Sun TV Network Limited CORPORATE INFORMATION BOARD OF DIRECTORS Kalanithi Maran Chairman & Managing Director Kavery Kalanithi Joint Managing Director S. Selvam S.Sridharan M.K.Harinarayanan J.Ravindran Nicholas Martin Paul SECRETARY R.Ravi BANKERS City Union Bank Limited, Mandaveli, Chennai -28 ABN Amro Bank, Haddows Road, Chennai -6 Kotak Mahindra Bank Limited, Annasalai, Teynampet, Chennai -18 Standard Chartered Bank, Haddows Road, Chennai 6 The Karur Vysya Bank Limited, Anna Salai, Teynampet, Chennai -18 ICICI Bank Limited, Cenotaph Road, Teynampet, Chennai -18 HDFC Bank Limited, ITC Centre, Chennai -2 Axis Bank Limited, Mylapore, Chennai - 4 Corporation Bank, Mylapore, Chennai - 4 Indian Bank, Kodambakkam, Chennai -24 AUDITORS M/s S.R. Batliboi & Associates Chartered Accountants, TPL House, Second Floor, 3, Cenotaph Road, Teynampet, Chennai - 18 REGISTERED OFFICE 4, Norton Road, Mandaveli, Chennai - 28 REGISTRAR AND SHARE TRANSFER AGENT M/s Karvy Computer share (P) Ltd, 'Karvy House” 46, Avenue 4, Street No.1, Banjara Hills, Hyderabad 500 034. 01 Annual Report 2009-2010 Sun TV Network Limited AUDIT COMMITTEE S.Sridharan Chairman M.K.Harinarayanan J.Ravindran Nicholas Martin Paul REMUNERATION COMMITTEE J.Ravindran Chairman S.Sridharan M.K.Harinarayanan Nicholas Martin Paul INVESTORS GRIEVANCE COMMITTEE M.K.Harinarayanan Chairman S. Sridharan J.Ravindran Nicholas Martin Paul SHARE TRANSFER AND TRANSMISSION COMMITTEE Kalanithi Maran Chairman Kavery Kalanithi MANAGEMENT Kalanithi Maran Chairman & Managing Director Kavery Kalanithi Joint Managing Director Ajay Vidyasagar Chief Operating Officer S.Natrajhen Chief Financial Officer S.Kannan Chief Technical Officer Hansraj Saxena Chief Operating Officer – Sun Pictures R.Ravi Company Secretary and Compliance Officer Contents Page Nos. Financial Performance for Last 5 years 3 Notice 4 - 5 Directors Report 6 - 9 Management Discussion and Analysis 10 - 15 Corporate Governance Report 16 - 27 Auditors’ Report on Standalone Financial Statements 28 - 33 Standalone Financial Statements 34 - 67 Statement Pursuant to Section 212 68 Auditors’ Report on Consolidated Financial Statements 69 - 70 Consolidated Financial Statements 71 - 106 Attendance Slip / proxy 107 02 Annual Report 2009-2010 Sun TV Network Limited FINANCIAL PERFORMANCE FOR LAST 5 YEARS ( All amounts are in Millions of Indian Rupees, unless otherwise stated ) Particulars 2009-10 2008-09 2007-08 2006-07 2005-06 Total Income 14,375.2 10,915.2 9,259.9 7,264.0 3,391.1 Total Expenditure (Excluding Interest & Financial Charges) 5,699.0 4,215.3 3,522.1 3,144.1 1,331.1 Profit before interest and tax 8,676.2 6,699.9 5,737.8 4,119.9 2,060.0 Interest & Financial Charges 12.0 38.9 55.6 30.9 65.0 Profit Before Taxation 8,664.2 6,661.0 5,682.2 4,089.0 1,995.0 Provision for Taxation 2,990.4 2,289.9 2,012.4 1,400.8 692.7 Profit after tax 5,673.8 4,371.1 3,669.8 2,688.2 1,302.3 Earnings Per Share (Face value Rs. 5 /-) 14.40 11.09 9.31 6.85 5.25 Notes: 1. Gemini TV Private Limited and all units and divisions of Udaya TV Private Limited except FM Radio division were merged with the Company effective from 1st April 2006. 2. The equity shares of Rs. 10/- each were subdivided into equity shares of Rs. 5/- each with effect from 15th May, 2007. 03 Annual Report 2009-2010 Sun TV Network Limited NOTICE NOTICE is hereby given that the Twenty Fifth Annual General Meeting of the Shareholders of Sun TV Network Limited will be held at Narada Gana Sabha, 314, TTK Road, Chennai - 600018 on Thursday, the 5th day of August 2010 at 10.00 AM to transact the following business: ORDINARY BUSINESS 1. To receive, consider and adopt the Audited Balance Sheet as at 31st March 2010 and the Profit & Loss Account for the financial year ended on that date together with the Reports of Directors and Auditors thereon. 2. To declare dividend on equity shares. 3. To appoint a Director in the place of Mr. S. Sridharan, who retires by rotation and is eligible for re-appointment. 4. To appoint a Director in the place of Mr. M. K. Harinarayanan, who retires by rotation and is eligible for re-appointment. 5. To appoint Auditors and to fix their remuneration and in this regard to consider and if thought fit, to pass, with or without modification(s), the following resolution as an Ordinary Resolution: “RESOLVED THAT M/s. S. R. Batliboi & Associates, Chartered Accountants, Chennai be and are hereby appointed as the Auditors of the Company to hold office from the conclusion of this Annual General Meeting till the conclusion of the next Annual General Meeting on a remuneration, the amount and timing of which are to be decided by the Audit Committee / Board of Directors of the Company.” BY ORDER OF THE BOARD R. RAVI COMPANY SECRETARY Regd. Office: 4, Norton Road, Mandaveli, Chennai – 600 028 May 28, 2010 NOTES: 1. A member entitled to attend and vote at the meeting is entitled to appoint a proxy to attend and vote instead of himself and the proxy need not be a member of the company. For appointment of a proxy to be effective, the proxy form (enclosed) shall be duly filled, stamped, executed and lodged with the Registered Office of the Company at least 48 hours before the time fixed for the commencement of the meeting. 2. The Register of members and the Share Transfer Books of the Company will remain closed from 24th July 2010 to 5th August 2010 (both days inclusive) in terms of Section 154 of the Companies Act, 1956. 3. The Dividend as recommended by the Board of Directors and to be approved by the Shareholders at the Annual General Meeting to be held on Thursday, the 5th August 2010 shall be paid to those members whose names appear on the Register of Members as on the close of 23rd July 2010. 4. Members are requested to quote their DP ID & Client ID/ Folio Numbers in all correspondence with the Company. 5. Members and/or their proxies should bring the Attendance Slips duly filled in for attending the meeting. 04 Annual Report 2009-2010 Sun TV Network Limited DETAILS OF DIRECTORS SEEKING APPOINTMENT/ RE-APPOINTMENT AT THE FORTHCOMING ANNUAL GENERAL MEETING (PURSUANT TO CLAUSE 49 OF THE LISTING AGREEMENT) Name of the Director Mr. S. Sridharan Mr. M. K. Harinarayanan Mr. S. Sridharan, aged 48 was Mr. M. K. Harinarayanan, aged 46 years, Brief Profile appointed as a non-executive is a non-executive independent Director Independent Director of the of the Company and was appointed in Company in January 2006. He has January 2006. He hails from a traditional over 22 years of experience and is a family who pioneered the brick industry in member of Madras Stock Exchange 1941. He is a developer of residential Limited. He has served as elected layouts in the western part of Chennai Director in the Board of Madras and owns and operates Service Stock Exchange Limited from Apartments to cater to the present influx September 1995 to September 2001 of entertainment, communication and IT and was the Vice President of the industries. Exchange from October 1996 to November 1997. Directorships held in other public companies (excluding Private Companies and Foreign Companies) Nil Nil Memberships/ He is the Chairman of the Audit He is the Chairman of the Investor's Chairmanships of Committee and member of the Grievance Committee and a member of committees in public Investors Grievance Committee and Audit Committee and Remuneration companies Remuneration Committee of Sun TV Committee of Sun Tv Network Limited. Network Limited Shareholding of Non- Executive Director Nil Nil Relationships between directors inter-se Nil Nil 05 Annual Report 2009-2010 Sun TV Network Limited REPORT OF THE DIRECTORS TO THE SHAREHOLDERS Your Directors are pleased to present the Silver Jubilee Twenty Fifth Annual Report and Audited Financial Accounts of the Company for the financial year ended 31st March 2010. FINANCIAL RESULTS The financial highlights for the financial year ended 31st March 2010 are given below: (Rs.in Millions) Particulars For the year ended 31st March, 2010 31st March, 2009 Total Income 14,375.2 10,915.2 Total Expenditure (Excluding Interest & Financial Charges) 5,699.0 4,215.3 Profit before interest and tax 8,676.2 6,699.9 Interest & Financial Charges 12.0 38.9 Profit Before Taxation 8,664.2 6,661.0 Provision for Taxation 2,990.4 2,289.9 Profit after tax 5,673.8 4,371.1 Accumulated Profit, beginning of the year 9,833.1 7,051.8 Interim Dividend (591.1) (591.1) Tax on Interim dividend (100.5) (100.5) Proposed dividend (2,364.5) (394.1) Tax on Proposed dividend (392.7) (67.0) Transfer to General Reserve (567.4) (437.1) Profit Carried forward 11,490.7 9,833.1 Earnings Per Share (Face value Rs.5/-) 14.40 11.09 The total Income for the Silver Jubilee year ended 31st March 2010 marked a record growth of 31.70 % at Rs. 14,375.2 millions as against Rs. 10,915.2 millions during the previous year ended 31st March 2009. The year on year growth in Profit before taxes continued to grow and stood at 30.07 % at Rs. 8,664.2 million as against Rs. 6,661.0 millions in the previous year. The Profit after tax was higher by 29.80 % at Rs. 5,673.8 million as against Rs. 4,371.1 million in the previous year after providing for a higher provision towards income tax, deferred tax and fringe benefits tax of Rs.