105 taj

TAJ HOTEL LTD. PEAG: 1

A

ON

PREPARED BY

PANCHAL CHAITANY A.

ROLLNO: 105

S.Y.B.B.A.

GUIDED BY

SUBMITTED TO

FACULTY OF BUSINESS ADMINISTRATION

DHARMSINH DESAI UNIVERSITY, NADIAD

PREPARED BY: PANCHAL CHAITANY A.


The faculty of business administration was started in

the year of 1999. As BBA has been considered as the

professional course so the theoretical knowledge is not

enough.

The practical knowledge at the second year BBA level

is to develop the student ability knowledge about

industrial marketing finance level in aroused to develop

the skill and attitude.

This report is based on 2 year annual report of Indian

hotel Taj ltd. it includes analysis of balance sheet profit

and loss a/c ratio have been the calculated with

interpretation present clear of financial profitability and

liquidity of the company.

This type of practical knowledge is very inevitable for

the manager of tomorrow.



In the second year BBA it had introduced the Indian

hotel ltd. but this report many person helped me.

First I would like to thank to our director sir G S Shah

then I also thankful to Prof. Rasmi Gang to provide full

detail about the command and support us I would also like

to thank my friend Retan J Patel I am thank full to Faculty

of business administration for going me this golden

opportunity.

Name :- Panchal Chaitany A

Roll No.: 105

S Y B B A



1. COMPANY PROFILE 5

2 RATIO ANALYSIS 10

3 TABLE OF RATIOS 34

4 ACCOUNTING POLICY 36

5 AUDITORS REPORT 43

6 DIRECTORS REPORT 49

7 COMMON SIZE STATEMENT 59

8 CASH FLOW STATEMENT 61

9 CONCLUSION 67



NAME : The Indian Hotels Company Limited.

ADDRESS : Mandilk House, Mandilk Road,

Mumbai 400 001

BOARD OF DIRECTORS :

Chairman: Ratan N Tata

Vice Chairman: R K Krishna Kumar

Anil P Goel: Executive Director Finance

Abhijit Mukerji: Executive Director Hotel Operations

Ajay K Misra: Sr. Vice-president Sales & Marketing

H K Shrinivas: Sr. Vice-president Tecnology & CIO

Jyoti Marang: Chief operating officer gate way Hotels.

Jamshed S Daboo: Chief Operating Officer Premium

Hotels

P Snaker: Vice-president and company secretary

Sumit Guha: vice-president project and business

Devlopment



BANKERS NAME:

The Hong Kong and Shanghai Banking Corporation Limited

Standard Chartered Grind lays Bank

Citibank N.A

HDFC Bank

NAMES OF SUBSUDIARY COMPANY :-

Taj Investment & Finance Co. Ltd.

Roots Corporation Ltd.

Taj Sats Air Catering Ltd.

United Hotels Ltd.

AUDITORS NAMES:

-> S.B.Billimoria and Company

-> N.M.Raiji and company

COMPANY SECRATORIES NAME:

P.Sankar (Vice President – legal and Company Secretary)



LINE OF BUSINESS :

hotels

resorts

palaces



AWARDS & ACCLAIMS

AWARDS – TAJ HOTELS RESORTS AND PLACES

Corporate global Awards

Taj hotels resorts and places was the winner of the selling

long haul Travel Awards 2007.

Taj spa was honored with the SENSES Visions Award 2007

at the SENSES wellness Awards 2007 held in Berlin

Corporate National Awards:

CNBC TV 18 International Travel For Outstanding

Exporter of the year 2007 in the Travel Truism &

Hospitality category.

Dun & Bradstreet American express corporation Award

2007 accolades The Indian Hotels Company Limited as

India’s top 500 Companies 2007 in the “Hotel”

Category.

India’s most customer responsive Hotel-category Hotels

by the Avaya Global connect Customer Responsiveness

Award 2007.



HUMAN RESOURCE AND SOCIAL RESPONSIBILITY:-

The manpower employed in your company for 2006/07 was

10018 which included executives, barginable staff, probations,

trainees, appertains and contract employees. The in numbers is

mainly on a/c of Amalgamation of five group companion with your

company.

This initiative called emerging herders of Taj or EL Taj is a

process that provided an opportunity to high performing

executive in different grades to participating in developmental

and Assessment centers where these executive participate in

exercises and simultaneous to identify strong and week

competencies.

The aim is to crate a reservoir of talent of 400 top notch

people by the end of this deaden with leadership qualities to man

the slots that will arise due to the growth and expansion plans of

company.

The expansion plans for your company are being supported by

an initiative of aggressively young catering college graduates and

providing them with high quality training. The existing Taj

management trainee program is being further strengthened and

as an extension of this young hotelier program a hotel operations

management trainee programs is being initiated.



The financial statement as prepare and presented annually

are of little use for guidance of perspective investor and even

management it relationship between financial statement useful

due to relation between two related items of financial statement

is known as ratio.

The ratio is define as the indicated at two mathematical

expansive is known as ratio the relation financing statement is

known as ratio.

The ratio helps to summarize large quantities of financing

data and to make qualitative judgment about the firms finance

per the point to note that the ratio relating a quantity relationship

quantitative judgments.

In view of the requirement the various at ratio we can

classify them into the following.

:: Important of Ratio Analysis ::

As a tool of financial manage performance of a firm in

respect of the following aspect.



1. Overall Profitability :

Unlike the outside partner that are interested in one aspect

of the financial positions of a firm the management is constantly

concerned about the overall profitability of the enterprise that is

they are concerned about the ability of the firm to meet return to

its owners and ensure optimum utilization of the assets of the

firm.

2. Inter firm Comparison :

Ratio analysis not only thought light on the financial

position of a firm but also with the due to inter firm is made

possible due to the inter average a single in standard or that

performance of a should be in confirmed with that of the

industries it belongs.

3. Operating Efficiency :

Yet another view point of the management is that its

thought light on degree of efficiency solvency of firm is in the

analysis depending upon the sales revenues generated by the

use of its assets total as well as its components.

4. Liquidity Position :



With the help of ratio analysis conclusion can be drown

requires the liquidity position in the firms.

Maturing debts. At a year as well as to reply the principal.

5. Trend Analysis :

Finally ratio analysis enable a firm to make in other goods

whether made possible by use of trend analysis the significant of

trend analysis ratio of trend.



GROSS PROFIT RATIO

It is a ratio expensive the relationship the between gross

profit earned to net sales gross profit is the gross earning the

company. It is useful indication of the profitability of business

gross profit between prices sales volume and costs.

Gross profit measure the percentage of each sales rupee

remaining offer the firm has paid for its goods a firms should

have a resources gross margin to ensure that all its appear

expensive paid off.

Gross Profit

Gross Profit Ratio = -------------- * 100

Net Sales

For 2006-07,

Gross Profit


Net Sales

1038.92

= ---------- * 100 = 67.42 %

1540.86

For 2007-08,



Gross Profit


Net Sales

1226.10

= ---------- * 100 = 69.49 %

1764.51

6666.567

67.568

68.569

69.570

2006-07 2007-08

Series1

:: Interpretation ::

The ratio that for a sales of very rupee 100 a margin of year

is rs. 67.42 and is 69.49 in year 2007 and 2008 respectively are

available from which the operating expansive of the business are

to be recorded gross profit is opportunity increased in the current

year. The higher the gross profit ratio better for company and

vice versa.



NET PROFIT RATIO

The ratio measures the relationship between net profit and

sales of a firm this ratio indicates what percent of sales revenue

is left to the prospectors after all operating expensive are.

The ratio in useful to measure the over all profitability

performance of the business and shows the efficiency of the

company to earn amount the profit earned its net sales.

The N.P. margin is indicates to mgt. ability to operates the

business with sufficiently success not only to over from revenue

of period of the cost of production but also to the provides fair

returns to the investors and owners of the firm.

Net Profit

Net Profit Ratio = ------------ * 100

Net Sales

For 2007,

322.39

-------- * 100 = 20.92 %

1540.66

For 2008,



377.46

--------- * 100 = 21.39 %

1764.51

20.6

20.8

21

21.2

21.4

21.6

2006-07 2007-08

Series1

Interpretation

The ratio shows to profitability position of the business if the

company makes important of rs 100 they can earn rs 20.92 in the

year 2007 but in the year 2008 the net profit ratio goes on decide

in this year company makes a profit of rs 21.39 this saws. As such

these amount the company has to created reserve and pay

dividend to its shareholder’s the company is enable to pay

dividend or create reserve because profit is high so corrective

measure shows taken by the company to improve answer.



Return on Capital Employed

It is an index of profitability of business and is obtained

by comparing is normally capital expense and included share

capital reserves and along terms loan such as debentures.

The success or other of the enterprises in judge with the

help of this ratio. It is perhaps the most of important ratio the

view point management.

Earning before Increased Tax

Return on Capital Employed = ------------------------------------ * 100

Capital Employed

For 2007, For 2008,

EBT = 474.64 EBT = 580.47

+Interest = 071.89 + Int. = 094.28

-------- * 100 ---------

EBIT = 546.53 674.75

546.64

2007 = --------- * 100 = 18.92 %

2889.88

674.75



2008 = --------- * 100 = 20.26 %

3330.77

18

18.5

19

19.5

20

20.5

2006-07 2007-08

Series1


Thought the ratio in 2007 is 18.92 it has to 20.26 % in

2008. this show that against capital of rs. 100 return on it comes

to rs. 18.92 is 2007, which has increased to rs. 20.26 in 2008

from the comparison between the year can more so it is better

for the company because the higher ratio use of capital

employed.



RETURN ON SHARE HOLDER’S FUNDS

This ratio measures the return that the share as

compared to his invest this ratio is a great the practical important

with that of the other company & hence affects potential invest.

While there is no that the preference shareholders are

also owners of the firm, the level owners are the ordinary

shareholders who bear all the rise.

Net Profit After Tax

Return on Share Holders = ------------------------ * 100

Share Holder Fund

For 2007,

322.39

S.F. Ratio = -------- * 100 = 17.94 %

749.30

For 2008,

377.46

S.F. Ratio = -------- * 100 = 18.55 %

2035.10



17.6

17.8

18

18.2

18.4

18.6

2006-07 2007-08

Series1

Interpretation

This ratio indicates whether the one other on properties

funds is enough in relation to that the company indicates.

For every rs 100 rs 17.64 and 2008 respectively this

ratio is decrease in turn to share holder fund the share holders

are not sufficient return on their fund which they earn last year.



CRDITORS TURN OVER RATIO

The creditor turn over suggest the no of times the

amount of credit purchase is collected during the year while

creditor’s ratio indicated the turn over of days which the dues for

our creditor for credit for credit purchase obtained from creditors

vertically.

Creditors + BIP

Creditors Turnover Ratio = ------------------- * days

Credit Purchase

For 2007,

186.89

-------- * 365 = 555.12 ~ 555 Days

121.20

For 2008,

149.56

-------- * 365 = 417.10 ~ 417 Days

128.24



0

100

200

300

400

500

600

2006-07 2007-08

Series1


It is used to know the average period payment for credit

purchase the ratio indicates that 55.12 times the amount credit

purchased is paid during the year 2007. while is 2008 year

417.10 time the amount of credit ratio shows efficient of the

business.



DEBTORS TURNOVER RATIO

The debtors turnover invests the ratio indicates the number

of days during which the dues for credit sales are collected.

The higher this ratio the more dissatisfaction positions it

shares that credit and collection policy is week.

Debtors + B/R

Debtors Turnover Ratio = ------------------ * days

Credit Sales

Credit sales is equal to net sales because of lack

information all the sales are assumption to be credit. It shows the

efficient or otherwise of the collection policy the enterprise. The

higher the ratio the more dissatisfaction position it shows it

suggests that the credit and collection policy is week.

2007 2008

127.20 138.41

--------- * 365 = 30 days --------- * 365 =

29 days

1540.86 1764.51

28.5

29

29.5

30

30.5

2006-07 2007-08

Series1



STOCK TURNOVER RATIO

The number of times the average stock is turned our

during the year by the cost of goods sold by average stock the

year average stock is the average opening closing of the stock

year.

The ratio is very important in ability of a management

with which turnover ratio the firm of slow absolute and

management.

Cost of Goods Sold

Stock Turnover Ratio = -----------------------

Average Stock

2007 2008

501.44 538.35

-------- = 17.29 times -------- = 16.44 times

29.02 32.85

1616.216.416.616.817

17.217.4

2006-07 2007-08

Series1



Interpretation

This ratio shows the ability of the management which it

can move the stock in the year 2007 ratio is 17.29 times this

share the decrease turnover of stock.

The ability of company with which it can move the stock

as the year 2008 stock turnover ratio is increased the profitable

of the business chance are more it is good sign of their company

to this year 2008 is future also.



CURRENT RATIO

Current ratio is a measure of liquidity calculated dividing

the current assets by the current liabilities the current asset of a

firm represented those assets which can be in the ordinary of

business converted its cash within a short period of time normally

not exceeding a year. The current ratio of a firm measures its

short term solvency that is ability to meet short term obligations.

Current Assets

Current Ratio = ------------------

Current Liabilities

2007 2008

499.89 578.46

-------- = 9.69 : 1 -------- = 4.43 : 1

57.60 130.59

0

2

4

6

8

10

12

2006-07 2007-08

Series1

Interpretation



The standard for current ratio is 2:1 but the company is

away from this ratio in the year 2007 it was 9.69 which higher

decreased up to 4.43 in 2008 because high increase in liquid. It

also shows that on rs 1 current university the company have a

assets the company of rs 4.93 which is very high as compare to

the standard it means the company is able to pay liquid liability

easily.



LIQUID RATIO

Liquid ratio measure the liquid position of the firm to pay

to its debt within a every short period idea position is 1:1

It includes only those current assets that can be

connected into cash within a very short period liquid liabilities are

those which are to be paid the time period.

Liquid Assets

Liquid Ratio = ----------------

Liquid Liabilities

Her we assume that current liabilities and liquid

liabilities both are same.

2007 2008

470.87 545.61

-------- = 9.13 : 1 --------- * 4.18 : 1

57.60 130.59

0

2

4

6

8

10

2006-07 2007-08

Series1



Interpretation

In the year 2008 the liquid ratio of the company is 4.18

and in the year 2007 the liquid ratio of the company is 9.13. the

company liquid ratio is good the co. should try to maintains the

ratio in the to the future also.



ACID TEST RATIO

The ratio indicates the immediate capabilities of the

business to meet its every quick liabilities one defeats of current

ratio is that it fail to convey any information of the composite the

current asset of rupee of cash is considered equipment not so

prepaid expenses debtors and bills receivable.

Quick Asset

Quick Ratio = ----------------

Quick Liability

2007 2008

194.95 21284

--------- = 3.75 -------- = 1.63

5160 130.54

0

1

2

3

4

2006-07 2007-08

Series1

Interpretation



The acid test ratio shows the liquidity position or every rs

1 a have classes rs 3.75 and rs. 1.63 in the year 2007 and 208

respectively are available the ideal ratio id rs good point of 1 year

that the cash and bank balance are increase as compared to the

year 2007 this is because of the collection of sales period is

decreased the statement ratio is 0.5:1



FIXED ASSETS TURN OVER RATIO

This ratio indicates the efficient of with assets to

generates sales the higher the turnover ratio the more efficient is

the management and utilize of the asset to determine the

efficiency of the ratio its should be compared across time as well

with the concept or must be assets or fixed assets is likely to be

higher in the cash of an old and being equal.

Fixed Assets

Fixed Assets Turnover = ---------------- * 100

Sales

2007 2008

1360.65 1371.60

---------- * 100 = 0.88 times ---------- * 100 = 0.77 times

1540.86 1764.51

0.7

0.75

0.8

0.85

0.9

2006-07 2007-08

Series1



Interpretation

This ratio shows the relationship between sales and

fixed assets whether the fixed assets are being fully utilized or

not this ratio for the year 2007 was 0.88 and 2007 was 0.77

times which shows some satisfactory position.

This company ratio is should by maintain it’s position.

The company utilizes more fixed assets in 2007 this ratio for the

year 207 and 2008 times which shows some satisfactory.



Name of Ratios 2007 2008

A) Profitability Ratio

- Gross Profit Ratio 67.42 % 70 %

- Net Profit Ratio 20.92 % 21.39 %

- Return Shareholders Fund 18.91 % 20.26 %

- Return on Equity Shareholders Fund 17.93 % 18.54 %

- Return on Equity Share Capital 17.93% 18.54%

> Return on Capital Employed 534.73% 626.07%

> EPS 5.35 6.26

- Operating Ratio 96.28 % 91.40 %

B) Liquidity Ratio

- Current Ratio 10 : 1 4 : 1

- Liquid Ratio 9 : 1 4 : 1

- ACID Test Ratio 1.31 : 1 0.57 : 1

C) Solvency Ratio

- Debt. Equity Ratio 0.61 0.64

- Proprietary Ratio 53.88 % 53.90 %

- Capital Gearing Ratio

D) Efficiency Ratio

- Stock Turnover Ratio 17 times 16 times



- Debtors Ratio 30 days 29 days

- Creditors Ratio 563 days 423 days

- Debtors Turnover Ratio 12.17 12.75

- Creditors Turnover Ratio 0.86 0.65



Impairment of assets :

Impairment is ascertained at each balance sheet date in

respect of the company’s fixes assets. An impairment loss is

recognized whenever the carrying amount of an asset exceeds its

recoverable amount. The recoverable amount is the greater of

the net selling price and value in use. In assessing value in use,

the estimated future cash glows are discounted to their present

value, based on an appropriate discount factor.

(i) Assets taken on lease :

Operating lease payments are recognized as expenditure in

the profit and loss account on a straight line basis, representative

of the time pattern of benefits received from the use of the

assets taken on lease.

(j) Inventories :

Stock of food and beverage and operating supplies are

carried at cost (computed on weighted average basis) or Net

realizable value, whichever is lower.



(k) Investments :

i) Long term investments are carried at cost. However,

provision is made for diminution in value, other than

temporary, on an individual basis.

ii) Current investments are carried at the lower of cost and fair

value, determined on a category-wise basis.

(l) Miscellaneous expenditure :

Payments made under the voluntary retirement scheme,

including the additional liabilities towards leave encashment and

gratuity, arising pursuant to the voluntary retirement scheme,

are amortized over a period of 60 months, commencing from the

month in which the scheme is implemented, or up to 31st March,

2010, whichever is earlier.

(m) Taxes on income :

i. Income tax is computed in accordance with accounting with

accounting standard 22-‘accounting for taxes on income’

(AS-22), notified by the companies (Accounting standards)

rules, 2006. Tax expenses are accounted in the same period

to which the revenue and expenses relate.

ii. Provision for current income tax is made for the tax liability

payable on taxable income after considering tax

allowances, deductions and exemptions determined in

accordance with the prevailing tax laws. The differences

between the taxable income and the net profit or loss

before tax for the year as per the financial statements are

identified and the tax effect of timing differences is



recognized as a deferred tax asset or deferred tax liability.

The tax effect is calculated on accumulated timing

differences at the end of the accounting year based on

effective tax rates substantively enacted by the balance

sheet date that would apply in the years in which the timing

difference are expected to reverse.

iii. Deferred tax assets, other than on unabsorbed depreciation

or carried forward losses, are recognized only if there is

reasonable certainty that they will be realized in the future

and are reviewed fot the appropriateness of their respective

carrying values at each balance sheet date.

(n) Accounting for provisions, Contingent liabilities and

contingent assets :

Provisions are recognized in terms of accounting standard

29-‘Previsions, contingent liabilities and contingent assets’

(AS-29), notified by the companies (Accounting Standard)

Rules, 2006, when there is a present legal or statutory

obligation as a result of past events, where it is probable

that there will be outflow of resources to settle the

obligation and when a reliable estimate of the amount of

the obligation can be made. Contingent liabilities are

recognized only when there is a possible obligation arising

from past events due to occurrence or non-occurrence of

one or more uncertain future events, not wholly within the

control of the company, or where any present obligation

cannot be measuredin terms of future outflow or resources

or where a reliable estimate of the obligation cannot be



made. Obligations are assessed on an ongoing basis and

only those having a largely probable outflow of resources

are provided for. Contingent assets are not recognized in

the financial statements.

(o) Borrowing costs (Other than on debentures) :

Interest and other borrowing costs on specific borrowings,

attributable to qualifying assets, are capitalized. Other borrowing

costs are charged to revenue over the tenure of the loan.

(p) Debenture issue costs :

These are adjusted against the securities premium account,

in accordance with section 78 of the companies act, 1956.

2. Rights issue of simultaneous but unlinked issue of

equity shares and non-convertible debentures with

detachable warrants to the equity shareholders of

the company

i. The board of directors, at its meeting held on August 13,

2007 and September 27, 2007, approved the rights issue of.

a) Equity shares in the ratio of 1:5, at a price of Rs. 70 per

share, aggregating Rs. 843.99 crores :

b) 6% Non-convertible debentures with detachable warrants in

the ratio 1 : 10, of the face value of Rs. 100 each,

aggregating Rs. 602.85 crores :

c) An option to receive one equity share for every detachable

warrant held exercisable at a price of Rs. 150 per share

commencing from September, 1, 2009 to September 30,

2009. Assuming that all the warrant holders exercise their



option, the company would additionally raise Rs. 904.28

crores.

ii. The company has field the letter of offer on February 27,

2008, with the securities exchange board of India,

subsequent to which the rights issue opened on March 14,

2008 and closed on April 24, 2008.

iii. The company has allotted the 6% secured Non-convertible

debentures on May 13, 2008 and equity shares on May 23,

2008.

3. Non-convertible debentures :

The company has, during the year, issued 9.86% secured

non-convertible redeemable debentures, having a face

value of Rs. 10,00,000/- each, aggregating Rs. 300 crores.

The expenses in relation to the said issue, amounting to Rs.

1.05 crores, have been set off against the ‘Securities

Premium

Compensated absences

The company has a scheme for compensated absences for

employee, the liability for which is determined on the basis of an

actuarial valuation carried our at the end of the year.

vi. Other employee benefits

Other benefits comprising of long service awards and leave

travel allowances are determined on an undiscounted basis and

recognized based on the likely entitlement thereof.

(d) Fixed assets :



Fixed assets are stated at cost less

depreciation/amortisation and impairment losses, if any, Cost

includes expenses incidental to the installation of assets and

attributable borrowing costs.

(e) Depreciation/Amortization :

In respect of assets acquired before 16th December, 1993,

depreciation is provided under the straight-line method, at the

rates and in the manner specified in schedule XIV to the

companies Act, 1956, as existing prior to that date.

In respect of assets acquired on or after 16th December,

1993, depreciation is provided at the rates as specified in

schedule XIV to the companies act, 1956, as revised with effect

from that date. In respect of leasehold land, depreciation is

charged over the unexpired period of the lease. Commencing

from the date the land is put to use for commercial operation.

Intangible assets are amortised on a straight-line basis at rates

specified below :

Website development cost - 20.00 %

Cost of customer reservation system (including licensed

Software) - 16.67 %

Service & operating rights - 10.00 %

(f) Transactions in foreign exchange :

Transactions in foreign currencies are recorded at the

exchange rate prevailing on the date of the transaction.

In respect of integral foreign operations :

i) monetary items outstanding at the balance sheet date are

translated at the exchange rate prevailing at the balance



sheet date and the resultant difference is recognized as

income or expense.

ii) non-monetary items outstanding at the balance sheet date

are reported using the exchange rate at the date of the

transactions.

In respect of non-integral foreign operations :

Both monetary and non-monetary items are translated at

the closing rate and the resultant difference is accumulated in a

foreign currency translation reserve, until the disposal of the net

investment.

(g) Derivative instruments :

The company has an exposure to derivative contracts in the

nature of currency swaps which are in respect of some of the

underlying rupee borrowings. Exchange difference arising on

repayment/revaluation of such currency swaps are recognized as

income or expense in the period in which they arise.



THE INDIAN HOTELS COMPANY LIMITED

1. The auditors have audited the attached Balance sheet of

THE INDIAN HOTELS COMPANY LIMITED (“the company”) as

at 31st March, 2008, the profit and loss account and the

cash flow statement of the company for the year ended on

that date, both annexed thereto. These financial statements

are the responsibility of the company’s management. Their

responsibility is to express an opinion on these financial

statements based on our audit.

2. The auditors conducted our audit in accordance with the

auditing standards generally accepted in India. These

standards require that they plan and perform the audit to

obtain reasonable assurance about whether the financial

statements are free of material misstatements. An audit

includes examining, on a test basis, evidence supporting

the amounts and the disclosures in the financial statements.

An audit also includes assessing the accounting principles

used and the significant estimates made by the

management, as well as evaluating the overall financial

statement presentation. They believe that their audit

provides a reasonable basis for our opinion.

3. As required by the companies (Auditor’s report) Order, 2003

(CARO) issued by the Central Government in terms of



Section 227(4A) of the Companies Act, 1956. They 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 in

paragraph 3 above, we report as follows :

(a) They have obtained all the information and explanations

which, to the best of our knowledge and belief, were

necessary for the purposes of our audit;

(b) in their opinion, proper books of account, as required by

law, have been kept by the company, so far as it appears

from our examination of those books;

(c) the Balance sheet, the profit and loss account and the cash

flow statement, dealt with by this report, are in agreement

with the books of account;

(d) in their opinion, the balance sheet, the profit and loss

account and the cash flow statement, dealt with by this

report, are in compliance with the accounting standards

referred to in section 211(3C) of the companies Act, 1956;

(e) in their opinion and to the best of our information and

according to the explanations given to them the said

accounts 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;

(i) in the case of the balance sheet, of the state of affairs of the

company as at 31st March, 2008 ;

(ii) in the case of the profit and loss account, of the profit of the

company for the year ended on that date and



(iii) in the case of the cash flow statement, of the cash flows of

the company for the year ended on that date.

5. On the basis of the written representations received from

the directors as on 31st March, 2008, and taken on record by

the Board of Directors, none of the Directors is disqualified

as on 31st March, 2008 from being appointed as a director in

terms of section 274(1)(g) of the companies Act, 1956.



TO THE BOARD OF DIRECTORS OF

THE INDIAN HOTELS COMPANY LIMITED

ON THE CONSOLIDATED FINANCIAL STATEMENTS

1. The auditors have audited the attached consolidated

balance sheet of THE INDIAN HOTELS COMPANY LIMITED

(“the company”), its subsidiaries and jointly controlled

entities, (the company, its subsidiaries and jointly controlled

entities together constitute “the Group”) as at 31st March,

2008, the consolidated profit and loss account and the

consolidated cash flow statement of the group for the year

ended on that date, both annexed thereto. The consolidated

financial statements include investments in associates,

accounted for on the equity method, in accordance with

accounting standard 23 (Accounting for investments in

associates in consolidated financial statements) (AS 23) and

financial statements of the jointly controlled entities,

accounted for in accordance with accounting standard 27

(Financial reporting of interests in joint ventures) (AS 27), as

notified by the companies (Accounting standards) Rules,

2006. These financial statements are the responsibility of

the company’s management. Our responsibility is to

express an opinion on these consolidated financial

statements based on our audit.

2. The auditors conducted our audit in accordance with the

generally accepted auditing standards in India. These

standards require that we plan and perform the audit to

obtain reasonable assurance about whether the financial

statements are free of material misstatements. An audit



includes examining, on a test basis, evidence supporting

the amounts and the disclosures in the financial statements.

An audit also includes assessing the accounting principles

used and the significant estimates made by the

management, as well as evaluating the overall financial

statements presentation. They believe that our audit

provides a reasonable basis for our opinion.

3. (i) The auditors did not audit the financial statements of

fifteen subsidiaries and two jointly controlled entities, whose

financial statements reflect total assets (net) of Rs.

3,384.59 crores as at 31st March, 2008, total revenues of Rs.

937.40 crores and net cash flows amounting to Rs. 31.71

crores for the year then ended as considered in the

consolidated financial statements. They have also not

audited the accounts of any of the associates, which reflect

the Group’s share of profit (net) for the year amounting to

Rs. 64.18 crores. These financial statements 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 these subsidiaries, jointly

controlled entities and associates, is based solely on their

reports.

(ii) The consolidated financial statements include the

unaudited financial statements of two jointly controlled

entities, having total assets (net) of Rs. 91.11 crores as at

31st March, 2008, total revenues of Rs. 41.20 crores and

cash flows amounting to Rs. 7.15 crores for the year then

ended as considered in the consolidated financial



statements. The financial statements of these entities have

not been audited but have been certified by the

management.

4. (i) We report that the consolidated financial statements

have been prepared in accordance with the requirements of

accounting standard 21, (Consolidated financial

statements), As 23 and AS 27, as notified by the companies

(Accounting Standards) Rules, 2006 and on the basis of the

separate audited/un audited financial statements of the.



Fixed Deposits :

The company accepts/renews fresh deposits only from the

members of the company at a rate of 6.25% p.a. for a period of

three years with the minimum amount of the deposit being Rs.

25,000.

The outstanding amount of fixed deposits placed with the

company amounted to Rs. 3.38 crores (previous year Rs. 5.13

crores) including Rs. 0.30 crores (previous year rs. 0.73 crores),

which remained unclaimed by depositors as on March 31,2008.

Directors :

Mr. Anil P. Goel and Mr. Abhijit Mukerji were appointed as

additional directors and as whole time directors of the company

for a period of five years with effect from march 17, 2008. They

respectively hold office upto the date of the forthcoming annual

general meeting of the company. Taking into consideration their

knowledge and experience, the board commends their

appointment as whole-time directors of the company to the

members of the company. Member’s approval for their

appointment as directors and whole-time directors has been

sought in the notice convening the annual general meeting of the

company.



Mr. Raymond N. Bickson’s tenure as managing director ends

on July 18, 2008. The company has greatly benefited from his

expertise and international experience. In view of the same, it is

proposed to re-appoint Mr. Bickson as the managing director of

the company for a period of 5 years w.e.f. July 19, 2008. The

board commends his re-appointment as the managing director of

the company to the members of the company.

In accordance with the companies Act, 1956, and the

articles of association of the company, three of your directors,

viz., Mr. R. K. Krishna Kumar, Mr. Shapoor Mistry and Mr. K. B.

Dadiseth retire by rotation, and are eligible for re-appointment.

Corporate governance :

As required by clause 49 of the listing agreement with the

stock exchanges, the report on management discussion and

analysis, corporate governance as well as auditors’ certificate

regarding compliance of conditions of corporate governance.

Auditors :

M/s S. B. Billimoria & company, the retiring auditors, have

by their letter dated May 29, 2008 informed the company of their

decision not to seek re-appointment as joint auditors of the

company. The board of directors recommend the appointment of

M/s. Deloitte Haskins & sells and M/s. N. M. Raiji & company as

joint auditors. The members are requested to appoint M/s.

Deloitte Haskins & sells, chartered accountants, Mumbai and re-

appoint M/s. Raiji & Co. chartered accountants, Mumbai as joint



auditors for the current year and authorize the board of directors

to fix their remuneration.



Foreign exchange earnings and outgo :

As 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 the board of director) Rules, 1988, the

information relating to foreign exchange earnings and outgo is in

Note Nos. 18, 19, 20 & 21 of the notes the accounts.

Staff :

As required by section 217(2A) of the companies Act, 1956,

read with the companies (Particulars of employees) Rules, 1975,

a statement of information relating to the employees has been

given in the annexure to the report and forms a part of it.

The board desires to place on record its appreciation to all

employees of the company who during the year under review

with sustained dedicated effort enabled the company to deliver a

good all-round record performance.

Director’s responsibility statement

Pursuant to the provisions of section 217(2AA) of the

companies Act, 1956, the board of directors, based on the

representations received from the operating management,

hereby confirms that :

i. in the preparation of the annual accounts, the applicable

accounting standards have been followed and that there are

no material departures;

ii. it has in the selection of the accounting policies, conducted

the statutory auditors and has applied them consistently

and made judgements and estimates that are reasonable



and prudent, so as to give a true and fair view of the state

of affairs of the company as at March 31, 2008 and of the

profit of the company for that period;

iii. it has taken proper and sufficient care for the maintenance

of adequate accounting records in accordance with the

provisions of the act for safeguarding the assets of the

company and for preventing and detecting fraud and other

irregularities, to the best of its knowledge and ability. There

are however, inherent limitations, which should be

recognized while relying on any system of internal control

and records; and

iv. it has prepared the annual accounts on a going concern

basis.

Global compact :

As part of the Tata group, your company had signe dup to

promote the United nations “Global compact” which lays down

ten key principles to specifically address issues in the areas of

human rights, labour, corruption and the environment. Your

company continues to be an active member of global compact.

Your company annually submits a ‘Corporate Sustainability

Report’ detailing economic, environmental and social

performance.



Profit and loss account for the year ended 31st

March 2008

Previous year

Sc

he

dul

e

Rupee

s

crores

Rupee

s

crores

Rupee

s

crores

INCOME

Rooms, Restaurants,

Banquets and Other income

11 1,823.1

6

1,617.3

1

EXPENDITURE

Operating and General

Expenses

12 1,074.3

5

981.62

Depreciation 85.48 91.44

Interest (net) (Refer note 13,

page 98)

94.28 71.89

Total 1,254.1

1

1,144.9

5

Less : Unallocated

Expenditure during

construction period

transferred to fixed assets

11.42 2.28

1,242.6

9

1,142.6

7

PROFIT BEFORE TAX 580.47 474.64

Less : Provision for Tax

(Refer Note 4 (a), Page 94)

198.91 152.25

Less : Short provision of tax 4.10 -



of earlier years (Net)

PROFIT AFTER TAX 377.46 322.39

Add : Balance brought

forward from previous year

331.33 156.80

Amount available for

appropriation

708.79 479.19

Appropriation :

Interim dividend 114.54 -

Tax on interim dividend 19.47 -

Proposed dividend - 96.46

Tax on dividend - 16.40

Transfer to general reserve 38.00 35.00

Balance carried forward 536.78 331.33

708.79 479.19

Earnings per share – (In

Rupees)

Basic and Diluted (Refer

Note 32, page 112)

6.26 5.35

Face value per equity share –

(In Rupees)

1.00 1.00

The accompanying notes

form an integral part of the

profit and loss account

13/

14



PROFIT & LOSS ACCOUNT FOR THE YEAR

ENDED 31ST MARCH, 2008

Description 2006-07 2007-08

> Rooms, Restaurants

Banquet

& other 16173

1

100% 1283.1

6

100%

> Expenditure Operating &

General 981.62 60.69% 1074.3

5

58.93%

Depreciation 91.44 5.65% 85.48 4.69%

Interest (Net) 71.89 4.45% 94.28 5.17%

TOTAL 1144.9

5

70.79% 1254.1

1

68.79%

Less : Unallocated

Expenditure

During construction period

Transfer to fixed assets 2.28 0.14% 11.42 0.63%

NET BLOCK 1142.6

7

70.65% 1242.6

9

68.16%

Profit Before Tax 474.64 29.35% 580.47 31.79%

Less : Provision for Tax 152.25 9.41 % 198.91 10.91

%

Less : Short Provision for

Tax

Of earlier year - - 4.10 0.22 %

Profit After Tax 322.39 19.93% 377.46 20.70%



Add : Balance brought

forward

From previous year amount 156.80 9.70% 331.33 18.17%

Available for appropriation 479.19 29.63% 708.79 38.88%

Appreciation - - 114.54 6.28%

Interim Dividend - - 19.47 1.07%

Tax on it Interim Dividend - - - -

Tax on Dividend 16.40 1.01% - -

Proposed Dividend 94.46 5.841% - -

Transfer to General Res. 35.00 2.16% 38.00 2.08%

Balance Carried Forward 331.33 20.49% 536.78 29.44%

479.19 29.63% 708.79 38.88%

Earning per Share 5.35 0.33% 6.26 0.34%

Face value per equity share 1.00 0.06% 1.00 0.05%



Balance sheet as 31st March 2008

Previous year

Sc

he

dul

e

Rupee

s

crores

Rupee

s

crores

Rupee

s

crores

SOURCES OF FUNDS

Shareholder’s funds

Share capital 1 60.29 60.29

Share application money

(Refer Note 2, page 93)

19.97 -

Reserves and surplus 2 1,956.2

9

1,738.3

9

Total 2,036.5

5

1,798.6

8

Loan funds

Secured loans 3 755.58 774.36

Unsecured loans 4 378.60 167.54

Total 1,134.1

8

941.90

Long term trade deposits 23.63 15.28

Deferred tax liability (Refer

Note 4 (b), page 94)

137.86 135.40

3,332.2

2

2,891.2

6

APPLICATION OF FUNDS

Fixed assets 5



Gross block 2,072.1

6

2014.2

9

Less : Depreciation 700.56 654.24

Net block 1,371.6

0

1360.0

5

Capital work-in-progress 265.45 111.52

Investments 6 977.58 962.81

Long term deposits 7 585.55 403.90

Current assets, loans and

advances

8

Inventories 32.85 29.02

Sundry Debtors 138.41 127.20

Cash & Bank balances 74.43 67.75

Loans & advances 332.77 275.92

578.46 499.89

Less : Current liabilities and

provisions

9

Liabilities 401.14 291.54

Provisions 46.73 156.75

447.87 448.29

Net current assets 130.59 51.60

Miscellaneous Expenditure

(to the extent not adjusted

or written off)

10 1.45 1.38

3,332.2

2

2891.2

6

The accompanying notes

form an integral part of the

13/

14



balance sheet



BALANCE SHEET

Particulars

2008 2007

Rs % Rs %

SOURCES OF FUNDS

Shareholder's Funds

Share Capital 60.29 1.81 60.29 2.09

Share Application Money 19.97 0.60 - -

Reserve & Surplus

1956.2

9

58.7

1

1738.3

9

60.1

3

Loans Funds

Secured loans 755.58

22.6

7 774.36

26.7

8

Unsecured loans 378.60

11.3

6 167.54 5.79

Long term trade

deposited 23.60 0.71 15.28 0.53

Differed tax Liability 137.86 4.41 135.40 4.68

3332.2

2 100

2891.2

6 100



APPLICATION OF

FUNDS

Fixed Assets

1371.6

0

41.1

6

1360.0

5

47.0

4

Capital work in progress 256.45 7.97 111.52 3.86

Investments

9.77.5

8

28.3

4 962.81

33.3

0

Long term deposits 585.55

17.5

7 403.90

13.9

7

Current Assets, Loans &

Advances

Inventories 32.85 0.99 29.02 1.00

Sundry debtors 138.41 4.15 127.20 4.40

Cash & Bank balances 74.43 2.23 67.75 2.34

Loan & Advances 332.77 9.99 275.92 9.54

Miscellaneous exp. Write-

off 1.45 0.01 1.38 0.05

Less

(-) current Liabilities &

provision 447.87

13.4

1 448.29

15.5

0

3332.2

2 100

2891.2

6 100



# Meaning :

Cash flow statement is additional information to user

financial statement cash statement is a summary of cash receipt

and cash payment and net change in resulting from operating,

financing & investing activities of an enterprise during the given

period. These statement is on of the tools for assessing the

liquidity & solvency of the enterprise.

# Importance of Cash Flow Statements :

1. If the finance manager has the cleat idea of cash receipt &

payment cash resources can be efficiency managed. If the

cash payment are planned at a time when enough cash in

flow is likely. It is possible to manage business with

minimum of working capital.

2. useful for financial management of dividend payment of

long term loans, purchases of machines or equipments etc.

if it has good idea about the timing when enough cash will

be on hand.



3. useful for control : The historical cash flow statement

prepared for last year is useful for comparing the degree of

cash budget and point of different may be located.

4. easy of obtaining funds : By comparing of figures cash flow

statement and cash budget the cash planning and content

becomes more effective liabilities are easily raise as and

when they market this position improves and raise the

prestige of the firm in the market.



Cash flow statement for the year ended 31st

March 2008

Previous year

Rupe

es

crore

s

Rupees

crores

Rupees

crores

Rupees

crores

Cash flow from operating

activities

Net profit before tax 580.47

Adjustments for :

Depreciation 85.48 91.44

Amortisation of VRS

expenditure

0.51 0.51

Profit on sale of investments - (24.75)

Loss / (profit) on sale of

assets

5.98 (0.19)

Provision for doubtful debts

and advances

(1.26) 1.95

Dividend income (19.98

)

(32.78)

Interest (Net) 94.28 71.89

Unrealised exchange gain on

borrowings

(14.23

)

(9.80)

Provision for diminution in

value of investments written

back

(0.25) -



Provision for loyalty

programmes

2.14 2.01

Provision for employee

benefits

0.93 9.67

153.60 109.95

Cash operating profit before

working capital changes

734.07 584.59

Adjustments for :

Trade and other receivables (19.56

)

(19.62)

Inventories (3.83) (1.74)

Trade payables (29.24

)

69.83

(52.63) 48.47

Cash generated from

operating activities

681.44 633.06

Direct taxes paid (207.08) (112.57)

Net cash from operating

activities

474.36 520.49

Cash flow from investing

activities

Purchase of fixed assets (259.0

0)

(197.45)

Sale of fixed assets 2.06 7.26

Purchase of investments

(including share application

money)

(64.12

)

(584.62)

Sale of investments - 30.34



Interest received 7.02 26.98

Dividend received 19.98 32.78

Long term deposits placed

with subsidiary

(179.0

2)

-

Long term deposits placed

with others

(27.74

)

-

Long term deposits refunded

y other companies

0.25 -

Loans repaid by subsidiaries 9.17 324.00

(Loans to) / Loans repaid by

other companies (net)

(1.57) 5.83

(492.97) (354.88)

Net cash used to

investing activities

Cash flow from financing

activities

Share application money

collected

19.97 -

Debenture application

money collected

3.88 -

Debenture issue costs (0.69) (0.74)

Interest Paid (101.0

8)

(100.25)

Repayment of long term

loans and debentures

(352.7

5)

(381.45)

Proceeds of long term loans

and debentures

422.7

3

256.43

Short term loans raised / 117.5 82.03



(Repaid) (net) 7

Long term trade deposits

raised/(Repaid) (net)

8.34 (21.22)

Dividend paid (Including tax

on dividend)

(112.6

4)

(95.10)

Net cash used in

financing activities

5.33 (260.30)

Net increase / (Decrease) in

cash and cash equivalents

(13.28) (94.69)

Cash and cash equivalents –

opening – 1st April – (Refer

note 9 (b). page 96)

56.38 115.24

Cash and Cash equivalent

acquired on amalgamation

- 35.83

Cash and cash equivalents –

closing – 31st March – (Refer

note 9 (b). page 96)

43.10 56.38



After analyzing the published annual report of “Taj

Hotel Ltd.”. I present a project report as the requirement of my

study from which I conclude my report as below;

“Taj Hotels Company Limited” is one of the most

repeated companies. The overall performance of the company is

good. Some of the ratio shows very unsatisfactory position of

good as compared to previous year. The turn over ratio debt

equity fixed assets turn over ratio of the firm liquidity ratio shows

a quite good liquid position of company.

Company shows ideals funds in the company so the

company must take necessary steps about this funds.

Although the world is facing slowdown in economy this

company has been able to maintain high profit through there is a

moderate fluctuation and high dividend to the rate to its share

holders from first level of analysis.


105 taj

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