - other than trade - 35,506Directors Sitting Fees 440,000 320,000Bank and other charges 6,074,733 3,804,044Miscellaneous expenses 18,815,871 11,752,906
649,503,798 404,496,207
Rent includes amount paid to directors 4,374,000 4,374,000
Schedule 23 : Interest paidIntereston fixed loans and debentures 43,439,556 29,370,741to banks and others 421,884 1,366,416
43,861,440 30,737,157
Schedule 24 : Earning Per share (eps)Net profit as per profit and loss account 101,894,942 52,864,893Less: Dividend on Preference Shares and tax thereon 11,402,500 5,951,168
Net Profit for calculation of basic and diluted EPS 90,492,442 46,913,725
Weighted average number of equity shares in calculating basic EPS:Number of equity shares outstanding at the beginning of the year 22,877,370 17,097,370Equity shares allotted on January 31, 2007 (outstanding for 59 days) 38,000 -Equity shares allotted on March 31, 2007 (outstanding for 1 day) 98,500 -Equity shares allotted on September 22, 2005 (outstanding for 191 days) - 80,000Equity shares allotted on December 27, 2005 (outstanding for 95 days) - 5,700,000Number of equity shares outstanding at the end of the year 23,013,870 22,877,370
Weighted number of equity shares of Rs. 10 each outstanding during the year 22,883,782 18,622,795
Weighted average number of equity shares in calculating diluted EPS:Weighted number of equity shares of Rs. 10 each outstanding during the year (as above) 22,883,782 18,622,795Add: Effect of stock options - 33,593
Weighted number of equity shares of Rs. 10 each outstanding during the year 22,883,782 18,656,388
Basic Earnings Per Share 3.95 2.52Diluted Earnings Per Share 3.95 2.51
Schedule 25: Notes to The Consolidated AccountsNOTES annexed to and forming part of the Consolidated Balance Sheet as at March 31, 2007, Consolidated Profit and Loss Accountand Consolidated Cash Flow Statement for the year ended on that date.
1. Principles of Consolidation
The Consolidated Financial Statements relate to PVR Limited (Parent Company) and its Subsidiary Companies (hereinafter referredas the “PVR Group”). The Consolidated Financial Statements have been prepared on the following basis:
(i) The financial statements of the Parent Company and its Subsidiary Companies have been combined on a line by line basis byadding together the book values of like items of assets, liabilities, income and expenses after fully eliminating intra groupbalances and intra group transactions resulting in unrealized profits or losses, if any, as per Accounting Standard – 21,Consolidated Financial Statements, issued by The Institute of Chartered Accountants of India.
(ii) In case of one Subsidiary (PVR Pictures Limited, having interest in a partnership firm), interest in the assets, liabilities, income andexpenses of a Joint Venture Partnership Firm have been consolidated using proportionate consolidation method upto the date ofdissolution of said partnership firm. Intra group balances, transactions and unrealized profit/losses, if any, have been eliminatedto the extent of Subsidiary’s proportionate share.
(iii) The Subsidiary Companies which are included in the consolidation and the Parent Company’s holding therein is as under:
Name of Subsidiary Company Country Of Incorporation Percentage of Ownership asat March 31, 2007
CR Retail Malls (India) Private Limited India 100
PVR Pictures Limited (including PVR Factory India 100Distribution Network - A partnership firm in whichthe company was a partner to the extent of50% till May 31, 2006)
(iv) The financial statements of the Subsidiary Companies used in the consolidation are drawn for the same period as that of theParent Company i.e. year ended March 31, 2007.
(v) Goodwill represents the difference between the Parent Company’s share in the net worth of a Subsidiary Company (CR RetailMalls (India) Private Limited) and the cost of acquisition at the time of making the investment in the Subsidiary Company. Forthis purpose, the Parent Company’s share of net worth of the Subsidiary Company is determined on the basis of the latestfinancial statements of the Subsidiary Company prior to acquisition, after making necessary adjustments for material eventsbetween the date of such financial statements and the date of respective acquisition. Goodwill is amortised pro-rata over aperiod of 5 years from the date of acquisition.
(vi) Capital Reserve represents the difference between the Parent Company’s share in the net worth of a Subsidiary Company (PVRPictures Limited) and the cost of acquisition at the time of making the investment in the Subsidiary Company. For this purpose,the Parent Company‘s share of net worth of the Subsidiary Company is determined on the basis of the latest financialstatements of the Subsidiary Company prior to acquisition, after making necessary adjustments for material events between thedate of such financial statements and the date of respective acquisition.
(vii) As far as possible, the Consolidated Financial Statements have been prepared using uniform accounting policies for liketransactions and other events in similar circumstances and are presented to the extent possible, in the same manner as theParent Company’s separate financial statements. Differences in the accounting policies, if any, have been disclosed separately.
2. Goodwill (on Consolidation)
The Goodwill in the Consolidated Financial Statements represents the excess of the purchase consideration of investment over thePVR Limited’s share in the net assets of its subsidiary – CR Retail Malls (India) Private Limited.
Particulars March 31, 2005 (Rs.)
Investment - Fresh equity shares issued by CR Retail Malls (India) Private Limited 7,000,000on October 4, 2004PVR Limited’s share in the net assets of its subsidiary 5,448,602
Goodwill (A) 1,551,398
Investment – Additional equity shares purchased from The Phoenix Mills Limited 100,000on March 28, 2005PVR Limited’s share in the net assets of its subsidiary 82,460
Goodwill (B) 17,540
March 31, 2007 (Rs.)Investment – Additional equity shares issued by CR Retail Malls (India) Private Limited 192,900,000on March 30, 2007PVR Limited’s share in the net assets of its subsidiary 191,231,639
Goodwill (C) 1,668,361
Total Goodwill (A+B+C) 3,237,299
Notes to the Consolidated accounts
92
PVR Limited has made investment by way of 19,290,000 equity shares of Rs. 10 each of CR Retail Malls (India) Private Limited onMarch 30, 2007. Goodwill amounting to Rs. 1,668,361 has been worked out based on the net assets value of the subsidiary as onMarch 29, 2007. Financial statements as at March 29, 2007 drawn by the management for this purpose have been audited by theirstatutory auditors.
3. Capital Reserve (on Consolidation)
The Capital Reserve in the Consolidated Financial Statements represents the excess of the PVR Limited’s share in the net assets of itssubsidiary (PVR Pictures Limited) over the purchase consideration of investment.
Particulars March 31, 2006 (Rs.)
Fresh equity shares issued by PVR Pictures Limited on April 5, 2005 14,500,000PVR Limited’s share in the net assets of its subsidiaries 14,524,483
Capital Reserve (A) 24,483
Investment – Additional equity shares purchased from erstwhile shareholders of PVR Pictures Limited 500,000
PVR Limited’s share in the net assets of its subsidiary 500,000
Capital Reserve (B) -
Total Capital Reserve (A + B) 24,483
4. Statement of Significant Accounting Policies
(a) Basis of preparation
The financial statements are prepared to comply in all material respects with the mandatory Accounting Standards issued by theInstitute of Chartered Accountants of India and the relevant provisions of the Companies Act, 1956. The financial statements areprepared under the historical cost convention on an accrual basis. The accounting policies have been consistently applied by the PVRGroup and except for the change in accounting policy disclosed more fully below, are consistent with those used in the previous year.
(b) Change in Accounting Policy
Till March 31, 2006 the Parent Company was providing for leave benefits based on actuarial valuation in accordance with oldAccounting Standard 15. In the current year, the Parent Company has opted for early adoption of the Accounting Standard 15(Revised 2005) which is otherwise mandatory for accounting periods commencing on or after December 7, 2006. Accordingly theParent Company has changed the basis of providing short term leave benefits. As a result, actuarial valuation of leave as at April 1,2006 is higher by Rs. 270,219 (net of income-tax Rs. 137,106) which in accordance with the transitional provision in the revisedAccounting Standard, has been adjusted to the opening balance of Profit and Loss Account. This change does not have materialimpact on the profit for the current year.
(c) Fixed Assets
Fixed Assets are stated at Cost less accumulated depreciation and impairment losses, if any. Cost comprises the purchase price andany directly attributable cost of bringing the asset in its working condition for its intended use. Financing costs relating to acquisition ofqualifying Fixed Assets are also included to the extent they relate to the period till such assets are ready for their intendeduse.Leasehold improvements represent expenses incurred towards civil works, interior furnishings, etc. on the leased premises atthe various locations.
(d) Goodwill
Goodwill represents the difference between the Parent Company’s share in the net worth of the Subsidiary Company and the cost ofacquisition at the time of making the investment in the Subsidiary Company. For this purpose, the Parent Company’s share of networth of the Subsidiary Company is determined on the basis of the latest financial statements of the Subsidiary Company prior toacquisition, after making necessary adjustments for material events between the date of such financial statements and the date ofrespective acquisition.
(e) Depreciation
Leasehold Improvements are amortized over the estimated useful life or unexpired period of lease (whichever is lower) on a straightline basis.
Cost of structural improvements at premises where Parent Company has entered into agreement with the parties to operate andmanage Multiscreen/Single Screen Cinemas on revenue sharing basis are amortized over the estimated useful life or lock in period ofthe agreement (whichever is lower) on a straight line basis.
Depreciation on all other assets is provided on Straight-Line Method at the rates computed based on estimated useful life ofthe assets, which are equal to the corresponding rates prescribed in Schedule XIV to the Companies Act, 1956. Depreciation onadditions/deletions to fixed assets due to foreign exchange fluctuation is provided/adjusted over the remaining useful life of suchassets.
Assets costing Rs. 5,000 and below are fully depreciated in the year of acquisition.
Goodwill arising out of acquiring share in a Subsidiary Company is amortised pro-rata over a period of 5 years from the date ofacquisition.
Notes to the Consolidated accounts
92 93
PVR Limited has made investment by way of 19,290,000 equity shares of Rs. 10 each of CR Retail Malls (India) Private Limited onMarch 30, 2007. Goodwill amounting to Rs. 1,668,361 has been worked out based on the net assets value of the subsidiary as onMarch 29, 2007. Financial statements as at March 29, 2007 drawn by the management for this purpose have been audited by theirstatutory auditors.
3. Capital Reserve (on Consolidation)
The Capital Reserve in the Consolidated Financial Statements represents the excess of the PVR Limited’s share in the net assets of itssubsidiary (PVR Pictures Limited) over the purchase consideration of investment.
Particulars March 31, 2006 (Rs.)
Fresh equity shares issued by PVR Pictures Limited on April 5, 2005 14,500,000PVR Limited’s share in the net assets of its subsidiaries 14,524,483
Capital Reserve (A) 24,483
Investment – Additional equity shares purchased from erstwhile shareholders of PVR Pictures Limited 500,000
PVR Limited’s share in the net assets of its subsidiary 500,000
Capital Reserve (B) -
Total Capital Reserve (A + B) 24,483
4. Statement of Significant Accounting Policies
(a) Basis of preparation
The financial statements are prepared to comply in all material respects with the mandatory Accounting Standards issued by theInstitute of Chartered Accountants of India and the relevant provisions of the Companies Act, 1956. The financial statements areprepared under the historical cost convention on an accrual basis. The accounting policies have been consistently applied by the PVRGroup and except for the change in accounting policy disclosed more fully below, are consistent with those used in the previous year.
(b) Change in Accounting Policy
Till March 31, 2006 the Parent Company was providing for leave benefits based on actuarial valuation in accordance with oldAccounting Standard 15. In the current year, the Parent Company has opted for early adoption of the Accounting Standard 15(Revised 2005) which is otherwise mandatory for accounting periods commencing on or after December 7, 2006. Accordingly theParent Company has changed the basis of providing short term leave benefits. As a result, actuarial valuation of leave as at April 1,2006 is higher by Rs. 270,219 (net of income-tax Rs. 137,106) which in accordance with the transitional provision in the revisedAccounting Standard, has been adjusted to the opening balance of Profit and Loss Account. This change does not have materialimpact on the profit for the current year.
(c) Fixed Assets
Fixed Assets are stated at Cost less accumulated depreciation and impairment losses, if any. Cost comprises the purchase price andany directly attributable cost of bringing the asset in its working condition for its intended use. Financing costs relating to acquisition ofqualifying Fixed Assets are also included to the extent they relate to the period till such assets are ready for their intendeduse.Leasehold improvements represent expenses incurred towards civil works, interior furnishings, etc. on the leased premises atthe various locations.
(d) Goodwill
Goodwill represents the difference between the Parent Company’s share in the net worth of the Subsidiary Company and the cost ofacquisition at the time of making the investment in the Subsidiary Company. For this purpose, the Parent Company’s share of networth of the Subsidiary Company is determined on the basis of the latest financial statements of the Subsidiary Company prior toacquisition, after making necessary adjustments for material events between the date of such financial statements and the date ofrespective acquisition.
(e) Depreciation
Leasehold Improvements are amortized over the estimated useful life or unexpired period of lease (whichever is lower) on a straightline basis.
Cost of structural improvements at premises where Parent Company has entered into agreement with the parties to operate andmanage Multiscreen/Single Screen Cinemas on revenue sharing basis are amortized over the estimated useful life or lock in period ofthe agreement (whichever is lower) on a straight line basis.
Depreciation on all other assets is provided on Straight-Line Method at the rates computed based on estimated useful life ofthe assets, which are equal to the corresponding rates prescribed in Schedule XIV to the Companies Act, 1956. Depreciation onadditions/deletions to fixed assets due to foreign exchange fluctuation is provided/adjusted over the remaining useful life of suchassets.
Assets costing Rs. 5,000 and below are fully depreciated in the year of acquisition.
Goodwill arising out of acquiring share in a Subsidiary Company is amortised pro-rata over a period of 5 years from the date ofacquisition.
(f) Intangibles
Software:
Cost relating to purchased software’s is capitalised and is amortised on a Straight-Line Basis over their estimated useful lives of sixyears.
Software licenses costing Rs 5,000 and below are fully depreciated in the year of acquisition.
Film Rights’ Cost:
Film right cost is capitalised and is amortised fully as and when the film is released.
(g) Leases
Where the PVR Group is the lessee:
Finance leases, which effectively transfer to the PVR Group substantially all the risks and benefits incidental to ownership of the leaseditem, are capitalized at the lower of the fair value and present value of the minimum lease payments at the inception of the leaseterm and disclosed as leased assets. Lease payments are apportioned between the finance charges and reduction of the lease liabilitybased on the implicit rate of return. Finance charges are charged directly against income. Lease management fees, legal charges andother initial direct costs are capitalised.
If there is no reasonable certainty that the PVR Group will obtain the ownership by the end of the lease term, capitalized leasedassets are depreciated over the shorter of the estimated useful life of the asset or the lease term.
Leases where the lessor effectively retains substantially all the risks and benefits of ownership of the leased term, are classified asoperating leases. Operating lease payments are recognized as an expense in the Profit and Loss Account on a straight-line basis overthe lease term.
Where the PVR Group is the lessor: Assets given under a finance lease are recognised as a receivable at an amount equal to thenet investment in the lease. Lease rentals are apportioned between principal and interest on the IRR method. The principal amountreceived reduces the net investment in the lease and interest is recognised as revenue. Initial direct costs such as legal costs,brokerage costs, etc. are recognised immediately in the Profit and Loss Account.
Assets subject to operating leases are included in fixed assets. Lease income is recognised in the Profit and Loss Account on astraight-line basis over the lease term. Costs, including depreciation are recognised as an expense in the Profit and Loss Account.Initial direct costs such as legal costs, brokerage costs, etc. are recognised immediately in the Profit and Loss Account.
(h) Expenditure on new projects and substantial expansion
Expenditure directly relating to construction activity is capitalised. Indirect expenditure incurred during construction period iscapitalised as part of the indirect construction cost to the extent expenditure is related to construction or is incidental thereto. Otherindirect expenditure (including borrowing costs) incurred during the construction period, which is not related to the constructionactivity nor is incidental thereto is charged to the Profit and Loss Account. Income earned during construction period is adjustedagainst the total of the indirect expenditure.
All direct capital expenditure on expansion is capitalised. As regards indirect expenditure on expansion, only that portion is capitalisedwhich represents the marginal increase in such expenditure involved as a result of capital expansion. Both direct and indirectexpenditure are capitalised only if they increase the value of the asset beyond its originally assessed standard of performance.
(i) Investments
Investments that are readily realizable and intended to be held for not more than a year are classified as current investments. Allother investments are classified as long term investments. Current investments are carried at lower of cost and fair valuedetermined on an individual investment basis. Long term investments are carried at cost. However, provision for diminution in thevalue is made to recognize a decline other than temporary in the value of the investments.
(j) Inventories
Inventories are valued as follows:
Food and beverages Lower of cost and net realizable value. Cost is determined on First In First OutBasis.
Stores and spares Lower of cost and net realizable value. Cost is determined on First In First OutBasis.
Net realizable value is the estimated selling price in the ordinary course of business, less estimated costs necessary to make the sale.
(k) Revenue recognition
Revenue is recognized to the extent that it is probable that the economic benefits will flow to the PVR Group and the revenue can bereliably measured. Amount of entertainment tax, sales tax and service tax collected on generating operating revenue has beenshown as a reduction from the operating revenue.
Sale of Tickets of FilmsRevenue from sale of tickets of films is recognised as and when the film is exhibited.
Sale of Food and BeveragesRevenue from sale of food and beverages is recognised upon passage of title to customers, which coincides with their delivery.
Notes to the Consolidated accountsNotes to the Consolidated accounts
94
Income from Distribution of filmsTheatrical revenue from the distribution of films is accounted for on the basis of box office reports received from various exhibitorsand revenue from the sale of satellite / TV rights is recognised at the time of initial period of transfer of right to the customer.
Sharing RevenueIncome from revenue sharing is recognized in accordance with the terms of agreement with parties to operate and manageMultiscreen/ Single screen Cinemas, namely PVR EDM, PVR Lucknow, PVR Indore, PVR Mulund and PVR Aligarh in coordinatedmanner.
Advertisement RevenueAdvertisement revenue is recognised as and when advertisement is displayed at the cinema halls.
Royalty Income (to the extent of Pouring Fee, from a customer) and Management Fee RevenueRevenue is recognised on an accrual basis in accordance with the terms of the relevant agreements.
Royalty Income (to the extent of Sign on Fee from customers)Revenue of one time sign on fee from customers is recognized on an annual basis as per the agreements. The amount of sign on feereceived for unexpired period of agreements is deferred, which is recognized in the relevant year to which it pertains.
Interest IncomeInterest revenue is recognised on a time proportion basis, taking into account the amount outstanding and the rates applicable.
Dividend IncomeRevenue is recognized where the shareholder’s right to receive payment is established by the balance sheet date.
Rent IncomeRevenue from rent is recognized based upon the contract, for the period the property has been let out.
(l) Foreign currency transactions
(i) Initial RecognitionForeign currency transactions are recorded in the reporting currency, by applying to the foreign currency amount the exchangerate between the reporting currency and the foreign currency at the date of the transaction.
(ii) ConversionForeign currency monetary items are reported using the closing rate. Non-monetary items which are carried in terms ofhistorical cost denominated in a foreign currency, are reported using the exchange rate at the date of the transaction and non-monetary items which are carried at fair value or other similar valuation denominated in a foreign currency are reported usingthe exchange rates that existed when the values were determined.
(iii) Exchange DifferencesExchange differences arising on the settlement of monetary items at rates different from those at which they were initiallyrecorded during the year or reported in previous financial statements, are recognized as income or as expense in the year inwhich they arise except gain or loss on transactions relating to acquisition of Fixed Assets/Intangibles from outside India, whichis adjusted to the carrying amount of the Fixed Assets/Intangibles.
(m) Retirement and other employee benefits
i. Retirement benefits in the form of Provident Fund are a defined contribution scheme and the contributions are charged to theProfit and Loss Account of the year when the contributions to the respective funds are due. There are no other obligationsother than the contribution payable to the respective trusts.
ii. Gratuity is a defined benefit obligation. The PVR Group has created an approved gratuity fund for the future payment ofgratuity to the employees. The PVR Group accounts for the gratuity liability, based upon the actuarial valuation carried out atthe year end, by an independent actuary. Gratuity liability of an employee, who leaves the PVR Group before the close of theyear and which is remaining unpaid, is provided on actual computation basis.
iii. Short term compensated absences are provided for on based on estimates. Long term compensated balances are provided forbased on actuarial valuation. Leave encashment liability of an employee, who leaves the PVR Group before the close of theyear and which is remaining unpaid, is provided for on actual computation basis.
iv. Actuarial gains/losses are immediately taken to profit and loss account and are not deferred.
(n) Income taxes
Tax expense comprises of current, deferred and fringe benefit tax. Current income tax and fringe benefit tax is measured at theamount expected to be paid to the tax authorities in accordance with the Indian Income Tax Act. Deferred income taxes reflect theimpact of current year timing differences between taxable income and accounting income for the year and reversal of timingdifferences of earlier years.
Deferred tax is measured based on the tax rates and the tax laws enacted or substantively enacted at the balance sheet date.Deferred tax assets are recognised only to the extent that there is reasonable certainty that sufficient future taxable income will beavailable against which such deferred tax assets can be realised. In case where the Concerned Company has unabsorbed depreciationor carry forward tax losses, entire deferred tax assets are recognised only if there is virtual certainty supported by convincingevidence that they can be realised against future taxable profits. Unrealised deferred tax assets of earlier years are re-assessed andrecognized to the extent that it has become reasonably certain or virtually certain, as the case may be that sufficient future taxableincome will be available against which such deferred tax assets can be realised.
Notes to the Consolidated accounts
94 95
Income from Distribution of filmsTheatrical revenue from the distribution of films is accounted for on the basis of box office reports received from various exhibitorsand revenue from the sale of satellite / TV rights is recognised at the time of initial period of transfer of right to the customer.
Sharing RevenueIncome from revenue sharing is recognized in accordance with the terms of agreement with parties to operate and manageMultiscreen/ Single screen Cinemas, namely PVR EDM, PVR Lucknow, PVR Indore, PVR Mulund and PVR Aligarh in coordinatedmanner.
Advertisement RevenueAdvertisement revenue is recognised as and when advertisement is displayed at the cinema halls.
Royalty Income (to the extent of Pouring Fee, from a customer) and Management Fee RevenueRevenue is recognised on an accrual basis in accordance with the terms of the relevant agreements.
Royalty Income (to the extent of Sign on Fee from customers)Revenue of one time sign on fee from customers is recognized on an annual basis as per the agreements. The amount of sign on feereceived for unexpired period of agreements is deferred, which is recognized in the relevant year to which it pertains.
Interest IncomeInterest revenue is recognised on a time proportion basis, taking into account the amount outstanding and the rates applicable.
Dividend IncomeRevenue is recognized where the shareholder’s right to receive payment is established by the balance sheet date.
Rent IncomeRevenue from rent is recognized based upon the contract, for the period the property has been let out.
(l) Foreign currency transactions
(i) Initial RecognitionForeign currency transactions are recorded in the reporting currency, by applying to the foreign currency amount the exchangerate between the reporting currency and the foreign currency at the date of the transaction.
(ii) ConversionForeign currency monetary items are reported using the closing rate. Non-monetary items which are carried in terms ofhistorical cost denominated in a foreign currency, are reported using the exchange rate at the date of the transaction and non-monetary items which are carried at fair value or other similar valuation denominated in a foreign currency are reported usingthe exchange rates that existed when the values were determined.
(iii) Exchange DifferencesExchange differences arising on the settlement of monetary items at rates different from those at which they were initiallyrecorded during the year or reported in previous financial statements, are recognized as income or as expense in the year inwhich they arise except gain or loss on transactions relating to acquisition of Fixed Assets/Intangibles from outside India, whichis adjusted to the carrying amount of the Fixed Assets/Intangibles.
(m) Retirement and other employee benefits
i. Retirement benefits in the form of Provident Fund are a defined contribution scheme and the contributions are charged to theProfit and Loss Account of the year when the contributions to the respective funds are due. There are no other obligationsother than the contribution payable to the respective trusts.
ii. Gratuity is a defined benefit obligation. The PVR Group has created an approved gratuity fund for the future payment ofgratuity to the employees. The PVR Group accounts for the gratuity liability, based upon the actuarial valuation carried out atthe year end, by an independent actuary. Gratuity liability of an employee, who leaves the PVR Group before the close of theyear and which is remaining unpaid, is provided on actual computation basis.
iii. Short term compensated absences are provided for on based on estimates. Long term compensated balances are provided forbased on actuarial valuation. Leave encashment liability of an employee, who leaves the PVR Group before the close of theyear and which is remaining unpaid, is provided for on actual computation basis.
iv. Actuarial gains/losses are immediately taken to profit and loss account and are not deferred.
(n) Income taxes
Tax expense comprises of current, deferred and fringe benefit tax. Current income tax and fringe benefit tax is measured at theamount expected to be paid to the tax authorities in accordance with the Indian Income Tax Act. Deferred income taxes reflect theimpact of current year timing differences between taxable income and accounting income for the year and reversal of timingdifferences of earlier years.
Deferred tax is measured based on the tax rates and the tax laws enacted or substantively enacted at the balance sheet date.Deferred tax assets are recognised only to the extent that there is reasonable certainty that sufficient future taxable income will beavailable against which such deferred tax assets can be realised. In case where the Concerned Company has unabsorbed depreciationor carry forward tax losses, entire deferred tax assets are recognised only if there is virtual certainty supported by convincingevidence that they can be realised against future taxable profits. Unrealised deferred tax assets of earlier years are re-assessed andrecognized to the extent that it has become reasonably certain or virtually certain, as the case may be that sufficient future taxableincome will be available against which such deferred tax assets can be realised.
(o) Segment Reporting Polices
Identification of segmentsThe PVR Group’s operating businesses are organized and managed separately according to the nature of products and servicesprovided, with each segment representing a strategic business unit that offers different products and serves different markets. Theanalysis of geographical segments is based on the areas in which major operating divisions of the PVR Group operate.
Unallocated itemsThe Corporate and Other segment includes general corporate income and expense items which are not allocated to any businesssegment.
(p) Impairment
The carrying amounts of assets are reviewed at each balance sheet date if there is any indication of impairment based on internal/external factors. An impairment loss is recognized wherever the carrying amounts of an asset exceed its recoverable amount. Therecoverable amount is the greater of the assets net selling price and value in use. In assessing value in use, the estimated future cashflows are discounted to their present value at the weighted average cost of capital.
(q) Provisions
A provision is recognised when the PVR Group has a present obligation as a result of past event and it is probable that an outflow ofresources will be required to settle the obligation, in respect of which a reliable estimate can be made.
Provisions except those disclosed elsewhere in the financial statements, are not discounted to their present value and are determinedbased on best management estimate required to settle the obligation at each Balance Sheet date. These are reviewed at eachBalance Sheet date and are adjusted to reflect the current best management estimates.
(r) Earning Per share
Basic Earnings Per Share is calculated by dividing the net profit or loss for the year attributable to equity shareholders (after deductingdividend on preference shares and attributable taxes) by the weighted average number of equity shares outstanding during the year.The weighted average number of equity shares outstanding during the year are adjusted for events of bonus issue; bonus element ina rights issue to existing shareholders; share split; and reverse share split (consolidation of shares). Partly paid equity shares aretreated as a fraction of an equity share to the extent that they were entitled to participate in dividends relative to a fully paid equityshare during the reporting year.
For the purpose of calculating Diluted Earnings Per Share, the net profit or loss for the year attributable to equity shareholders andthe weighted average number of shares outstanding during the year are adjusted for the effects of all dilutive potential equity shares.
(s) Cash and Cash equivalents
Cash and cash equivalents in the cash flow statement comprise cash at bank and in hand and short term investments with an originalmaturity of three months or less.
(t) Employee Stock Compensation Cost
Measurement and disclosure of the employee share-based payment plans is done in accordance with the Guidance Note onAccounting for Employee Share-based Payments, issued by the Institute of Chartered Accountants of India. The Parent Companymeasures compensation cost relating to employee stock options using the intrinsic value method. Compensation expense isamortized over the vesting period of the option on a straight line basis.
5. Segment Information
Business SegmentsThe PVR Group has organized its operations into two primary segments, Exhibition of Films and Distribution of Films, these havebeen identified taking into account the nature of activities carried out. The PVR Group’s operations predominantly relate to exhibitionof films. Other business segment i.e. distribution of films is very small and reported under others category.
Costs directly attributable to either segment are accounted for in the respective segment.
The following table presents the revenue and profit information of the business segments for the year ended March 31, 2007and March 31, 2006 and certain asset and liability information regarding business segments as at March 31, 2007and March 31, 2006.
Notes to the Consolidated accountsNotes to the Consolidated accounts
96 Rev
enue
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7M
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6M
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1,6
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4,5
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1,0
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0,8
89
31
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9,2
45
22
,21
2,5
65
(5
,12
9,2
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) (
3,3
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,55
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1,6
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4,5
10
1,0
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,06
6,9
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Inco
me
19
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7,0
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13
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3,5
02
45
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- -
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9,7
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5,1
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6,5
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) 1
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6,9
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,76
3 1
,06
2,3
20
,40
5
Res
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Segm
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46
,67
2,5
23
10
5,4
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1 6
,38
3,0
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(2
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5,1
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) -
- 1
53
,05
5,5
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10
2,9
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,22
7
Am
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f Go
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15
,61
6 3
13
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8
Inte
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Exp
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7,1
57
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f
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5,5
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15
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9,7
73
12
,32
9,0
35
Pro
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incl
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Weal
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Benefit
Tax
,
and D
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48
,54
0,5
50
34
,75
7,0
14
Net P
rofit
10
1,8
94
,94
6 5
2,8
29
,38
7
Oth
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info
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Segm
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s 2
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0,2
57
,47
0 1
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3,6
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5,8
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4 (
55
6,9
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50
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12
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3,8
52
2,8
98
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1,6
85
Segm
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35
2,5
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8,7
40
16
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4,8
60
13
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1,8
89
(5
56
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(5
56
,15
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36
8,5
27
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41
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4,4
77
Unal
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87
9,3
57
,05
8 7
30
,96
7,6
38
Tota
l Lia
bili
ties
1,2
47
,88
5,0
57
97
2,1
72
,11
5
Cap
ital E
xpen
ditu
re 6
26
,16
3,1
76
81
1,0
45
,56
8 2
0,6
37
,42
4 2
2,8
61
,15
4-
- 6
46
,80
0,6
00
83
3,9
06
,72
2
Depre
ciat
ion/A
mo
rtis
atio
n 1
24
,46
8,6
23
71
,03
0,9
36
8,9
10
,39
0 1
2,3
18
,85
6 -
- 1
33
,37
9,0
13
83
,34
9,7
92
Pro
visi
on fo
r D
oubtful D
ebts
2,2
78
,14
3 1
,60
2,3
81
- -
- -
2,2
78
,14
3 1
,60
2,3
81
Rs.
96 97
Notes to the Consolidated accounts
Geographical segments
The following is the distribution of the PVR Group Consolidated revenue by geographical markets, regardless of where the expenses against the same has been incurred.
March 31, 2007 March 31, 2006
Domestic Markets 1,662,607,560 1,036,757,628Overseas Markets 4,556,950 12,309,275
Total 1,667,164,510 1,049,066,903
The following table shows the carrying amount of debtors by geograhical marketDomestic Markets 71,960,846 44,111,810Overseas Markets 789,341 -
Total 72,750,187 44,111,810
The Group has common fixed assets for providing services to domestic as well as overseas markets. Hence, separate figures for fixed assets/additions to fixed assets have not been furnished.
Rev
enue
M
ovi
e e
xh
ibit
ion
Oth
ers
Elim
inat
ion
Tota
l
Fo
r th
e y
ear
For
the y
ear
Fo
r th
e y
ear
For
the y
ear
Fo
r th
e y
ear
For
the y
ear
Fo
r th
e y
ear
For
the y
ear
en
ded
ended
en
ded
ended
en
ded
ended
en
ded
ended
Bu
sin
ess
Segm
en
tM
arch
31
, 2
00
7M
arch
31
, 2
00
6M
arch
31
, 2
00
7M
arch
31
, 2
00
6M
arch
31
, 2
00
7M
arch
31
, 2
00
6M
arch
31
, 2
00
7M
arch
31
, 2
00
6
Inco
me f
rom
Op
era
tio
ns
1,6
40
,92
4,5
00
1,0
30
,16
0,8
89
31
,36
9,2
45
22
,21
2,5
65
(5
,12
9,2
35
) (
3,3
06
,55
1)
1,6
67
,16
4,5
10
1,0
49
,06
6,9
03
Oth
er
Inco
me
19
,28
7,0
03
13
,25
3,5
02
45
1,2
50
- -
- 1
9,7
38
,25
3 1
3,2
53
,50
2
Tota
l R
eve
nu
e 1
,66
0,2
11
,50
3 1
,04
3,4
14
,39
1 3
1,8
20
,49
5 2
2,2
12
,56
5 (
5,1
29
,23
5)
(3
,30
6,5
51
) 1
,68
6,9
02
,76
3 1
,06
2,3
20
,40
5
Res
ults
Segm
ent R
esul
ts 1
46
,67
2,5
23
10
5,4
03
,42
1 6
,38
3,0
36
(2
,41
5,1
94
) -
- 1
53
,05
5,5
59
10
2,9
88
,22
7
Am
ort
isat
ion o
f Go
odw
ill 3
15
,61
6 3
13
,78
8
Inte
rest
Exp
ense
43
,86
1,4
40
30
,73
7,1
57
Div
idend In
com
e/P
rofit
/Lo
ss o
n s
ale o
f
curr
ent i
nves
tmen
ts 2
6,4
57
,22
0 3
,35
5,5
90
Inte
rest
Inco
me
15
,09
9,7
73
12
,32
9,0
35
Pro
visi
on fo
r In
com
e T
ax (
incl
udin
g
Weal
th T
ax, F
ringe
Benefit
Tax
,
and D
efe
rred T
ax)
48
,54
0,5
50
34
,75
7,0
14
Net P
rofit
10
1,8
94
,94
6 5
2,8
29
,38
7
Oth
er
info
rmat
ion
Segm
ent A
sset
s 2
,65
0,2
57
,47
0 1
,90
3,6
12
,85
3 4
5,8
09
,44
6 3
6,4
04
,53
4 (
55
6,9
86
) (
55
6,1
52
) 2
,69
5,5
09
,93
0 1
,93
9,4
61
,23
5
Unal
loca
ted A
ssets
61
7,1
33
,92
2 9
59
,47
0,4
50
Tota
l Ass
ets
3,3
12
,64
3,8
52
2,8
98
,93
1,6
85
Segm
ent L
iabili
ties
35
2,5
00
,12
5 2
28
,69
8,7
40
16
,58
4,8
60
13
,06
1,8
89
(5
56
,98
6)
(5
56
,15
2)
36
8,5
27
,99
9 2
41
,20
4,4
77
Unal
loca
ted L
iabili
ties
87
9,3
57
,05
8 7
30
,96
7,6
38
Tota
l Lia
bili
ties
1,2
47
,88
5,0
57
97
2,1
72
,11
5
Cap
ital E
xpen
ditu
re 6
26
,16
3,1
76
81
1,0
45
,56
8 2
0,6
37
,42
4 2
2,8
61
,15
4-
- 6
46
,80
0,6
00
83
3,9
06
,72
2
Depre
ciat
ion/A
mo
rtis
atio
n 1
24
,46
8,6
23
71
,03
0,9
36
8,9
10
,39
0 1
2,3
18
,85
6 -
- 1
33
,37
9,0
13
83
,34
9,7
92
Pro
visi
on fo
r D
oubtful D
ebts
2,2
78
,14
3 1
,60
2,3
81
- -
- -
2,2
78
,14
3 1
,60
2,3
81
Rs.
98 6. R
ela
ted
Part
y D
isclo
sure
:
Ente
rpri
ses
hav
ing
contr
ol
Kay
Man
agem
ent
Rela
tive
s o
f kay
Ente
rpri
ses
ow
ned
or
Gra
nd
To
ral
or
sign
ifica
nt in
fluence
Per
sonnel
Man
agem
ent P
erso
nnel
sign
ifica
ntl
y in
fluence
do
ver
the P
arent C
om
pan
yb
y key
man
agem
ent
pers
onnel o
r th
eir
rela
tive
s3
1st
Mar
, 07
31
st M
ar, 0
63
1st
Mar
, 07
31
st M
ar, 0
63
1st
Mar
, 07
31
st M
ar, 0
63
1st
Mar
, 07
31
st M
ar, 0
63
1st
Mar
, 07
31
st M
ar, 0
6
Tran
sact
ions
duri
ng
the y
ear
Inte
rest
Rece
ived
PV
R F
acto
ry D
istr
ibutio
n N
etw
ork
Co
mp
ensa
tio
n r
ece
vied
to
war
ds
Co
mm
issi
on o
n F
ilms
--
- -
- -
- 2
15
,30
1 -
21
5,3
01
K S
era
Sera
Pro
duct
ion L
imite
d -
- -
- -
- 4
51
,25
0 -
45
1,2
50
-
Ren
t exp
ense
P
riya
Exh
ibito
rs P
riva
te L
imite
d 1
4,0
09
,29
5 1
1,0
39
,68
0 -
- -
- -
- 1
4,0
09
,29
5 1
1,0
39
,68
0
Leis
ure
Wo
rld L
imite
d-
- -
- -
- 1
4,8
52
,00
0 9
,44
4,0
00
14
,85
2,0
00
9,4
44
,00
0
Aja
y B
ijli
- -
3,4
56
,00
0 3
,45
6,0
00
- -
- -
3,4
56
,00
0 3
,45
6,0
00
Sa
nje
ev
Kum
ar -
- 1
,83
6,0
00
1,8
36
,00
0 -
- -
- 1
,83
6,0
00
1,8
36
,00
0
Rem
unera
tio
n p
aid
Aja
y B
ijli
- -
6,4
51
,20
0 6
,45
1,2
00
- -
- -
6,4
51
,20
0 6
,45
1,2
00
Sanje
ev
Kum
ar -
- 3
,42
7,2
00
3,4
27
,20
0 -
- -
- 3
,42
7,2
00
3,4
27
,20
0
Film
Dis
trib
uto
rs S
har
e e
xp
ense
(net
of r
eco
very
to
war
ds
pub
licit
y)P
VR
Fac
tory
Dis
trib
utio
n N
etw
ork
- -
- -
- -
- 7
63
,40
4 -
76
3,4
04
Fix
ed
Ass
ets
Purc
has
ed
Pri
ya E
xhib
itors
Pri
vate
Lim
ited
- 1
,80
0,0
00
- -
- -
- -
- 1
,80
0,0
00
Purc
has
e o
f shar
es
Aja
y B
ijli
- -
- 2
43
,00
0 -
- -
- -
24
3,0
00
Sanje
ev
Kum
ar -
- -
24
3,0
00
- -
- -
- 2
43
,00
0Sa
ndhura
o B
ijli
- -
- -
- 1
0,0
00
- -
- 1
0,0
00
Sele
na
Bijl
i -
- -
- -
1,0
00
- -
- 1
,00
0
Inte
rim
Div
idend
Pai
dfo
r 2
00
5-0
6B
ijli I
nve
stm
ents
Pri
vate
Lim
ited
4,9
20
,06
8 -
- -
- -
- -
4,9
20
,06
8 -
Pri
ya E
xhib
itors
Pri
vate
Lim
ited
4,3
30
,00
0 -
- -
- -
- -
4,3
30
,00
0 -
Aja
y B
ijli
- -
10
0 -
- -
- -
10
0 -
Sanje
ev
Kum
ar -
- 1
00
- -
- -
- 1
00
-Sa
ndhura
o B
ijli
- -
- -
10
0 -
- -
10
0 -
Sele
na
Bijl
i -
- -
- 1
00
- -
- 1
00
-
Inte
rim
Div
idend
Pai
dfo
r 2
00
6-0
7B
ijli I
nve
stm
ents
Pri
vate
Lim
ited
4,9
20
,76
8 -
- -
- -
- -
4,9
20
,76
8 -
Pri
ya E
xhib
itors
Pri
vate
Lim
ited
4,3
30
,00
0 -
- -
- -
- -
4,3
30
,00
0 -
Aja
y B
ijli
- -
18
,17
2 -
- -
- -
18
,17
2 -
Lo
an R
ep
aid
Ash
ok
Kum
ar R
uia
- -
1,3
65
,00
0 -
- -
- -
1,3
65
,00
0 -
The P
ho
enix
Mill
s Lim
ited
- -
- -
- -
1,0
10
,44
3 5
44
,12
4 1
,01
0,4
43
54
4,1
24
Lo
an R
eco
vere
dP
VR
Fac
tory
Dis
trib
utio
n N
etw
ork
- -
- -
- -
1,0
33
,42
6 -
1,0
33
,42
6 -
K S
era
Sera
Pro
duct
ion L
imite
d -
- -
- -
- 1
,00
0,0
00
- 1
,00
0,0
00
-
98 996. R
ela
ted
Part
y D
isclo
sure
:
Ente
rpri
ses
hav
ing
contr
ol
Kay
Man
agem
ent
Rela
tive
s o
f kay
Ente
rpri
ses
ow
ned
or
Gra
nd
To
ral
or
sign
ifica
nt in
fluence
Per
sonnel
Man
agem
ent P
erso
nnel
sign
ifica
ntl
y in
fluence
do
ver
the P
arent C
om
pan
yb
y key
man
agem
ent
pers
onnel o
r th
eir
rela
tive
s3
1st
Mar
, 07
31
st M
ar, 0
63
1st
Mar
, 07
31
st M
ar, 0
63
1st
Mar
, 07
31
st M
ar, 0
63
1st
Mar
, 07
31
st M
ar, 0
63
1st
Mar
, 07
31
st M
ar, 0
6
Tran
sact
ions
duri
ng
the y
ear
Inte
rest
Rece
ived
PV
R F
acto
ry D
istr
ibutio
n N
etw
ork
Co
mp
ensa
tio
n r
ece
vied
to
war
ds
Co
mm
issi
on o
n F
ilms
--
- -
- -
- 2
15
,30
1 -
21
5,3
01
K S
era
Sera
Pro
duct
ion L
imite
d -
- -
- -
- 4
51
,25
0 -
45
1,2
50
-
Ren
t exp
ense
P
riya
Exh
ibito
rs P
riva
te L
imite
d 1
4,0
09
,29
5 1
1,0
39
,68
0 -
- -
- -
- 1
4,0
09
,29
5 1
1,0
39
,68
0
Leis
ure
Wo
rld L
imite
d-
- -
- -
- 1
4,8
52
,00
0 9
,44
4,0
00
14
,85
2,0
00
9,4
44
,00
0
Aja
y B
ijli
- -
3,4
56
,00
0 3
,45
6,0
00
- -
- -
3,4
56
,00
0 3
,45
6,0
00
Sa
nje
ev
Kum
ar -
- 1
,83
6,0
00
1,8
36
,00
0 -
- -
- 1
,83
6,0
00
1,8
36
,00
0
Rem
unera
tio
n p
aid
Aja
y B
ijli
- -
6,4
51
,20
0 6
,45
1,2
00
- -
- -
6,4
51
,20
0 6
,45
1,2
00
Sanje
ev
Kum
ar -
- 3
,42
7,2
00
3,4
27
,20
0 -
- -
- 3
,42
7,2
00
3,4
27
,20
0
Film
Dis
trib
uto
rs S
har
e e
xp
ense
(net
of r
eco
very
to
war
ds
pub
licit
y)P
VR
Fac
tory
Dis
trib
utio
n N
etw
ork
- -
- -
- -
- 7
63
,40
4 -
76
3,4
04
Fix
ed
Ass
ets
Purc
has
ed
Pri
ya E
xhib
itors
Pri
vate
Lim
ited
- 1
,80
0,0
00
- -
- -
- -
- 1
,80
0,0
00
Purc
has
e o
f shar
es
Aja
y B
ijli
- -
- 2
43
,00
0 -
- -
- -
24
3,0
00
Sanje
ev
Kum
ar -
- -
24
3,0
00
- -
- -
- 2
43
,00
0Sa
ndhura
o B
ijli
- -
- -
- 1
0,0
00
- -
- 1
0,0
00
Sele
na
Bijl
i -
- -
- -
1,0
00
- -
- 1
,00
0
Inte
rim
Div
idend
Pai
dfo
r 2
00
5-0
6B
ijli I
nve
stm
ents
Pri
vate
Lim
ited
4,9
20
,06
8 -
- -
- -
- -
4,9
20
,06
8 -
Pri
ya E
xhib
itors
Pri
vate
Lim
ited
4,3
30
,00
0 -
- -
- -
- -
4,3
30
,00
0 -
Aja
y B
ijli
- -
10
0 -
- -
- -
10
0 -
Sanje
ev
Kum
ar -
- 1
00
- -
- -
- 1
00
-Sa
ndhura
o B
ijli
- -
- -
10
0 -
- -
10
0 -
Sele
na
Bijl
i -
- -
- 1
00
- -
- 1
00
-
Inte
rim
Div
idend
Pai
dfo
r 2
00
6-0
7B
ijli I
nve
stm
ents
Pri
vate
Lim
ited
4,9
20
,76
8 -
- -
- -
- -
4,9
20
,76
8 -
Pri
ya E
xhib
itors
Pri
vate
Lim
ited
4,3
30
,00
0 -
- -
- -
- -
4,3
30
,00
0 -
Aja
y B
ijli
- -
18
,17
2 -
- -
- -
18
,17
2 -
Lo
an R
ep
aid
Ash
ok
Kum
ar R
uia
- -
1,3
65
,00
0 -
- -
- -
1,3
65
,00
0 -
The P
ho
enix
Mill
s Lim
ited
- -
- -
- -
1,0
10
,44
3 5
44
,12
4 1
,01
0,4
43
54
4,1
24
Lo
an R
eco
vere
dP
VR
Fac
tory
Dis
trib
utio
n N
etw
ork
- -
- -
- -
1,0
33
,42
6 -
1,0
33
,42
6 -
K S
era
Sera
Pro
duct
ion L
imite
d -
- -
- -
- 1
,00
0,0
00
- 1
,00
0,0
00
-
6. R
ela
ted
Part
y D
isclo
sure
Contd
.
Ente
rpri
ses
hav
ing
contr
ol
Kay
Man
agem
ent
Rela
tive
s o
f kay
Ente
rpri
ses
ow
ned
or
Gra
nd
To
ral
or
sign
ifica
nt in
fluence
Per
sonnel
Man
agem
ent P
erso
nnel
sign
ifica
ntl
y in
fluence
do
ver
the P
arent C
om
pan
yb
y key
man
agem
ent
pers
onnel o
r th
eir
rela
tive
s3
1st
Mar
, 07
31
st M
ar, 0
63
1st
Mar
, 07
31
st M
ar, 0
63
1st
Mar
, 07
31
st M
ar, 0
63
1st
Mar
, 07
31
st M
ar, 0
63
1st
Mar
, 07
31
st M
ar, 0
6
Guar
ante
es T
aken
(Per
sonal
Guar
ante
es)
Aja
y B
ijli
- -
- *
- -
- -
- *
Sanje
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100
Key Management Personnel Ajay Bijli, Sanjeev Kumar, Ashok Kumar Ruia and Atul K Ruia, Ram Gopal Varma(till May 31, 2006).
Relatives of Key Management Personnel Sandhuro Rani Bijli and Selena Bijli
Enterprises having control or significant Bijli Investments Private Limitedinfluence over the Parent Company Priya Exhibitors Private Limited
Western India Trustee and Executor Company Limited (India Advantage Fund-1)(till December 27, 2005)
Enterprises owned or significantly influenced The Amritsar Transport Co. Private Limitedby key management personnel or their ATC Carriers Private Limitedrelatives Leisure World Limited
PVR Factory Distribution Network (till May 31, 2006)The Phoenix Mills LimitedR.R. Hosiery Private LimitedK Sera Sera Production Limited (till May 31, 2006)
NOTES:
a) * The Parent Company has availed loans from banks, a body corporate and Small Industries Development Bank of India (SIDBI) ofRs 494,989,524 (Previous year Rs. 613,304,554) which are further secured by personal guarantee of two directors of theParent Company. Loan from ICICI Bank Limited is further secured by mortgage of the personal properties of two directors of theParent Company located at Vasant Vihar and Kundli, New Delhi. Loan from SIDBI is further secured by second charge on personalproperties of a director of the Parent Company at Vasant Vihar and Jhandewalan, New Delhi.
b) The above particulars exclude expenses reimbursed to/by related parties.
c) No amount has been provided as doubtful debt or advance/written off or written back in the year in respect of debts due from/toabove related parties except as disclosed above.
7. The Parent Company has provided various share-based payment schemes to its employees. During the year ended March 31,2007, the following schemes were in operation:
Plan I Plan II Plan III
Date of grant October 10, 2005 October 10, 2005 October 10, 2005
Date of Board Approval September 8, 2005 September 8, 2005 September 8, 2005
Date of Shareholder’s approval September 15, 2005 September 15, 2005 September 15, 2005
Number of options granted 80,000 38,000 52,000
Fair value of Company’s share 75 75 77.50
Method of Settlement (Cash/Equity) Cash Cash Cash
Vesting Period 18 months 12 months 18 months
Exercise Period 3 months 3 months 3 month
Vesting Conditions Continued employment Continued employment Continued employment
The details of activity under different plans have been summarized below:
2006-07 2005-06Numberof Weighted Number of Weighted
Shares Average Exercise Shares Average ExercisePrice (Rs.) Price (Rs.)
Outstanding at the beginning of the year 170,000 28.41 Nil NilGranted during the year - - 170,000 28.41Forfeited during the year 33,500 28.21 - -Exercised during the year 136,500 28.46 - -Expired during the year - - -Outstanding at the end of the year - - 170,000 28.41Exercisable at the end of the year - - - -Weighted average remaining contractual Nil Nil 10.72 28.41life (in months)Weighted average fair value of options Nil Nil 170,000 75.76granted
The weighted average share price at the date of exercise for stock options was Rs. 189.67.
There are no stock options outstanding at the end of the year on March 31, 2007.
As at March 31, 2006
Range of Number of options Weighted average Weighted averageexercise prices outstanding remaining contractual exercise price
life of options(in months)
Rs. 20 to Rs. 47.50 170,000 10.72 28.41
Notes to the Consolidated accounts
100 101
Key Management Personnel Ajay Bijli, Sanjeev Kumar, Ashok Kumar Ruia and Atul K Ruia, Ram Gopal Varma(till May 31, 2006).
Relatives of Key Management Personnel Sandhuro Rani Bijli and Selena Bijli
Enterprises having control or significant Bijli Investments Private Limitedinfluence over the Parent Company Priya Exhibitors Private Limited
Western India Trustee and Executor Company Limited (India Advantage Fund-1)(till December 27, 2005)
Enterprises owned or significantly influenced The Amritsar Transport Co. Private Limitedby key management personnel or their ATC Carriers Private Limitedrelatives Leisure World Limited
PVR Factory Distribution Network (till May 31, 2006)The Phoenix Mills LimitedR.R. Hosiery Private LimitedK Sera Sera Production Limited (till May 31, 2006)
NOTES:
a) * The Parent Company has availed loans from banks, a body corporate and Small Industries Development Bank of India (SIDBI) ofRs 494,989,524 (Previous year Rs. 613,304,554) which are further secured by personal guarantee of two directors of theParent Company. Loan from ICICI Bank Limited is further secured by mortgage of the personal properties of two directors of theParent Company located at Vasant Vihar and Kundli, New Delhi. Loan from SIDBI is further secured by second charge on personalproperties of a director of the Parent Company at Vasant Vihar and Jhandewalan, New Delhi.
b) The above particulars exclude expenses reimbursed to/by related parties.
c) No amount has been provided as doubtful debt or advance/written off or written back in the year in respect of debts due from/toabove related parties except as disclosed above.
7. The Parent Company has provided various share-based payment schemes to its employees. During the year ended March 31,2007, the following schemes were in operation:
Plan I Plan II Plan III
Date of grant October 10, 2005 October 10, 2005 October 10, 2005
Date of Board Approval September 8, 2005 September 8, 2005 September 8, 2005
Date of Shareholder’s approval September 15, 2005 September 15, 2005 September 15, 2005
Number of options granted 80,000 38,000 52,000
Fair value of Company’s share 75 75 77.50
Method of Settlement (Cash/Equity) Cash Cash Cash
Vesting Period 18 months 12 months 18 months
Exercise Period 3 months 3 months 3 month
Vesting Conditions Continued employment Continued employment Continued employment
The details of activity under different plans have been summarized below:
2006-07 2005-06Numberof Weighted Number of Weighted
Shares Average Exercise Shares Average ExercisePrice (Rs.) Price (Rs.)
Outstanding at the beginning of the year 170,000 28.41 Nil NilGranted during the year - - 170,000 28.41Forfeited during the year 33,500 28.21 - -Exercised during the year 136,500 28.46 - -Expired during the year - - -Outstanding at the end of the year - - 170,000 28.41Exercisable at the end of the year - - - -Weighted average remaining contractual Nil Nil 10.72 28.41life (in months)Weighted average fair value of options Nil Nil 170,000 75.76granted
The weighted average share price at the date of exercise for stock options was Rs. 189.67.
There are no stock options outstanding at the end of the year on March 31, 2007.
As at March 31, 2006
Range of Number of options Weighted average Weighted averageexercise prices outstanding remaining contractual exercise price
life of options(in months)
Rs. 20 to Rs. 47.50 170,000 10.72 28.41
Stock Options granted
The Parent Company has not granted any stock options during the year ended March 31, 2007.
2006-07 2005-06
Exercise Price 28.46 -Expected Volatility 8.61% -Historical Volatility - -Life of the options granted (Vesting and exercise period) in months 19.12 -Expected dividends 68,250 -Average risk-free interest rate 5.50% -
Expected dividend rate 5.00%
The expected volatility was determined based on management estimates as there was no historical volatility data available.
Effect of the employee share-based payment plans on the Profit and Loss Account and Pre-Operative Expenditure and on its financialposition:
2006-07 2005-06* Total
Liability for employee stock options outstanding 2,915,965 - 2,915,965at the beginning of the yearTotal Employee Compensation Cost pertaining to share-based 4,502,428 2,553,183 7,055,611payment plans debited to Profit and Loss AccountLess: Amount reversed upon forfeiture of options (1,592,500) - (1,592,500)Net Impact in the Profit and Loss Account 2,909,928 2,553,183 5,463,111Add: Pre-Operative Expenditure (ESOP) 631,607 362,782 994,389Liability for employee stock options outstanding as at year end - 2,915,965 2,915,965Amount transferred to Securities Premium Account upon 6,457,500 - 6,457,500exercise of granted options
* Amount debited to Profit and Loss Account and Pre-Operative Expenditure during the previous year further includes amount ofRs. 4,455,000 and Rs. 345,000 respectively 80,000 equity shares issued to the certain employees under Employee Share PurchaseScheme approved in the previous year.
8. The Parent Company has till date, incurred/made expenses/payments on a multi-screen project at Goregaon, Mumbai such asPre-Operative Expenditure (including architect fee, traveling expenses, interest on loan taken etc.), payment of Capital Advances toa supplier, and Security Deposit to developers etc. of Rs. 8,290,632, Rs. 710,000 and Rs. 26,660,340 respectively on behalf of aproposed subsidiary i.e. Sunrise Infotainment Private Limited. The Parent Company intends to recover these expenses/payments asand when the final decision is taken. Pending final decision, the aforesaid amount has been shown under respective heads in theconsolidated accounts.
9. Security Deposits (paid) include Rs. 10,332,089 recoverable from three parties, with whom the Parent Company had entered intoMemorandum of Understanding for taking multiplex/office space on rent. The Parent Company has filed legal case for recovery ofdeposit of Rs. 2,832,089 in case of one party. The Parent Company is in discussions with the parties for the recovery of theaforesaid amount and is hopeful of recovering the same. Hence, no provision against the same has been considered necessary.
10.1 During the previous year, the Parent Company had successfully completed its public issue. This comprised of 5,700,000 equity sharesof Rs. 10 each at a premium of Rs. 215 per share. Alongwith this public issue, there was also a sale of 2,000,000 equity shares bya shareholder of the Parent Company i.e. Western India Trustee and Executor Company Limited (India Advantage Fund-I).
10.2 Utilization of IPO funds:
As per ProspectusObjects Total Estimated Amount to be Amount Spent Balance to be
Project Cost spent till till March 31, spentMarch 31, 2007 2007
Setting up of New Cinemas 1,380,000,000 1,343,000,000 481,385,767 898,614,233
Equity Investment/ UnsecuredLoan in CR Retail Malls (India) Pvt. Ltd.,a wholly owned subsidiaryfor setting up a Multiplex 300,000,000 300,000,000 300,000,000 -
Equity Investment/ UnsecuredLoan in PVR Pictures Ltd,a wholly owned subsidiaryfor Film Distribution Business 70,000,000 70,000,000 11,500,000 58,500,000
Unsecured Loan inPVR Pictures Ltd, a whollyowned subsidiary forFilm Production Business 200,000,000 - 106,500,000 93,500,000
General Corporate Expenses* 62,000,000 62,000,000 71,833,661 -
Issue Expenses* 120,000,000 120,000,000 110,166,339 -
Prepayment of high cost loans** Nil Nil 108,086,341 (108,086,341)
Total 2,132,000,000*** 1,895,000,000 1,189,472,108 942,527,892
Notes to the Consolidated accountsNotes to the Consolidated accounts
Amount in Rs.
102
NOTES:i) Unspent money is temporarily invested in the units of Mutual Funds.ii) * The Board of Directors of the Parent Company have approved the inter-se re-allocation of unspent monies amounting to Rs.
9,833,661 from issue expenses to general corporate expenses.iii) ** The Parent Company had temporarily during the last year, used part of proceeds of share issue of Rs. 108,086,341 to prepay
the high cost loans, which would be replaced by borrowing new additional loan(s) in future.iv) *** includes Rs. 1,282,500,000 raised through public issue of equity shares.v) Certain expenditure on setting up of new cinemas and equity investment in a subsidiary company have been deferred to the year
2007-08, due to which current year’s expenditure were lower.
11. Derivative Instruments and Unhedged Foreign Currency Exposure :
Particulars of Unhedged Foreign Currency Exposure as at the Consolidated Balance Sheet date:
Amount in Respective currencyParticulars Currency March 31, 2007 March 31, 2006
Sundry Creditors USD Nil 28,670GBP Nil 7,974
Income received in advanced USD 66,650 43,987Capital Advances USD 40,608 587,054
EURO Nil 18,897Debtors USD 17,541 Nil
12. Gratuity and leave benefit plans: (AS 15 Revised)
The Parent Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service gets agratuity on departure at 15 days salary (last drawn salary) for each completed year of service. The scheme is funded with aninsurance company in the form of a qualifying insurance policy.
The Parent Company also provides 18-24 earned leaves to employees every year to be accumulated upto a maximum level of54-48 leaves respectively. These benefits are unfunded.
The following tables summarize the components of net benefit expense recognized in the profit and loss account and the fundedstatus and amounts recognized in the balance sheet for the respective plans.
Profit and Loss AccountNet employee benefit expense (recognized in Employee Cost)
Leave Encashment Gratuity
2006-07 2006-07
Current service cost 1,773,360 1,439,748Interest cost on benefit obligation 223,633 420,146Expected return on plan assets - (364,795)Net actuarial loss recognized in the year on account of return on plan assets - 48,676Net actuarial loss recognised in the year 755,805 2,228,027Net benefit expense 2,752,798 3,771,802
Actual return on plan assets - (316,119)
Balance sheetDetails of Provision for leave encashment benefits and gratuity
Leave Encashment Gratuity
2006-07 2006-07
Defined benefit obligation 4,799,565 8,917,260
Total value of Provident fund contribution on closing liability 575,948 -
Fair value of plan assets - 5,069,993
5,375,513 3,847,267
Less: Unrecognised past service cost - -
Plan (liability) (5,375,513) (3,847,267)
Notes to the Consolidated accounts
102 103
NOTES:i) Unspent money is temporarily invested in the units of Mutual Funds.ii) * The Board of Directors of the Parent Company have approved the inter-se re-allocation of unspent monies amounting to Rs.
9,833,661 from issue expenses to general corporate expenses.iii) ** The Parent Company had temporarily during the last year, used part of proceeds of share issue of Rs. 108,086,341 to prepay
the high cost loans, which would be replaced by borrowing new additional loan(s) in future.iv) *** includes Rs. 1,282,500,000 raised through public issue of equity shares.v) Certain expenditure on setting up of new cinemas and equity investment in a subsidiary company have been deferred to the year
2007-08, due to which current year’s expenditure were lower.
11. Derivative Instruments and Unhedged Foreign Currency Exposure :
Particulars of Unhedged Foreign Currency Exposure as at the Consolidated Balance Sheet date:
Amount in Respective currencyParticulars Currency March 31, 2007 March 31, 2006
Sundry Creditors USD Nil 28,670GBP Nil 7,974
Income received in advanced USD 66,650 43,987Capital Advances USD 40,608 587,054
EURO Nil 18,897Debtors USD 17,541 Nil
12. Gratuity and leave benefit plans: (AS 15 Revised)
The Parent Company has a defined benefit gratuity plan. Every employee who has completed five years or more of service gets agratuity on departure at 15 days salary (last drawn salary) for each completed year of service. The scheme is funded with aninsurance company in the form of a qualifying insurance policy.
The Parent Company also provides 18-24 earned leaves to employees every year to be accumulated upto a maximum level of54-48 leaves respectively. These benefits are unfunded.
The following tables summarize the components of net benefit expense recognized in the profit and loss account and the fundedstatus and amounts recognized in the balance sheet for the respective plans.
Profit and Loss AccountNet employee benefit expense (recognized in Employee Cost)
Leave Encashment Gratuity
2006-07 2006-07
Current service cost 1,773,360 1,439,748Interest cost on benefit obligation 223,633 420,146Expected return on plan assets - (364,795)Net actuarial loss recognized in the year on account of return on plan assets - 48,676Net actuarial loss recognised in the year 755,805 2,228,027Net benefit expense 2,752,798 3,771,802
Actual return on plan assets - (316,119)
Balance sheetDetails of Provision for leave encashment benefits and gratuity
Leave Encashment Gratuity
2006-07 2006-07
Defined benefit obligation 4,799,565 8,917,260
Total value of Provident fund contribution on closing liability 575,948 -
Fair value of plan assets - 5,069,993
5,375,513 3,847,267
Less: Unrecognised past service cost - -
Plan (liability) (5,375,513) (3,847,267)
Changes in the present value of the defined benefit obligation are as follows:
Leave Encashment Gratuity
2006-07 2006-07
Opening defined benefit obligation 3,249,265 6,184,201Interest cost 223,633 420,146Current service cost 1,773,360 1,439,748Actual return on plan assets - 316,119Benefits paid (1,202,498) (1,038,743)Actuarial losses on obligation 755,805 2,228,027
Closing defined benefit obligation 4,799,565 8,917,260
Changes in the fair value of plan assets are as follows:
Gratuity
2006-07
Opening fair value of plan assets 4,891,561Expected return 364,795Contributions by employer 901,056Benefits paid (1,038,743)Actuarial (losses) (48,676)
Closing fair value of plan assets 5,069,993
The Parent Company has since contributed Rs. 3,771,802 to the gratuity fund.
The major categories of plan assets as a percentage of the fair value of total plan assets are as follows:
Gratuity
2006-07
%Investments with insurer 80.14Cash and bank balance with the insurer 19.86
The overall expected rate of return on assets is determined based on the market prices prevailing on that date, applicable to theperiod over which the obligation is to be settled. There has been significant change in expected rate of return on assets due to theimproved debt market scenario.
The principal assumptions used in determining gratuity and leave encashment obligations for the Parent Company’s plans areshown below:
Leave Encashment Gratuity
2006-07 2006-07
% %
Discount rate 7.75 7.75Expected rate of return on plan assets - 7.50Increase in compensation cost 5.50 5.50Employee turnoverupto 30 years 25 25above 30 years but upto 44 years 15 15above 44 years 10 10
The estimates of future salary increases, considered in actuarial valuation, take account of inflation, seniority, promotion and otherrelevant factors, such as supply and demand in the employment market.
Amounts for the current and previous four periods are as follows:
Leave Gratuity
2006-07 2006-07
Defined benefit obligation 4,799,565 8,917,260Plan assets - 5,069,993Deficit 4,799,565 3,847,267
Notes to the Consolidated accountsNotes to the Consolidated accounts
104
Experience adjustments on plan liabilities - -Experience adjustments on plan assets - -
NOTE:The actuarial valuation of gratuity and leave encashment liability in the previous year was done in accordance with the pre-revisedAccounting Standard, AS-15 – Employee Benefits. Accordingly, comparative numbers of previous years have not been furnished.
Defined Contribution Plan:
2006-07 2005-06
Contribution to Provident Fund - -
Charged to Profit and Loss Account 12,231,350 7,722,459
Charged to Pre-operative expenses 803,990 901,862
The PVR Group expects to contribute Rs. 5,000,000 to gratuity fund in the year 2007-08.
13. Leases
i) Rental expenses in respect of operating leases are recognized as an expense in the Profit and Loss Account and Pre-OperativeExpenditure (pending allocation), as the case may be, on a straight line basis over the lease term.
Operating Lease (for assets taken on lease)
a) The PVR Group has taken various cinemas, multiplexes, offices and godown premises under operating lease agreements. Theseare generally cancelable at the option of the Company.
b) Lease payments for the year are Rs. 189,204,176 (Previous year Rs. 154,776,425).
ii) Rental income in respect of operating leases are recognized as an income in the Profit and Loss Account and netted off from rentexpense, as the case may be, on a straight line basis over the lease term.
Operating Lease (for assets given on lease)
a) The Company has given various spaces under operating lease agreements. These are generally cancelable at the option of theCompany.
b) Rental Income for the year are Rs. 19,829,701 (Previous year Rs. 14,074,573).
March 31, 2007 March 31, 2007(Rs.) (Rs.)
14. Capital CommitmentsEstimated amount of contracts remaining to be executed on capital account 150,947,882 359,076,048and not provided for.
15. Contingent Liabilities (not provided for) in respect of:
a) Labour cases pending Amount not Amount not ascertainable ascertainable
b) Claims against the PVR Group not acknowledged as debts 2,961,730 1,290,311(including Rs. 2,961,730, Previous Year Rs. 854,057 paid underprotest which is appearing in the schedule of Loans and Advances)*
*In view of the large number of cases pending at various forums/courts, it is not practicable to furnish the details of each case.*Based on the discussions with the solicitors/meeting the terms and conditions by the PVR Group , the management believes that thePVR Group has a strong chance of success in the cases and hence no provision there-against is considered necessary.
16. Supplementary Statutory Information
16.1 Managing Directors’ Remuneration (of Parent Company)*Salary 5,760,000 5,760,000Contribution to Provident fund 691,200 691,200Perquisites 3,456,000 3,456,000
TOTAL 9,907,200 9,907,200
16.2 Executive Director’s Remuneration (of Parent Company)*Salary 3,060,000 3,060,000Contribution to Provident fund 367,200 367,200Perquisites 1,836,000 1,836,000
TOTAL 5,263,200 5,263,200
*excluding gratuity and leave encashment expenses since they are not eligible for the same.
Notes to the Consolidated accounts
104 105
Experience adjustments on plan liabilities - -Experience adjustments on plan assets - -
NOTE:The actuarial valuation of gratuity and leave encashment liability in the previous year was done in accordance with the pre-revisedAccounting Standard, AS-15 – Employee Benefits. Accordingly, comparative numbers of previous years have not been furnished.
Defined Contribution Plan:
2006-07 2005-06
Contribution to Provident Fund - -
Charged to Profit and Loss Account 12,231,350 7,722,459
Charged to Pre-operative expenses 803,990 901,862
The PVR Group expects to contribute Rs. 5,000,000 to gratuity fund in the year 2007-08.
13. Leases
i) Rental expenses in respect of operating leases are recognized as an expense in the Profit and Loss Account and Pre-OperativeExpenditure (pending allocation), as the case may be, on a straight line basis over the lease term.
Operating Lease (for assets taken on lease)
a) The PVR Group has taken various cinemas, multiplexes, offices and godown premises under operating lease agreements. Theseare generally cancelable at the option of the Company.
b) Lease payments for the year are Rs. 189,204,176 (Previous year Rs. 154,776,425).
ii) Rental income in respect of operating leases are recognized as an income in the Profit and Loss Account and netted off from rentexpense, as the case may be, on a straight line basis over the lease term.
Operating Lease (for assets given on lease)
a) The Company has given various spaces under operating lease agreements. These are generally cancelable at the option of theCompany.
b) Rental Income for the year are Rs. 19,829,701 (Previous year Rs. 14,074,573).
March 31, 2007 March 31, 2007(Rs.) (Rs.)
14. Capital CommitmentsEstimated amount of contracts remaining to be executed on capital account 150,947,882 359,076,048and not provided for.
15. Contingent Liabilities (not provided for) in respect of:
a) Labour cases pending Amount not Amount not ascertainable ascertainable
b) Claims against the PVR Group not acknowledged as debts 2,961,730 1,290,311(including Rs. 2,961,730, Previous Year Rs. 854,057 paid underprotest which is appearing in the schedule of Loans and Advances)*
*In view of the large number of cases pending at various forums/courts, it is not practicable to furnish the details of each case.*Based on the discussions with the solicitors/meeting the terms and conditions by the PVR Group , the management believes that thePVR Group has a strong chance of success in the cases and hence no provision there-against is considered necessary.
16. Supplementary Statutory Information
16.1 Managing Directors’ Remuneration (of Parent Company)*Salary 5,760,000 5,760,000Contribution to Provident fund 691,200 691,200Perquisites 3,456,000 3,456,000
TOTAL 9,907,200 9,907,200
16.2 Executive Director’s Remuneration (of Parent Company)*Salary 3,060,000 3,060,000Contribution to Provident fund 367,200 367,200Perquisites 1,836,000 1,836,000
TOTAL 5,263,200 5,263,200
*excluding gratuity and leave encashment expenses since they are not eligible for the same.
Notes to the Consolidated accountsNotes to the Consolidated accounts
17. Previous Year Comparatives
(a) The Parent Company has during the year started commercial operations at Juhu Mumbai, Indore, Lucknow, Mullund Mumbai,Sahara Gurgaon, Aurangabad, Latur and Aligarh. Consolidated financial statements include one subsidiary having interest in a jointventure partnership firm, namely PVR Factory Distribution Network. The said partnership firm was dissolved on May 31, 2006,whereas pervious year figures included for the period of twelve months accounts. Hence, current year’s figures are not strictlycomparable with those of previous year.
(b) Previous year’s figures have been regrouped where necessary to conform to current year’s classification.
Signatures to Schedule 1 to 25
As per our report of even date
For S. R. Batliboi & Co. FOR AND ON BEHALF OF THE BOARD OF DIRECTORSChartered Accountants
Ajay Bijli Sanjeev Kumar N. C. GuptaChairman cum Managing Director Joint Managing Director Company Secretary
per Anil Gupta Sumit Chandwani Renaud Jean Palliere Neeraj PrakashPartner Director Director Chief of Accounts
Membership No 87921
Place : New DelhiDate : June 6, 2007
106
(Rs.)
Name of the Subsidiary
SI. No. PVR Pictures Limited CR Retail Malls (India) Pvt.Ltd.
2006-2007 2005-2006 2006-2007 2005-2006
1 Capital 15,000,000 15,000,000 200,000,000 7,100,000
2 Reserves and surplus 1,015,073 (1,890,319) (1,729,768) (776,157)
3 Total Assets 134,073,498 24,609,680 541,300,233 219,478,843
(Fixed Assets + Current
Assets)
4 Total Liabilities 118,058,426 11,500,000 350,030,000 220,155,000
5 Investments - 7,000,000 7,000,000
(except in case of investment
in subsidiary company)
6 Turnover 34,887,253 21,569,983 647,350 598,511
7 Profit before tax 4,354,566 (2,699,130) (744,391) 523,918
8 Provision for tax 1,449,174 (767,168) 209,220 180,000
9 Profit after tax 2,905,392 (1,931,962) (953,611) 343,918
10 Proposed Dividend - - - -
Statements of Subsidiaries of Subsidiaries of Subsidiaries of Subsidiaries of Subsidiaries forforforforforthe Financial Ythe Financial Ythe Financial Ythe Financial Ythe Financial Year Ended 31.03.07ear Ended 31.03.07ear Ended 31.03.07ear Ended 31.03.07ear Ended 31.03.07
Summarised Financial
106
(Rs.)
Name of the Subsidiary
SI. No. PVR Pictures Limited CR Retail Malls (India) Pvt.Ltd.
2006-2007 2005-2006 2006-2007 2005-2006
1 Capital 15,000,000 15,000,000 200,000,000 7,100,000
2 Reserves and surplus 1,015,073 (1,890,319) (1,729,768) (776,157)
3 Total Assets 134,073,498 24,609,680 541,300,233 219,478,843
(Fixed Assets + Current
Assets)
4 Total Liabilities 118,058,426 11,500,000 350,030,000 220,155,000
5 Investments - 7,000,000 7,000,000
(except in case of investment
in subsidiary company)
6 Turnover 34,887,253 21,569,983 647,350 598,511
7 Profit before tax 4,354,566 (2,699,130) (744,391) 523,918
8 Provision for tax 1,449,174 (767,168) 209,220 180,000
9 Profit after tax 2,905,392 (1,931,962) (953,611) 343,918
10 Proposed Dividend - - - -
Statements of Subsidiaries of Subsidiaries of Subsidiaries of Subsidiaries of Subsidiaries forforforforforthe Financial Ythe Financial Ythe Financial Ythe Financial Ythe Financial Year Ended 31.03.07ear Ended 31.03.07ear Ended 31.03.07ear Ended 31.03.07ear Ended 31.03.07
PVR LIMITED
Registered Office: 61, Basant Lok, Vasant Vihar, New Delhi - 110057
(To be handed over at the Attendance Counter)
Folio No. DP ID No.
No. of Shares Client ID No.
I/We record my/our presence at the 12th Annual General Meeting of the Company at 61, Basant Lok, Vasant Vihar, New Delhi
- 110057 on Saturday, 18th August, 2007.
1. Name of the Member : 1. Mr./Mrs./Miss ____________________________________________
and Joint Holder (s) 2. Mr./Mrs./Miss ____________________________________________
(in block letters) 3. Mr./Mrs./Miss ____________________________________________
2. Address : _________________________________________________________
_________________________________________________________
_________________________________________________________
3. Name of Proxy : Mr./Mrs./Miss ______________________________________________
_________________
Signature of the Proxy Signature(s) of Member and Joint Holder(s)
PVR LIMITED
Registered Office: 61, Basant Lok, Vasant Vihar, New Delhi - 110057
Folio No. DP ID No.
No. of Shares Client ID No.
I/We R/o
being a Member/Members of PVR Limited hereby
appoint Mr./Mrs./Miss R/o
failing him/her Mr./Mrs./Miss
R/o whose specimen
signatures are given hereunder, to vote for me/us and on my/our behalf at the 12th Annual General Meeting of the
Company to be held on Saturday, 18th August, 2007 at 10.30 A.M and at any adjournment thereof.
1.
2.
___________________________
Specimen signature of the Proxy(ies Signature of member
Signed at this ___________ day of _____________ 2007.
NOTE: The proxy must be returned so as to reach the registered office of the Company not less than 48 hours (i.e. latest by 10.30
A.M on 16th August, 2007) before the time for holding the aforesaid meeting. The proxy need not be a member of the Company.
Attendance Slip
Proxy Form○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○
Revenue
Stamp
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Summarised Financial
