KSK Title Deluxe Kala 14V-1

Contents

HIGHLIGHTS Chairman’s Statement 2 Operational and Financial Highlights 3

GOVERNANCE Directors’ Report 6 Management Discussion and Analysis 13 Report on Corporate Governance 30

FINANCIAL STANDALONE FINANCIALS STATEMENTS Auditors’ Report 42 Balance Sheet 45 Profit and Loss Account 46 Cash Flow Statement 47 Schedules 49

1 CONSOLIDATED FINANCIALS Consolidated Auditors’ Report 71 Consolidated Balance Sheet 72 Consolidated Profit and Loss Account 73 Consolidated Cash Flow Statement 74 Schedules to Consolidated Accounts 76

Notice 107 Corporate Information 112

1 Chairman’s Statement Highlights 2010-11 Operational Company anticipates to commission these two units Ý Operating capacity increased to 933 MW. Projects aggregating 3720 MW Operating Capacity during the second half of 2012 and the balance units under construction thereafter through 2013 and 2014. We believe upon Ý Construction progress underway at 3600 MW KSK Mahanadi project, with 933 MW successful completion, this will be one of the largest single boiler drum lifting completed for two units location green field projects in India and reinforce the Ý KSK Dibbin received in principle Environment Clearance and land Under Construction acquisition activity to be completed shortly strong project development capabilities of KSK. Ý Stage - 1 Environment Clearance (forest) obtained for Gare-Pelma mine 3720 MW While the Company continues its dedicated focus on the development and progress on permits and land acquisition underway construction and setup of the main power plant, the parent Ý More than 6 GW of development opportunities with progress on Development Opportunities and its group companies are supplementing the same development on 1.98 GW thermal project in Orissa through the development of necessary ancillary Ý Progress on detailed project report on hydro projects in Arunachal 6 GW Pradesh infrastructure that supports the large power project being developed by KSK. We believe this synergy would enable an immediate synchronized development approach on Dear Shareholders Financial ground and also provides the Company necessary Figures in INR million, unless otherwise stated Amidst various challenges faced by the power generation flexibility to consolidate the power plant with the ancillary 10,164 companies during recent quarters and the power sector as infrastructure at a later stage based on internal accruals. a whole in India, I am pleased to report that KSK Group has We believe that economic empowerment of our continued its asset setup progress and now crossed 900 communities alone can help us ensure sustainability of the MW of aggregate generation capacity on ground. As a development that we undertake. At KSK, sustainability result of Company's continuous focus on optimizing initiatives are an integral part of the corporate strategy and generation from earlier operational power plants and with we contribute to the community by carrying our business in addition of new generation capacities from VS Lignite and such a way that ensures overall socio economic Wardha, the generation stood at 2,793 million units as development of the areas in which we setup or operate. against 1,001 million units during the previous year. 260% 10,164 2,793 Despite certain sectoral challenges and project specific KSK has registered an impressive growth in operational Sale of Energy issues such as fuel supplies that are being addressed, it is capacity while simultaneously experiencing pressures and our belief that the Company is well positioned to catapult volatilities with respect to fuel supplies, government itself, in the next few years, to be the single largest policies and tariff realization. It is our belief that, while these independent private power producer with an established 55% 5,712 developments could last for few quarters, this is only a operating track record, strong technical, financial and EBITDA temporary passing phase as the company has marshalled 2,827 commercial capabilities. A great deal of dedication and multiple efforts and strategies to deal and further commitment has been shown by operating team which * strengthen the fuel security issues in the fast changing 2,452 enabled us to meet our growth objectives. I would like to environment and emerge as one of the more stable and 19% 2,280 4.09 take this opportunity to acknowledge their important 1,001 stronger player in the Indian power generation landscape. contributions. Profit After Tax * Also, the Company's effort to the alternative coal linkages 3.89 T has begun and we expect this to provide necessary With the best yet to come, I would conclude that there are 958 N

E impetus to margin improvements. exciting and challenging times ahead of us and thank all 3.54* M

E the partners of our growth and shareholders for their

T Further on the construction side, significant progress has

A continual support. T been made with respect to the 3600 MW KSK Mahanadi S 33% 88,475 S

Power Project at Nariyara, Chhattisgarh with boiler drum S ’ T N Net Fixed Assets & CWIP

lifting for two units having been achieved in recent months H A Mn-Kwh Mn-Kwh Mn-Kwh G M and hydro test targeted to be completed for both the units I Sale of Energy Sale of Energy Sale of Energy R L Units Generated Units Generated Units Generated I H

A before end of the current financial year. With continual G H

T.L. Sankar I C progress in the construction activity at this project site, the * Average tariff in INR/kWh 2008-09 2009-10 2010-11 H Chairman

2 Annual Report 2010-11 | KSK Energy Ventures Limited KSK Energy Ventures Limited | Annual Report 2010-11 3 Chairman’s Statement Highlights 2010-11 Operational Company anticipates to commission these two units Ý Operating capacity increased to 933 MW. Projects aggregating 3720 MW Operating Capacity during the second half of 2012 and the balance units under construction thereafter through 2013 and 2014. We believe upon Ý Construction progress underway at 3600 MW KSK Mahanadi project, with 933 MW successful completion, this will be one of the largest single boiler drum lifting completed for two units location green field projects in India and reinforce the Ý KSK Dibbin received in principle Environment Clearance and land Under Construction acquisition activity to be completed shortly strong project development capabilities of KSK. Ý Stage - 1 Environment Clearance (forest) obtained for Gare-Pelma mine 3720 MW While the Company continues its dedicated focus on the development and progress on permits and land acquisition underway construction and setup of the main power plant, the parent Ý More than 6 GW of development opportunities with progress on Development Opportunities and its group companies are supplementing the same development on 1.98 GW thermal project in Orissa through the development of necessary ancillary Ý Progress on detailed project report on hydro projects in Arunachal 6 GW Pradesh infrastructure that supports the large power project being developed by KSK. We believe this synergy would enable an immediate synchronized development approach on Dear Shareholders Financial ground and also provides the Company necessary Figures in INR million, unless otherwise stated Amidst various challenges faced by the power generation flexibility to consolidate the power plant with the ancillary 10,164 companies during recent quarters and the power sector as infrastructure at a later stage based on internal accruals. a whole in India, I am pleased to report that KSK Group has We believe that economic empowerment of our continued its asset setup progress and now crossed 900 communities alone can help us ensure sustainability of the MW of aggregate generation capacity on ground. As a development that we undertake. At KSK, sustainability result of Company's continuous focus on optimizing initiatives are an integral part of the corporate strategy and generation from earlier operational power plants and with we contribute to the community by carrying our business in addition of new generation capacities from VS Lignite and such a way that ensures overall socio economic Wardha, the generation stood at 2,793 million units as development of the areas in which we setup or operate. against 1,001 million units during the previous year. 260% 10,164 2,793 Despite certain sectoral challenges and project specific KSK has registered an impressive growth in operational Sale of Energy issues such as fuel supplies that are being addressed, it is capacity while simultaneously experiencing pressures and our belief that the Company is well positioned to catapult volatilities with respect to fuel supplies, government itself, in the next few years, to be the single largest policies and tariff realization. It is our belief that, while these independent private power producer with an established 55% 5,712 developments could last for few quarters, this is only a operating track record, strong technical, financial and EBITDA temporary passing phase as the company has marshalled 2,827 commercial capabilities. A great deal of dedication and multiple efforts and strategies to deal and further commitment has been shown by operating team which * strengthen the fuel security issues in the fast changing 2,452 enabled us to meet our growth objectives. I would like to environment and emerge as one of the more stable and 19% 2,280 4.09 take this opportunity to acknowledge their important 1,001 stronger player in the Indian power generation landscape. contributions. Profit After Tax * Also, the Company's effort to the alternative coal linkages 3.89 T has begun and we expect this to provide necessary With the best yet to come, I would conclude that there are 958 N

E impetus to margin improvements. exciting and challenging times ahead of us and thank all 3.54* M

E the partners of our growth and shareholders for their

T Further on the construction side, significant progress has

A continual support. T been made with respect to the 3600 MW KSK Mahanadi S 33% 88,475 S

Power Project at Nariyara, Chhattisgarh with boiler drum S ’ T N Net Fixed Assets & CWIP lifting for two units having been achieved in recent months H A Mn-Kwh Mn-Kwh Mn-Kwh G M and hydro test targeted to be completed for both the units I Sale of Energy Sale of Energy Sale of Energy R L Units Generated Units Generated Units Generated I H

A before end of the current financial year. With continual G H

T.L. Sankar I C progress in the construction activity at this project site, the * Average tariff in INR/kWh 2008-09 2009-10 2010-11 H Chairman

2 Annual Report 2010-11 | KSK Energy Ventures Limited KSK Energy Ventures Limited | Annual Report 2010-11 3 1 Sitapuram Power, Andhra Pradesh 5 VS Lignite Power, Rajasthan 7 Wardha Power, Maharashtra

2 Sai Regency Power, Tamilnadu Our Presence

3 Arasmeta Captive Power, Chhattisgarh

6 3 7

1 Power Plants in Operation - 933 MW Power Plants under Construction - 3720 MW Power Plants under Planning - 6000+ MW 2 8

4 KSK Dibbin Hydro Power, Arunachal Pradesh 6 KSK Mahanadi Power, Chhattisgarh 8 KSK Wind Energy, Tamilnadu 1 Sitapuram Power, Andhra Pradesh 5 VS Lignite Power, Rajasthan 7 Wardha Power, Maharashtra

2 Sai Regency Power, Tamilnadu Our Presence

3 Arasmeta Captive Power, Chhattisgarh

6 3 7

1 Power Plants in Operation - 933 MW Power Plants under Construction - 3720 MW Power Plants under Planning - 6000+ MW 2 8

4 KSK Dibbin Hydro Power, Arunachal Pradesh 6 KSK Mahanadi Power, Chhattisgarh 8 KSK Wind Energy, Tamilnadu Directors' Report Directors' Report

Dear Shareholders, CONSOLIDATED FINANCIAL RESULTS DIVIDEND PRINCIPAL POWER ASSETS

The Directors have the pleasure in presenting the Eleventh During the year 2010-11, the Company has achieved an The members are aware that the Company is currently KSK's current principal power projects are as follows:- Annual Report together with the audited statements of overall consolidated turnover of Rs. 11,592.64 million. involved in implementation of various projects and more Operational Power Plants accounts for the year ended March 31, 2011. (Rs. in million) specifically the 3600 MW power project through its Particulars 2010-11 2009-10 downstream subsidiaries which is one of the largest single Ý Arasmeta, a 86 MW coal based power plant in STANDALONE FINANCIAL RESULTS Income 11,592.64 5,558.75 location greenfield project by private enterprise anywhere Chhattisgarh; The standalone financials are briefly summarized below: Operating expenses (excluding in India. In order to meet the investment requirements for Ý Sai Regency, a 58 MW natural gas based power plant (Rs. in million) interest and depreciation) 5,880.93 1,864.00 various ongoing projects, which will contribute to the and 18.9 MW wind power project in Tamil Nadu; Particulars 2010-11 2009-10 Earnings before interest, shareholders' wealth in the long term, the Directors have Income 1,063.99 1,980.31 tax and depreciation (EBITDA) 5,711.71 3,694.75 Ý Sitapuram, a 43 MW coal based power plant in Andhra not recommended any Dividend to the equity shareholders Expenditure 495.28 411.39 Interest and finance charges 2,560.55 1,246.38 Pradesh; Depreciation 81.26 13.84 Depreciation 1,223.81 259.73 for the financial year 2010-11. Ý VS Lignite, a 135 MW lignite based power plant in Profit before tax for the year 487.45 1,555.08 Profit before tax for the year 1,927.35 2,188.64 As per the terms of issue and as approved by the Provision for taxation including Rajasthan; Provision for taxation including shareholders, the Company had paid dividend on 8% Deferred tax 152.46 284.60 Deferred tax (352.32) 275.93 Ý Wardha Warora, a 540 MW coal based power plant in Profit after tax 334.99 1,270.48 Cumulative Redeemable Preference Shares of Rs. 10/- Profit after tax 2,279.67 1,912.71 Surplus brought forward from each issued to L&T Infrastructure Finance Company Maharashtra; and Minority Interest 462.14 161.64 previous year 3,328.44 2,057.96 Limited proportionately from the date of allotment. Surplus brought forward from Ý KSK Wind Energy, a 52 MW Wind power project in Amount available for previous year 4,148.35 2,397.28 Tamil Nadu. appropriations 3663.43 3,328.44 REVIEW OF OPERATIONS Amount available for Preference dividend including tax 46.52 - Power projects under construction (Initial / appropriations 5,965.88 4,148.35 KSK Energy Ventures Limited (KSK) is a power project Surplus carried over 3,616.91 3,328.44 Progressed) Preference dividend including tax 46.52 - development company in India with experience in Earnings per share (Rs.) Basic and diluted 0.77 3.57 Surplus carried over 5,919.36 4,148.35 developing and operating multiple power plants across KSK Mahanadi, a 3,600 MW coal based power project in Earnings per share (Rs.) India. KSK operates in the power generation business and Chhattisgarh; and The turnover of the Company has decreased to Basic and diluted 4.75 4.92 is well positioned with long‐term fuel access to various KSK Dibbin, a 120 MW, run-of-the-river hydro electric Rs. 1,063.99 million from Rs. 1,980.31 million. The profit The consolidated income of the Company has increased to power plants. power project in Arunachal Pradesh. before tax amounted to Rs. 487.45 million as against Rs. Rs.11,592.64 million from Rs.5,558.75 million registering a 1,555.08 million for the previous year. The profit after tax growth of 108%. The EBITDA amounted to Rs. 5,711.71 KSK presently has operational power plants capable of Planned power projects has decreased to Rs. 334.99 million from Rs. 1,270.49 million as against Rs.3,694.75 million for the previous year generating 933 MW of power and further actively involved Multiple thermal and hydro power projects across India. million. The decrease is mainly attributable to lower project registering a growth of around 55%. The profit after tax has in construction of two projects aggregating an additional development fee, as substantial part of the development increased to Rs.2,279.67 million from Rs.1,912.71 million 3720 MW. The Group’s initial foray and plans for REVIEW OF BUSINESS activity of 3600 MW Chhattisgarh project has been registering a growth of around 19%. The growth is mainly independent initiatives into power generation from Further, the operational and financial performance for the completed during 2009-10. Moving forward, the Group attributable to increased operations and higher realizations renewable energy sources marks the beginning of another financial year 2010-11 of each of the power plants has been performance would significantly be based on operational for the year. growth initiative. performance of the underlying power projects. outlined in the section titled “Management Discussion and Analysis Report”. T T R R O O P P E E R R ’ ’ S S R R O O T T C C E E R R I I D D Directors' Report Directors' Report

Dear Shareholders, CONSOLIDATED FINANCIAL RESULTS DIVIDEND PRINCIPAL POWER ASSETS

ISSUE OF PREFERENCE SHARES TO L&T Mr. Abhay M Nalawade and Mr. Henry Klein, Directors have INFRASTRUCTURE FINANCE COMPANY resigned from the Board subsequent to closure of the financial year under review. The Board places on record its LIMITED sincere appreciation for the services rendered by Mr. During the year under review, the Company has issued Abhay M Nalawade and Mr. Henry Klein during their tenure 100,000,000 (Hundred million) 8% Cumulative on the Board. Redeemable Preference Shares (CRPS) of Rs.10/- each at Mr. K. Bapi Raju ceased to be a Whole-time Director of the par amounting to Rs. 1,000 million to L&T Infrastructure Company with effect from December 20, 2010. However, Finance Company Limited. Consequent to the allotment of Mr. K. Bapi Raju continues as a Director of the Company. CRPS, the paid-up share capital of the Company (equity & preference) has increased from Rs.3,726.30 million to Further, Mr. K. Bapi Raju was appointed as President – Rs.4,726.30 million. Corporate Affairs of KSK Mahanadi Power Company Limited a subsidiary of the Company w.e.f. January 1, 2011 CORPORATE GOVERNANCE at a remuneration of Rs. 90 Lakhs per annum. In terms of the provisions of Section 314(1)(a) of the Companies Act, The Company's Report on Corporate Governance is 1956, Mr. K. Bapi Raju being a director of the holding attached and forms part of this Report. Certificate from the Company shall not hold any office or place of profit except Statutory Auditor of the Company M/s. Umamaheswara with the consent of the Company accorded by a special Rao & Co., Chartered Accountants confirming the resolution at the general meeting held for the first time after compliance with the conditions of Corporate Governance the holding of such office or place of profit. In compliance as stipulated under Clause 49 of the Listing Agreement is with the above, a special resolution is put up for member's attached to this report. approval in the Notice of the Annual General Meeting of the The Company has taken adequate steps for strict Company. compliance with the Corporate Governance guidelines, as amended from time to time. SUBSIDIARIES

MANAGEMENT DISCUSSION AND As at the end of the year, the Company had the following subsidiaries: ANALYSIS REPORT 1. KSK Electricity Financing India Private Limited; A separate Management Discussion and Analysis Report is 2. Arasmeta Captive Power Company Private Limited; also attached and forms part of this report. 3. Sai Regency Power Corporation Private Limited; PUBLIC DEPOSITS 4. VS Lignite Power Private Limited; 5. Wardha Power Company Limited; The Company has not accepted any deposits within the meaning of Section 58A of the Companies Act, 1956 and 6. KSK Wardha Infrastructure Private Limited (formerly the rules made there under during the financial year under KSK Technology Ventures Private Limited); review. 7. KSK Wind Energy Private Limited (formerly Bahur Power Company Private Limited); DIRECTORS 8. KSK Vidarbha Power Company Private Limited; T

R In accordance with the provisions of the Companies Act, 9. Sai Maithili Power Company Private Limited; O P 1956 and the Company's Articles of Association, Mr. S.R. 10. KSK Narmada Power Company Private Limited; E R

’ Iyer, Mr. Girish N Kulkarni and Mr. Anil Kumar Kutty, 11. KSK Dibbin Hydro Power Private Limited; S

R Directors retire by rotation at the forthcoming Annual 12. Kameng Dam Hydro Power Private Limited; O

T General Meeting and being eligible, offers themselves for 13. J R Power Gen Private Limited; C

E re-appointment.

R 14. KSK Mahanadi Power Company Limited; I

D 15. KSK Upper Subansiri Hydro Energy Private Limited;

8 Annual Report 2010-11 | KSK Energy Ventures Limited Directors' Report

16. Field Mining and Ispats Limited; forthcoming Annual General Meeting of the Company and 17. KSK Dinchang Power Company Private Limited; being eligible, offer themselves for re-appointment. As 18. KSK Jameri Hydro Power Private Limited; and regards the accounts and notes thereof, the same are self 19. Tila Karnali Hydro Electric Company Private Limited. explanatory and do not require further explanation.

CONSOLIDATED FINANCIAL STATEMENTS CONSERVATION OF ENERGY,

Vide General Circular No.:2/2011 dated February 8, 2011, TECHNOLOGY ABSORPTION AND the Ministry of Corporate Affairs, GoI has granted a general FOREIGN EXCHANGE EARNINGS AND exemption to companies from attaching the Balance OUTGO Sheet, Profit and Loss Account and other documents a) Conservation of energy : Not applicable referred to in Section 212(1) of the Act in respect of its b) Technology absorption : Not Applicable subsidiary companies, subject to fulfillment of the c) Foreign exchange earnings and outgo : conditions mentioned therein. Accordingly, the said (Rs. in million) documents are not being attached with the Balance Sheet 2010 - 11 2009 - 10 of the Company. A gist of the financial performance of the Foreign exchange earnings - 25.84 subsidiary companies is contained in the report. The Foreign exchange outgo 4.97 11.32 Annual Accounts of the subsidiary companies are open for inspection by any Member / Investor and the Company will PERSONNEL & INDUSTRIAL RELATIONS make available these documents/ details upon request by Relations between employees and the management any Member of the Company on to any investor of its continued to be cordial during the year. The Human subsidiary companies who may be interested in obtaining Resource Department is committed in its quest to improve the same. Further, the Annual Accounts of the subsidiary and maintain employee morale and satisfaction at all companies will be kept open for inspection by any investor levels. at the Company’s Head Office and that of the subsidiary Particulars of Employees: The particulars of employees company concerned and would be posted on the website as required to be disclosed pursuant to the provisions of of the Company. Section 217(2A) of the Companies Act, 1956 read with In terms of Clause 32 of the Listing Agreement with the Companies (Particulars of Employees) Rules, 1975 as Stock Exchanges and as prescribed by Accounting amended, forms part of this Report. However, as per the Standard 21 notified by the Government of India under provisions of Section 219(1)(b)(iv) of the Companies Act, Section 211(3C) of the Companies Act, 1956, the Audited 1956, the report and the accounts are being sent to all the Consolidated Financial Statements duly audited by shareholders excluding the aforesaid information. Any Statutory Auditors are annexed. shareholder desirous of obtaining such particulars may AUDITORS write to the Company Secretary at the Registered Office of the Company. M/s. Umamaheswara Rao & Co, Chartered Accountants, Hyderabad, Auditors of the Company will retire at the T R O P E R ’ S R O T C E R I D

KSK Energy Ventures Limited | Annual Report 2010-11 9 Directors' Report - - - -

and 85.00 Field March Mining Ispats 31,2011 Rs 10/- 170,000 Limited* s s h e e c r r a a a e h - h / S S 0

for preventing and detecting fraud and other y

- - - t . t DIRECTORS' RESPONSIBILITY STATEMENT i i s ower ardha u 87.00 u R March q P Rs 10/-

q Limited W f 31,2011 (547.22) irregularities; Company 1. 47,762,190 Class ‘A’ E o fully paid-up 2. 271,875,617 Class ‘B’ E of Rs. 10/- each, fully In terms of Section 217 (2AA) of the Companies Act, 1956, paid-up - Ý the annual accounts have been prepared on a going - your Directors hereby confirm that: 74.00 ower Rs 10/- (36.80) March P (215.33) Private Limited 31,2011 VS Lignite

concern basis. 37,000,000 Ý in the preparation of the Annual Accounts, the - - 73.92

Sai 253.48 applicable accounting standards have been followed; 711.03 ower

ACKNOWLEDGEMENTS Rs 10/- P March Private Limited 31,2011 Regency 12,360,000 Corporation , e h r ch Ý appropriate accounting policies have been applied c a a Your Directors would like to express their grateful a h e e

s - -

/ / r 0 0 e 1 1 - -

consistently. Judgment and estimates which are p . . appreciation for the assistance and co-operation received ower s s 1 51.00 March . P 130.50 266.74 R R Rs 10/- 31,2011 Private

Limited Captive e f f Arasmeta reasonable and prudent have been made so as to give from the Financial Institutions, Banks, Government Company 1. 25,500,000 Class ‘B’ Equity Shares o fully paid-up 2. 13,005,000 Class ‘B’ Equity Shares o R called up"

- true and fair view of the state of affairs of the Company Authorities, Customers, Vendors and Members during the - 17.73 90.40 100.00 Rs 10/- KSK India

as at the end of the financial year and of the profit of the March Private Limited

accordance with the provisions of the Companies Act, KSK 100.00 March Hydro P Jameri Private Rs 10/- 31,2011 110,000 Limited* 1956 for safeguarding the assets of the Company and - - - - ower KSK 100.00 P March Private Rs 10/- 100,000 Limited* 31,2011 Dinchang Company - - - On behalf of the Board of Directors, - KSK 40,000 100.00 March Hydro Upper Private Energy Rs 10/- 31,2011 Subansiri KSK Energy Ventures Limited Limited* - - - 89.19 Rs 10/- ower KSK March P 31,2011 Limited* Company Mahanadi

Place: Hyderabad T.L. Sankar 2,062,549,994 4 - - - Date: August 12, 2011 Chairman - ower 99.87 Rs 10/- Gen Private March 7,660,330 Limited* 31,2011 J R P - - - - ower 10,000 100.00 Dam Hydro Rs 10/- P Private March Kameng Limited* 31,2011 - - - - ower KSK 10,000 100.00 Hydro P March Dibbin Rs 10/- Private 31,2011 Limited* - - - - 10,500 100.00 ower Rs 10/- KSK March P Private 31,2011 Limited* Narmada Company - - - - 50,000 100.00 Rs 10/- ower March P 31,2011 Private Limited* Company Sai Maithili

- - - - 10,500 100.00 Rs 10/- ower KSK March P Private 31, 2011 Limited* Vidarbha Company - - - 74.00 Rs 10/- 370,000 March (141.43) 31,2011 Energy Private Limited KSK Wind

- - - - 100.00 Rs 10/- ardha T KSK 150,000 Private March W Limited* 31,2011 R Infrastructure O P E R ’ S E R R O U T articulars X alue of Equity Shares C P E E ace V N F Extent of Holding Company’s Interest (%) held by the Holding Company

Number of Equity Shares held by the Holding Company (Nos) Net aggregate amount of profit/(loss) of the subsidiary company of the current financial year so far as it concerns the members of the holding company - Dealt with or provided in the accounts of the holding company - Not dealt with or provided in the accounts of Net aggregate amount of profit/(loss) of the subsidiary for the previous financial years so far as it concerns the members of holding company - Dealt with or provided in the accounts of holding holding company company - Not dealt with or provided in the accounts of holding company R The financial year of the Subsidiary Company ended on I N D A 3 2 1 4 5 6 Statement pursuant to Section 212 of the Companies Act, 1956 relating Subsidiary (All amounts in Indian Rupees Million, except share data and where otherwise stated)

10 Annual Report 2010-11 | KSK Energy Ventures Limited KSK Energy Ventures Limited | Annual Report 2010-11 11 Directors' Report - - - -

and 85.00 Field March Mining Ispats 31,2011 Rs 10/- 170,000 Limited* s s h e e c r r a a a e h - h / S S 0

for preventing and detecting fraud and other y

- - - t . t DIRECTORS' RESPONSIBILITY STATEMENT i i s ower ardha u 87.00 u R March q P Rs 10/-

Sai 253.48 applicable accounting standards have been followed; 711.03 ower

s - -

/ / r 0 0 e 1 1 - -

consistently. Judgment and estimates which are p . . appreciation for the assistance and co-operation received ower s s 1 51.00 March . P 130.50 266.74 R R Rs 10/- 31,2011 Private

- true and fair view of the state of affairs of the Company Authorities, Customers, Vendors and Members during the - 17.73 90.40 100.00 Rs 10/- KSK India

as at the end of the financial year and of the profit of the March Private Limited

year under review. Your Directors also wish to place on 31,2011 Financing Electricity Company for the period; record their deep sense of appreciation for the excellent 570,115,305 3 ila - - - services of the executives, staff and the workers of the - T July Hydro Ý proper and sufficient care has been taken for the 80.00 Private Karnali 80,000 Electric Limited* 15,2011 Company NR 100/- maintenance of adequate accounting records in Company. (Rs. 62.50/-) - - - - ower accordance with the provisions of the Companies Act, KSK 100.00 March Hydro P Jameri Private Rs 10/- 31,2011 110,000 Limited* 1956 for safeguarding the assets of the Company and - - - - ower KSK 100.00 P March Private Rs 10/- 100,000 Limited* 31,2011 Dinchang Company - - - On behalf of the Board of Directors, - KSK 40,000 100.00 March Hydro Upper Private Energy Rs 10/- 31,2011 Subansiri KSK Energy Ventures Limited Limited* - - - 89.19 Rs 10/- ower KSK March P 31,2011 Limited* Company Mahanadi

- - - - 10,500 100.00 Rs 10/- ower KSK March P Private 31, 2011 Limited* Vidarbha Company - - - 74.00 Rs 10/- 370,000 March (141.43) 31,2011 Energy Private Limited KSK Wind

10 Annual Report 2010-11 | KSK Energy Ventures Limited KSK Energy Ventures Limited | Annual Report 2010-11 11 12 A N N E X U R E Annual Report 2010-11 |KSKEnergy V

Statement pursuant to Section 212 of the Companies Act, 1956 relating to Subsidiary Companies (Contd..) (All amounts in Indian Rupees Million, except share data and where otherwise stated)

Particulars KSK KSK Wind KSK Sai Maithili KSK KSK Kameng J R Power KSK KSK KSK KSK Tila Tila KSK Arasmeta Sai VS Lignite Wardha Field Wardha Energy Vidarbha Power Narmada Dibbin Dam Gen Mahanadi Upper Dinchang Jameri Karnali Karnali Electricity Captive Regency Power Power Mining Infrastructure Private Power Company Power Hydro Hydro Private Power Subansiri Power Hydro Hydro Hydro Financing Power Power Private Company and Private Limited Company Private Company Power Power Limited* Company Hydro Company Power Electric Electric India Company Corporation Limited Limited Ispats Limited* Private Limited* Private Private Private Limited* Energy Private Private Company Company Private Private Private Limited* Limited* Limited* Limited* Limited* Private Limited* Limited* Private Private Limited Limited Limited Limited* Limited*(NR) Limited*(INR)

March March March March March March March March March March March March March March March March March March March March 31,2011 31,2011 31, 2011 31,2011 31,2011 31,2011 31,2011 31,2011 31,2011 31,2011 31,2011 31,2011 31,20113 31,20113 31,2011 31,2011 31,2011 31,2011 31,2011 31,2011

1 Share capital 1.50 49.10 0.11 0.50 0.11 0.10 0.10 76.70 23,125.50 0.40 1.00 1.10 10.00 6.22 5,701.15 525.50 214.80 1,735.70 3,961.80 2.00 entures Limited 2 Share application money - 25.88 - - - - - 73.50 441.00 ------197.05 - 269.90 689.11 32.40 pending allotment

2 Reserves (includes debit - (40.00) ------89.72 423.94 1,160.33 (252.13) (159.03) - balance of Profit and loss A/c)

3 Total assets 1.50 2,452.77 2.07 5.43 16.76 563.98 591.59 300.83 52,502.97 1,179.87 23.57 18.24 10.00 6.22 5,790.87 4,417.84 3,181.16 9,294.21 26,922.33 52.07

4 Total liabilities 1.50 2,452.77 2.07 5.43 16.76 563.98 591.59 300.83 52,502.97 1,179.87 23.57 18.24 10.00 6.22 5,790.87 4,417.84 3,181.16 9,294.21 26,922.33 52.07

5 Investment (except in case of - 52.81 ------1.00 - - - - - 200.00 - 25.78 170.00 - - investment in subsidiaries)

6 Turnover (including other income) - 177.04 ------26.36 1,040.20 1,965.28 2,512.45 3,889.08 -

7 Profit/(loss) before taxation - (141.43) ------24.79 142.33 255.28 (220.54) (1,076.66) -

8 Provision for taxation 0.03 - - - - 0.01 - - 75.54 - - - - - 7.06 11.83 1.80 (5.21) (529.44) -

9 Profit/ (loss) after taxation and - (141.43) ------17.73 130.50 253.48 (215.33) (547.22) - write back

10 Proposed dividend (including ------interim dividend and dividend distribution tax thereon)

Notes: *Companies under construction stage. Tax provision represents the tax on other income earned. 1 Arasmeta Captive Power Company Private Limited, VS Lignite Power Private Limited, Sai Regency Power Corporation Private Limited and Wardha Power Company Limited are subsidiaries of KSK Electricity Financing India Private Limited (KSKEFIPL), which is 100% subsidiary of the Company. 2 Field Mining and Ispats Limited is a subsidiary of Wardha Power Company Limited. 3 The financial year of the subsidiary ends on July 15 every year, however, for the purpose of consolidation the accounts of the subsidiary is being prepared and considered upto March 31, 2011. 4 51% of holding has been considered for the purpose of Consolidation. 5 The annual acounts for 2010-11 for all the subsidiaries are available at Company's Head office. Any investor either of Holding Company or any subsidiary Company can seek any information at any point of time by making a request in writing to the Company Secretary of the Company. Further, the annual accounts for all the subsidiaries are also available on the Company's website: www.ksk.co.in Management DiscussionandAnalysis 1. Source: CEA ANNEXURE Source: CEA 1.1 Presently Energy INDUSTRY gone Consequently growing The the availability projected factors, 11th W the This 14,228 The Installed up ith plays last to installed population is Five its India steadily the MW fiscal. it ambitious TO a growth is Y Capacity liberalization STRUCTURE 10 15 20 of pivotal greatest ear is 0 5 quite of 10 15 20 25 continuous, 5 THE - among generation capacity from Plan of unlikely and role mission DIRECTORS’ Indian 11.6% capacity (FY08 and the in economic of during Thermal FY08 Capacity the that reliable the largest capacity economy – in of & Achieved (GW) 12). economic FY06 additions power the “P DEVEL FY Achieved (GW) ower

target However producers 2010-11. and development, to additions of Capacity AdditioninFY08-11 sector depends 21% REPORT Capacity AdditioninFY11 for the cost in and OPMENT capacity all any as country , FY09 -effective was However with human by in of during year heavily FY11. 2012”, taken electricity continuous T : addition arget (GW) the as till Hydro T development arget (GW) energy FY the on now on up energy the 2010-11 capacity the and March would . Government and India , delays performance KSKEnergy V as FY10 the requirement also energy be 31, has share of addition achieved in T a equally 2011 arget (GW) generated nation. the T of arget (GW) of being construction private and stood India is entures Limited|Annual Report2010-11 lower in of Nuclear by The growth the annual FY11 is India March 5.55% at companies growth targeting prime than 173,626 of is consumption 2012 of more targeted power mover of the increasing an to . MW power in projects 10% 20% 30% 40% 50% 60% 70% add economy 0% sector installed 10% 20% 30% 40% 50% 60% of figure 0% with economic 78 in . terms. at due the GW comparison of capacity rapid depends 21,441 addition to during W multiple growth. ith pace. MW has the the on to of .

13 M A N A G E M E N T D I S C U S S I O N A N D A N A L Y S I S 12 A N N E X U R E Annual Report 2010-11 |KSKEnergy V