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Sayaji Hotels Ltd.

BSE: 523710 Sector: Services
BSE 00:00 | 15 Feb 274.00 12.75






NSE 05:30 | 01 Jan Sayaji Hotels Ltd
OPEN 273.00
52-Week high 329.00
52-Week low 218.85
P/E 177.92
Mkt Cap.(Rs cr) 480
Buy Price 248.50
Buy Qty 10.00
Sell Price 272.50
Sell Qty 450.00
OPEN 273.00
CLOSE 261.25
52-Week high 329.00
52-Week low 218.85
P/E 177.92
Mkt Cap.(Rs cr) 480
Buy Price 248.50
Buy Qty 10.00
Sell Price 272.50
Sell Qty 450.00

Sayaji Hotels Ltd. (SAYAJIHOTL) - Director Report

Company director report



The Directors have pleasure in presenting their 35th Annual Report of your Companytogether with its Audited consolidated and standalone Financial Statements for thefinancial year ended March 31 2018.

Pursuant to the notification dated February 16 2015 issued by the Ministry ofCorporate Affairs the Company has adopted the Indian Accounting Standards (''Ind AS'')notified under the Companies (Indian Accounting Standards) Rules 2015 with effect fromApril 1 2017. As such financial statements for the previous year ended as at March 312017 have been restated to make comparable to Ind AS.


During the year under review on standalone basis the total revenue in the year 2018was increased by 21.85 % (from Rs.15917.79 Lakhs in 2017 to Rs.19396.85 Lakhs in 2018).This was mainly due to opening of the new hotel unit and good performance of the existinghotels. The Losses After Tax is also decreased by 41% (from Rs. 614.75 Lakhs to Rs. 362.48Lakhs). On consolidated level the total revenue was increased by 21.18% (from Rs. 18045.67Lakhs to Rs. 21869.25 Lakhs). The loss after tax is also decreased by 71.36 % (from. Rs.900.02 Lakhs to Rs. 257.78 Lakhs).


(Rs. In Lakhs Except EPS)

Standalone (Rs. in Lakhs) Consolidated (Rs. In Lakhs)
Particulars Year ended March 31 2018 Year ended March 31 2017 Year ended March 31 2018 Year ended March 31 2017
Total income from operation(net) 19396.85 15917.79 21869.25 18045.67
Net Profit / (Loss) for the period (before Tax
Exceptional and/or Extraordinary items) (283.75) (719.14) (257.78) (900.02)
Share of Profit / (Loss) of associate - - 193.94 549.15
Net Profit / (Loss) for the period before tax
(after Exceptional and/or Extraordinary items) (283.75) (719.14) (63.84) (350.87)
Net Profit / (Loss) for the period after tax
(after Exceptional and/or Extraordinary items) (362.85) (614.36) (389.13) (305.79)
Total Comprehensive Income for the period
[Comprising Profit / (Loss) for the period (after tax)
and Other Comprehensive Income (after tax)] (362.48) (614.75) (365.36) (299.75)
Equity Share Capital 1751.80 1751.80 1751.80 1751.80
Earnings Per Share
Basic: (2.76) (4.19) (2.91) (2.43)
Diluted: (2.76) (4.19) (2.91) (2.43)


In view of the accumulated losses as well as the Company is in the process to expandits reach in the various part of the Country through owned hotel management modeloperating lease etc. and said expansion may demand substantial working capital infusionhence the board has not recommended dividend for the financial year 2017-18 (Previous year2016-17 Nil).


The Registered office of the Company is shifting from the State of Gujarat to the Stateof Tamilnadu (within the jurisdiction of the Registrar of Companies Chennai) vide theorder dated June 29th 2018 of the Regional Director (North Western Region) Ahmedabad.


The authorized share capital of the Company is Rs. 4000.00 Lakhs. The paid up EquityShare Capital is Rs.1751.80Lakhs and Preference Share Capital is Rs. 1000.00 Lakhs.Duringthe year under review the Company has not issued shares with differential voting rightnor granted stock option not sweat equity.

The Company's equity shares are listed with the BSE Ltd. and available for trading atthe platform of BSE Ltd.


Cash and cash equivalent as at 31st March 2018 was Rs. 1214.95 Lakhs. The Companycontinues to focus on judicious management of its working capital receivables andinventories. The working capital parameters were kept under strict check throughcontinuous monitoring.


In terms of the provisions of Sections 73 and 74 of the Companies Act 2013 read withCompanies (Acceptance of Deposits by Companies) Rules 2014 the Company had no opening orclosing balances and during the year under review the Company has also not accepted anypublic deposits and as such no amount of principal or interest was outstanding as onMarch 31 2018.


The Company has disclosed the full particulars of the loans given investments made orguarantees or security provided as required under section 186 of the Companies Act 2013and Regulation 34(3) and Schedule V of the SEBI (LODR) Regulations 2015 in Notes to thefinancial statements attached with this Board Report. However the Company is coveredunder the infrastructure section therefore section 186 of the Companies Act 2013 is notapplicable as such.


During the year under review Rs. (1007.21 Lakhs)are proposed to be carried in thefinancial statements under the head of the reserves and surplus.(Previous year Rs. (644.36Lakhs)


During the year the Company has launched one more 4 Star hotel in the Vadodara Cityunder the ‘Sayaji' brand. The Hotel has 137 rooms 2 restaurants and multiple banquetfacilities. The hotel received fair response from the city and surrounding area. Thecurrent year will be its first full fledge year of operation.

The existing hotel at Vadodara city was re-branded in the name of ‘Effotel'. Atpresent that hotel is in the process of the complete renovation and may re-open bySeptember 2018. l Raipur

Last year the Company started operation into the Raipur City. The hotel property isreceiving good response and ramping up. l Management Contract/Lease Model

The Company is focusing to open more and more hotel into the tier 2 cities under themanagement contract/lease model. This strategy will help the Company in two ways firstlythe brand of the Company will easily expand and secondly there will be huge saving onaccount of capital expenditure and incidental finance cost.


Tourism has now become a significant industry in India. It is a sun rise industry anemployment generator a significant source of foreign exchange for the country. Tourism inIndia is the third largest foreign exchange earner of the country. The booming tourismindustry has had a cascading effect on the hospitality sector with an increase in theoccupancy ratios and average room rates.

India is a large market for travel and tourism. It offers a diverse portfolio of nichetourism products - cruises adventure medical wellness sports MICE eco-tourism filmrural and religious tourism. India has been recognized as a destination for spiritualtourism for domestic and international tourists.

Total contribution by travel and tourism sector to India's GDP is expected to increasefrom Rs 15.24 trillion (US$ 234.03 billion) in

2017 to Rs 32.05 trillion (US$ 492.21 billion) in 2028. India ranked 7th among 184countries in terms of travel & tourism's total contribution to GDP in 2017. Travel andtourism is the third largest foreign exchange earner for India. Foreign exchange earnings(FEEs) in March 2018 were US$ 2.66 billion. The number of Foreign Tourist Arrivals (FTAs)in March 2018 was 1.03 million. A sum of US$ 27.693 billion was earned under foreignexchange through tourism during calendar year 2017. Total employment in the sector isexpected to rise to 52.3 million jobs by 2028. During calendar year 2017 10.177 millionforeign tourists have arrived in India. The Government of India has set a target of 20million foreign tourist arrivals (FTAs) by 2020 and double the foreign exchange earningsas well.

The launch of several branding and marketing initiatives by the Government of Indiasuch as ‘Incredible India!' and ‘Athiti Devo Bhava' has provided a focusedimpetus to growth. The Indian government has also released a fresh category of visa - themedical visa or M visa to encourage medical tourism in the country. Incredible India 2.0campaign was launched in September 2017. The Government of India is working to achieve 1%share in world's international tourist arrivals by 2020 and 2 % share by 2025.


New Visa Reforms Electronic tourist authorizations known as E Tourist Visa launched by the Government of India have resulted in increase in number of tourist visa issued in the country with arrivals through e-visa increasing 57.2 per cent to 1.697 million during CY 2017. During CY 2018 (up to February) arrivals through e-visa increased 60.7 per cent year-on-year to 516000.
Contribution to GDP above worldaverage India ranked 3rd among 184 countries in terms of travel & tourism's total contribution to GDP in 2016. India's foreign exchange earnings (FEEs) from tourism increased by 20.8 per cent during CY 2017 to reach US$ 27.693 billion. During CY 2018 (up to February) FEEs from tourism increased 16.3 per cent year-on-year to US$ 5.49 billion.
Creating higher employment The travel & tourism sector in India accounted for 9.3 per cent of the total employment opportunities generated in the country in 2016 providing employment to around 40.3 million people during the same year. The number is expected to rise by 2 per cent annum to 46.42 million jobs by 2026.
Higher investments Travel & tourism's contribution to capital investment is projected to grow 6.3 per cent per annum during 2016 26 higher than the global average of 4.5 per cent
Increasing visitor exports Contribution of visitor exports to total exports is estimated to increase 7.2 per cent per annum during 2016 2026 compared to the world average of 4.3 per cent

Source: World Travel & Tourism Council's (WTTC's) Economic Impact 2017 Ministry ofTourism


Accommodation & Catering Accommodation could be hotels & motels apartments camps guest houses lodge bed & breakfast establishments house boats resorts cabins & hostels. In addition tourists also require catering facilities which includes include hotels local restaurants roadside joints cafeterias & retail outlets serving food & beverages.
Transportation Comprises airline companies cruise services railways car rentals & more. A tourist's choice of transport would depend on the travel budget destination time purpose of the tour & convenience to the point of destination.
Tourism and Hospitality Attractions Another major component of the travel & tourism industry is ‘attractions' such as theme parks & natural attractions including scenic locations cultural & educational attractions monuments events & medical social or professional causes.
Travel Agents A fragmented sector with a number of independent travel agents & many online businesses. They also sell associated products such as insurance car hire & currency exchange.
Tour Operators Offer customized tours including travel accommodation & sightseeing


(A) l Tourism in India accounts for 9.6 per cent of the GDP & is the 3rd largestforeign exchange earner for the country. l The tourism & hospitality sector's directcontribution to GDP in 2016 was US$ 71.7 billion. This is expected to rise by 6.9 percent to US$ 76.6 billion in 2017.

l During 2006 17E direct contribution of tourism & hospitality to GDP is estimatedto have registered a CAGR of 14.05 per cent l The direct contribution of travel &tourism to GDP is expected to reach US$ 148.2 billion by 2027.

(B) l The sector's total contribution to GDP stood at US$ 208.9 billion (9.6 per centof GDP) in 2016 and is forecast to rise by 6.7 per cent in 2017 and to rise by 6.7 percent pa to Rs

28491.8 billion (US$ 424.5 billion) 10 per cent of GDP in 2027. l In February 2018the country earned foreign exchange of around US$ 2.706 billion from the tourism sector.


(A) l In CY2017 foreign tourist arrival in India stood at 10.177 million and reached2.12 million in CY 2018 (up to February) l Foreign tourist arrivals into the country isforecast to increase at a CAGR of 7.1 per cent during 2005 25 l India is expected toattract 17.3 million international tourist arrivals by 2027. l Growth in tourist arrivalshas been due to flexible government policies developed rail & road infrastructureease in availability of e-visas to foreign tourists. l The number of Foreign TouristArrivals (FTAs) in February 2018 were 1.05 million as compared to FTAs of 956000 inFebruary 2018 and 849000 lakh in February 2016 l The growth rate in FTAs in February 2018over February 2017 was 10.1 per cent. l The Government of India has set a target of 20million foreign tourist arrivals (FTAs) by 2020 and double the foreign exchange earningsas well. l The Government of India is working to achieve 1 per cent share in world'sinternational tourist arrivals by 2020 and 2 per cent share by 2025.

(B) l During 2017 India has earned foreign exchange of US$ 27.693 billion fromtourism. l Foreign exchange earnings from tourism in India witnessed growth at a CAGR of10.4 per cent during 2006-17 l In FY16 foreign exchange earnings from the tourism sectorstood at US$23.15 billion l Foreign exchange earnings (FEEs) in February 2018 were US$2.706 billion as compared to US$ 2.354 billion in February 2017 and US$ 2.001 billion inFebruary 2016. l The year-on-year growth rate in FEEs in February 2018 over February 2017was 15 per cent compared to 17.6 per cent in February 2017 to January 2016

Domestic Consumers to lead Growth l Domestic travel revenues are estimated at US$183.48 billion in 2016 are anticipated to further increase to US$ 203.3 billion by 2026. lRevenues earned from foreign visitors are estimated at US$ 25.02 billion in 2016 & areprojected to further increase to US$ 40.11 billion by 2026. l Indian travelers booked 52per cent more trips in the 3rd quarter of 2016 as compared to last year. l Out of totalIndian travelers in 201617 per cent people were in the age bracket 18-24 years comparedto 12 per cent in the previous year which was mainly due to the increasing usage of smartphones by the young travelers. l India's state-of-the-art high-speed 15 coach train TejasExpress made its 1st run on 22nd May 2017 from Mumbai to North Goa. It covered a distanceof 579 kms in 8.5 hours. The train has 2 classes - Executive Chair Car & Chair Car. Itis equipped with facilities like automatic doors secured gangways Wi-Fi LCD screensmagazines tea-coffee vending machines bio-toilets etc. At the time of booking thepassengers will have a choice to opt for on-board catering services which will not becompulsory like in Shatabdi.

Rising Revenues from Leisure and Business Segments l Share of revenues from leisuretravel to the total tourism revenue stood around 94.6 per cent in 2016. l Leisure travelspending reached Rs 12079 billion (US$ 179.7 billion) in 2016 and is expected to reach Rs12910 billion (US$

196.41) billion in 2017 and US$ 386.3 billion by 2027. l Business travel revenues wereRs 689 billion (US$ 10.25 billion) in 2016 & are projected to increase to Rs 726.6billion (US$ 11.1) billion by 2017 and US$ 23.3 billion by 2027.

Government Initiatives

1. Swadesh Darshan- l Based on specific themes government has identified 13 circuitswhich includes Krishna Circuit Buddhist Circuit Himalayan Circuit North East Circuit& Coastal Circuit. l Tajmahotsav: the 10 day celebration provide a platform toexperience India's arts craft culture cuisine dance & music. l Under Budget2018-19 the government allotted Rs 1250 crore (US$193.08 million) for Integrateddevelopment of tourist circuits under Swadesh Darshan and Pilgrimage Rejuvenation andSpiritual Augmentation Drive (PRASAD).

2. Pilgrimage Rejuvenation and Spiritual Augmentation Drive (PRASAD)- l NationalMission on Pilgrimage Rejuvenation & Spiritual Augmentation was implemented by theMinistry for enhancing the facilities provided & infrastructure at pilgrimage centresof all cities l In March 2018 total amount sanctioned by the Ministry of Tourism for thisscheme was Rs 5638.87 crore (US$ 868.87 million) since 2014-15.

3. National Tourism Policy 2015- l Formulation of National Tourism Policy 2015 thatwould encourage the citizens of India to explore their own country as well as position thecountry as a ‘Must See' destination for global travelers. l Under Union Budget 2017USD14.87 million was allocated for promotion & publicity of various programmes &schemes of the Tourism ministry.

4. Tourism Projects- l Under Union Budget 2017-18 the government allocated USD15.25million for development of Umiam Lake-Ulum Sohpetbneng-Mawdiangdiang under North EastCircuit of Swadesh Darshan Scheme & USD11.53 million for development of Buddhist sitesof MP (Mandsaur- Dhar- Sanchi- Satna- Rewa)

Source : Union Budget 2015 16 Aranca Research


1. Special Boards - The Ministry has set up a Hospitality Development & PromotionBoard which will monitor & facilitate hotel project clearances/approvals.

2. Tourist Police - In March 2018 Ministry of Tourism initiated StateGovernments/Union Territory administrations of India to deploy Tourist Police.

3. Tax Incentives - An investment-linked deduction under Section 35 AD of the IncomeTax Act is in place for establishing new hotels in the 2-star category and above acrossIndia thus permitting a 100 per cent deduction in respect of the whole or any expenditureof a capital nature.

4. Safety and Security Initiatives- l Ministry of Tourism launched a 24x7 Toll FreeMultilingual Tourist Information-Helpline on 1800111363 or 1363 in 12 languages which willprovide information relating to travel in India. l Ministry of Tourism issued guidelineson Safety and Security for States/UTs along wit h tips for travelers. l Launched SocialMedia Awareness Campaign in the spirit of ‘Atithidevo Bhava' to develop importance ofgood conduct and behavior towards tourists. l Initiative to conduct constant dialogue withState/UTs for drawing ideas for development and promotion of tourism.

5. Incentives from Ministry of Tourism-

Assistance in large revenue-generating projects.

Support to Public Private Partnerships in infrastructure development such as viabilitygap funding.

Schemes for capacity-building of service providers.

6. Project Mausam-

Under ‘Project Mausam' the Government of India has proposed to establish crosscultural linkages & to revive historic maritime cultural & economic ties with 39Indian Ocean countries. In 2015 Government of India linked China Silk Road project withProject Mausam.

7. E Tourist Visa-

Since April 2017 the facility has been made available to citizen 161 countries.

Year-on-year growth of 48.3 per cent was registered during the month of December 2017as a total of 241000 tourists arrived in India on E Tourist Visas

Foreigners travelling to India on e-tourist visa will receive a BSNL SIM card whichwill be pre activated and loaded with talktime and data.

Source : World Travel & Tourism Council Aranca Research


Your Company holds 100% equity as well as preference share capital in SayajiHousekeeping Services Limited 52.37%equity share capital in Aries Hotels Private Limitedand 51.67% in Malwa Hospitality Private Limited. In May 2018 the Company has incorporated3 new public limited companies as its wholly owned subsidiary i.e. (a) Sayaji HotelsManagement Limited (b) Sayaji Hotels (Pune) Limited (c) Sayaji Hotels (Vadodara) Limited.


Our people are the key to truly leveraging the potential of the Company's growth. Thecontinuous zeal and commitment of our people powers and we nurture this with trainingmotivation leadership development and performance rewards. The Company's Corporate HumanResource Policy sets a robust framework for people management. Apart from this WhistleBlower Policy Protection of Women's Rights at Workplace Policy and code of conduct forprotection of human rights.

Sayaji is a merit-based organisation and discrimination of any form based on castereligion region gender or physical disability is not permitted.


The Company has zero tolerance for sexual harassment at its workplace and in line withthe provision of the Sexual Harassment of Women at Workplace (Prevention Prohibition andRedressal)

Act2013 and the Company has formulated a policy on ‘Protection of Women's Rightsat Workplace' as per the provisions of the Sexual Harassment of Women at Workplace(Prevention Prohibition & Redressal) Act 2013. This has been widely disseminated.There were no cases of sexual harassment complaints received by the Company in thefinancial year 2017-18.


The Board of Directors formulated the Corporate Social Responsibility (CSR) Policy foryour Company pursuant to the provisions of Section 135 of the Companies Act 2013 readwith the Companies (Corporate Social Responsibility Policy) Rules 2014 (including anystatutory modification(s) or re-enactment(s) thereof for the time being in force) on therecommendations of the CSR Committee. The CSR Policy outlines the CSR vision of yourCompany which is based on embedded tenets of trust fairness and care. As the average netprofit of the Company for last 3 years is negative hence there is no liability on theCompany to incur expenditure on CSR activities as prescribed u/s 135 and Schedule VII ofthe Companies Act 2013 hence is not required to provide particulars of CSR.

CSR Policy has also been approved by the Board and placed on the Company's website at Corporate_Social_Responsibility_Policy.pdf


In risk management and monitoring the probability of risk is estimated with availabledata/ information and appropriate risk treatments are worked out in the following areas:

1. Economic Environment and Market conditions

The hospitality industry is prone to impacts due to fluctuations in the economy causedby changes in global and domestic economies changes in local market conditions excesshotel room supply reduced international or local demand for hotel rooms and associatedservices competition in the industry government policies and regulations fluctuationsin interest rates and foreign exchange rates and other social factors. Since demand forhotels is affected by world economic growth a global recession could also lead to adownturn in the hotel industry.

2. Revenue Concentration

High concentration in any single business segment exposes SHL to the risks inherent inthat segment. Prudent norms are being adopted based on which we can monitor and preventundesirable concentration in a geography industry or customer. The quest for diversifiedactivities within the existing realm of over all management after due consideration of theadvantages and disadvantages of each activity is consistent with company policy ofincreasing business volumes with minimum exposure to undue risks. Concentration of revenuefrom any particular brand or segment of industry is sought to be minimized over the longterm by careful extension into other activities particularly in areas SHL has some basicadvantage.

3. Inflation and Cost Structure

The industry in general has a high operating leverage. At organizational level costoptimization and cost reduction initiatives are implemented and are closely monitored. SHLcontrols costs through budgetary mechanism and its review against actual performance withthe key objective of aligning them to the financial budgets/model. The focus on theseinitiatives will further inculcate across the organization the importance of costreduction and control.

4. Financial Reporting Risks

Changing laws regulations and standards relating to accounting corporate governanceand public disclosure can create uncertainty for companies. These new or changed lawsregulations and standards may lack specificity and are subject to varying interpretations.Their application in practice may evolve over time as new guidance is provided byregulatory and governing bodies. This could result in continuing uncertainty regardingcompliance matters and higher costs of compliance as a result of ongoing revisions to suchcorporate governance standards.

SHL is committed to maintaining high standards of compliances corporate governance andpublic disclosure and complying with evolving laws regulations and standards in thisregard would further help us address these issues.

5. Risk of Corporate accounting fraud:

Accounting fraud or corporate accounting fraud are business scandals arising out ofmisusing or misdirecting of funds overstating revenues understating expenses etc. SHL tomitigate this risk by: l Understanding the applicable laws and regulations l Conductingrisk assessments l Deploying a strategy and process for implementing the new controls lAdhering to internal control practices that prevent collusion and concentration ofauthority l Employing mechanisms for multiple authorization of key transactions with crosschecks l Creating a favorable atmosphere for internal auditors in reporting andhighlighting any instances of even minor non-adherence to procedures and manuals and ahost of other steps throughout the organization

6. Legal Risk-

Legal risk is the risk in which SHL is exposed to legal action. As SHL is governed byvarious laws and SHL has to do its business within four walls of law where SHL is exposedto legal risk exposure. Focus is to be given on evaluating the risks involved in acontract ascertaining our responsibilities under the applicable law of the contractrestricting our liabilities under the contract and covering the risks involved so thatadherence to all contractual commitments can be ensured.

Management places and encourages its employees to place full reliance on professionalguidance and opinion and discuss impact of all laws and regulations to ensure company'stotal compliance. Advisories and suggestions from professional agencies and industrybodies chambers of commerce etc. are carefully studied and acted upon where relevant.

7. Compliance with Local Laws

SHL is subject to additional risks related to complying with a wide variety of nationaland local laws restrictions. SHL strives to place robust process with the help ofconsultants to mitigate and minimize such compliance risk under municipal laws of theland.

8. Environmental Risk Management-

SHL endeavors to protect the environment in all its activities as a socialresponsibility and strives to avoid any situation causing a risk to the environment andcommunity at large.

9. Human Resource Management

SHL's Human Resources (HR) Department add value to all its Units and associatecompanies by ensuring that the right person is assigned to the right job and that theygrow and contribute towards organizational excellence. Our growth has been driven by ourability to attract good quality talent and effectively engage them in right jobs.

Risk in matters of human resources are sought to be minimized and contained byfollowing a policy of providing equal opportunity to every employee inculcate in them asense of belonging and commitment and also effectively train them in spheres other thantheir own specialization. Employees are encouraged to make suggestions on innovationscost saving procedures free exchange of other positive ideas relating to hospitalityindustry etc. It is believed that a satisfied and committed employee will give his bestand create an atmosphere that cannot be conducive to risk exposure.


Sayaji manages monitors and reports on the principal risks and uncertainties that canimpact its ability to achieve its strategic objectives. The Company's risk managementframework encompasses internal control in an integrated manner and is tailored to thespecific Reliance segments businesses and functions. It takes into account variousfactors such as the size and nature of the inherent risks and the regulatory environmentof the individual business segment or operating company.

The Sayaji Hotel management systems organizational structures processes standardscode of conduct and values and behaviors together govern how Sayaji conducts its businessand manages associated risks.

Sayaji's risk management framework is designed to be a simple consistent and clearframework for managing and reporting risks from the Group's operations to the Board. Theframework and related processes seek to avoidincidents and maximize business outcomes byallowingmanagement to: l Understand the risk environment and assess the specific risks andpotential exposure for Reliance. l Determine how to deal best with these risks to manageoverall potential exposure. l Manage the identified risks in appropriate ways. l Monitorand seek assurance of the effectiveness ofthe management of these risks and intervene forimprovement where necessary. l Report up the management chain to the board on a periodicbasis about how risks are being managed monitored assured and the improvements that arebeing made. l Businesses are required to confirm periodically that all relevant risks havebeen identified assessed evaluated and that appropriate mitigation systems have beenimplemented. The Company has a well established risk management process and framework forall the hotels and managed properties across India and backed by strong internal controlsystem.


Your Company believes that internal control is a necessary adjunct of the principle ofgovernance that freedom of management should be exercised within a framework ofappropriate checks and balances. Your Company remains committed to ensuring an effectiveinternal control environment that provides assurance and comfort on orderly and efficientconduct of operations security of assets prevention and detection of frauds / errorsaccuracy and completeness of accounting records and the timely preparation of reliablefinancial information.

Your Company's independent and robust Internal Audit processes provide assurance on theadequacy and effectiveness of internal controls compliance with operating systemsinternal policies and regulatory requirements.

The Internal Audit function consisting of an outsourced professional firm is resourcedto deliver high standards audit assurances.

The Audit Committee of your Board met five times during the year. The Terms ofReference of the Audit Committee included reviewing the adequacy and effectiveness of theinternal control environment monitoring implementation of the action plans emerging outof Internal Audit findings including those relating to strengthening of your Company'srisk management systems and discharge of statutory mandates.


The business is on a growth trajectory and has started sailing through thetransformation phase. To keep abreast with the growing needs of the business the HR teamhas been holding the baton for achieving excellence by being the frontrunner in variousinitiatives. In order to effectively percolate the transformation plan and managementexpectations regular town hall sessions are conducted at various locations with theSenior Management. This has helped in enhancing the employees' morale and collaborativespirit.

To realise the vision HR function of the business is ably supporting the building ofcapability and capacity towards which a multi-pronged strategy has been developed anddeployed. In particular the HR team has been at the forefront of the company-widecapability building initiative. Further HR policies & practices have been aligned toachieve an efficient delivery model and meet dynamic business requirements. The companyhas total number of permanent employees on roll as 31st March 2018 was2313 across all itsunits.


The Company's commitment towards providing a healthy and safe work environment to itsemployees contractors and all the visitors forms the foundation of its safety processes.Sayaji's ultimate goal is to establish a zero accident work environment. A fully equippedand well-qualified organisation is in place at all locations providing necessarygovernance documentation and healthy and safety assurance. A Hotel management team ofqualified specialists provides recommendations and the action plan is monitored through acomprehensive and robust tracking system to ensure complete adoptability of the plan.Delivering safe compliant and reliable operations leads to a sustainable competitiveadvantage. Terms of reference of health safety and environment inter alia include thefollowing-l Monitoring and ensuring the highest standards of environmental health andsafety norms l Ensuring compliance with applicable pollution and environmental laws at theCompany's works / factories / locations by putting in place effective systems in thisregard and reviewing the same periodically. l Reviewing as the Committee deemsappropriate the Company's health safety and environment related policy and makingrecommendations as necessary. l Reviewing the Company's performance on health safety andenvironment related matters and suggesting improvements as the Committee may deemnecessary. l Carry out any other function as is mandated by the Board from time to time.


As on 31st March 2018 the Company has 3 Subsidiaries and 1 Associate Company. Duringthe year under review there was no change in the nature of businesses of Subsidiaries.

Pursuant to the provisions of Section 129(3) of the Act read with Rule 5 of theCompanies (Accounts) Rules 2014 a statement containing salient features of the financialstatements of the Company's subsidiaries and Associates. A statement containing salientfeatures of the financial statements of the subsidiary/associate companies is alsoincluded in the Annual Report as attached in Annexure - 6.

Pursuant to the provisions of Section 136(1) of the Act the financial statements ofthe Company consolidated financial statements along with relevant documents and separateaudited financial statements in respect of the subsidiaries are available on the websiteof the Company

Shareholders interested in obtaining a copy of the audited annual accounts of thesubsidiary companies may write to the Company Secretary at the Company's Registered Officeor e-mail to


The Board of Directors has an optimum combination of executive and non-executiveindependent directors including one women director.According to the requirement of theCompanies Act 2013 and the SEBI (LODR) Regulations 2015. As on 31st March 2018 yourBoard has following directors and key managerial personals:

S.No. Name Date of Appointment Designation
1. Mr. Thottapuly Narayanan Unni 31/01/2002 Independent Director
2. Mr. Sanjay Ahuja 01/02/2012 Nominee Director (of TFCI)
3. Mr. Raoof Razak Dhanani 14/11/2013 Managing Director
4. Mrs. Suchitra Dhanani 06/02/2014 Whole Time Director
5. Mr. Abhay Chintaman Chaudhari 14/02/2017 Independent Director
6. Mr. Kayum Dhanani 30/11/2012 Director
7. Mr. Pradeep Goyal 06/02/2014 Independent Director
8. Mr. Sandesh Khandelwal 06/02/2014 Chief Financial officer
9. Mr. Amit Sarraf 26/09/2011 Company Secretary


During the year under review there were no changes done in the constitution of theBoard.


As on March 31st 2018 Your Company has following Independent Directors:

S.No Name DIN Date of Appointment
1. Mr. T.N. Unni 00079237 31/01/2002
2. Mr. Pradeep Goyal 02798770 06/02/2014
3. Abhay Chintaman Chaudhari 06726836 14/02/2017

The Company has received Declarations of Independence as stipulated under Section149(7) of the Companies Act 2013 from Independent Directors confirming that he is notdisqualified from appointing/continuing as Independent Director.


In accordance with the provisions of Section 152(6) of the Companies Act 2013 and interms of Articles of Association of the Company Mr. Raoof Razak Dhanani is liable toretire by rotation at the ensuing Annual General Meeting and being eligible offerthemselves for re-appointment. The Board recommends their appointment.

The resolutions seeking approval of the members for the reappointment of Mr. RaoofRazak Dhanani have been incorporated in the Notice of the Annual General Meeting of theCompany.


The term of 5 years of the existing independent directors Mr. T.N.

Unni and Mr. Pradeep Goyal is being completed on 31st March 2019. The Nomination andRemuneration Committee of the Board has considered their significant contribution in thegrowth of the Company and has proposed their re-appointment for a second term of 5 yearsw.e.f. 1st April 2019 to 31st March 2024 subject to the approval of the members by wayof special resolution. Further that the age of Mr. T.N.Unni is crossed the age limit of 75years therefore he can be re-appointed by way of the special resolution only.

Your Board recommend to pass necessary resolution as set out in the notice of theAnnual General Meeting.


Pursuant to the provisions of Section 203 of the Act during the year under reviewthere were no changes in the position of KMPs.


The Board met 5 (five) times during the financial year 2017-18.The meeting details areprovided in the corporate governance report that forms part of this Annual Report. Themaximum interval between any two meetings did not exceed 120 days as prescribed in theCompanies Act 2013.


The Company has disclosed on its website( _programme_for_Independent_directors.pdf) details of the familiarization programsformulated to educate the Directors regarding their roles rights and responsibilities inthe Company and the nature of the industry in which the Company operates the businessmodel of the Company etc.


The Board is Responsible for the selection of new directors. The Board delegates thescreening and selection process to the nomination and remuneration committee whichconsists majority of independent directors. The Committee based on defined criteriamakes recommendations to the Board on the induction of the new directors. The Policy forthe Selection and Appointment of Directors is publicly available on the Company's websiteat which forms the part of this Annual Report.


One of the key functions of the Board is to monitor and review the Board evaluationframework. The Nomination and Remuneration Committee and the Board have laid down themanner in which formal annual evaluation of the performance of the Board committees andindividual directors has to be made.

All Directors responded through a structured questionnaire giving feedback about theperformance of the Board its Committees Individual directors and the Chairman. Thequestionnaire included inputs on composition culture functioning informationavailability compliance and governance effectiveness etc. Questionnaire also covered inthe case of individual directors qualitative assessment and in the case of Chairmanadditional criteria like leadership qualities and other key aspects of his role. TheIndividual Directors' responses to the questionnaire on the performance of the BoardCommittee(s) Directors and Chairman were analyzed by an independent consultant toarrive at unbiased conclusions.

The inputs including areas of improvement given by all the directors were discussedin the meeting of the Independent Directors held on 14th February 2018.

1. Criteria for evaluation of board of directors as a whole i. The frequency ofmeetings; ii. The length of meeting; iii. The administration of meeting; iv. The number ofcommittee and their note; v. The flow of information to board members and between boardmembers; vi. The quality and quantity of information; and vii. The Disclosure ofinformation to the stakeholders.

2. Criteria for evaluation of the individual Directors i. Ability to contribute andmonitor corporate governance practices; ii. Ability to contribute by introducing bestpractices to address top management issues; iii. Participation in long term strategicplanning; iv. Commitment to the fulfillment of director obligations and fiduciaryresponsibility; v. guiding strategy; vi. Monitoring management performance anddevelopment; vii. Statutory compliance and Corporate Governance; viii. Attendance andcontribution at board / Committee meetings; ix. Time spent by each of the member; and x.Core competence.


Given the nature of business and size of operations your Company has designed a properand adequate internal control system to ensure: l Recording of transactions are accuratecomplete and properly authorised; l Adherence to Accounting standards and compliance toapplicable statutes Company policies and procedures; l Effective usage of resources andsafeguarding of assets. Further your Company through its own independent andmulti-disciplinary Internal Audit function carries out periodic risk based internalaudits across locations and functions based on the Internal Audit plan as approved by theAudit Committee of the Board.

The Internal Audit function reviews compliance vis-a-vis the established design of theInternal control as also the efficiency and effectiveness of operations. The risksidentified out of the audits are reviewed periodically and mitigation ensured. The summaryof the Internal Audit findings and status of implementation of action plans for riskmitigation are submitted to the Audit Committee every quarter for review and concerns ifany are reported to the Board.

A CATALOG OF VARIOUS POLICIES OF THE COMPANY ARE HEREUNDER: l Corporate SocialResponsibility Policy l Familiarization programme for Independent directors l MaterialSubsidiary Policy l Related Party Transaction Policy l Risk Management Policy lRemuneration and Nomination Policy l Policy for determination of materiality l Policy forPreservation of the Documents


Your Company's Director make the following statement in terms of Section 134(3)(c) ofthe Companies Act 2013 which is to be the best of their knowledge and belief andaccording to the information and explanations obtained by them: a. that in the preparationof the annual financial statements for the year ended 31st March 2018 the applicableaccounting standards have been followed along with proper explanation relating to materialdepartures if any; b. that such accounting policies as mentioned in Notes to theFinancial Statements have been selected and applied consistently and judgment andestimates have been made that are reasonable and prudent so as to give a true and fairview of the state of affairs of the Company as at March 31st 2018 and of the loss of theCompany for the year ended on that date c. that proper and sufficient care has been takenfor the maintenance of adequate accounting records in accordance with the provisions ofthe Companies Act 2013 for safeguarding the assets of the Company and for preventing anddetecting fraud and other irregularities; d. that the annual financial statements havebeen prepared on a going concern basis; e. that proper internal financial controls were inplace and that the financial controls were adequate and were operating effectively.

f. that proper systems have been devised to ensure compliance with the provisions ofall applicable laws were in place and that such systems were adequate and operatingeffectively.


During the year in accordance with Companies Act 2013 the Company has the followingcommittee as at year ended 31st March 2018:

S.No Committees of the Board
1 Audit Committee
2 Corporate Social Responsibility Committee
3 Borrowing and Investment Committee
4 Nomination and Remuneration Committee
5 Stakeholders' Relationship Committee

The details with respect to the composition charters and meeting held during the yearare given in detail in the ‘Report on Corporate Governance' of the Company whichforms part of this Annual Report and is available on the Company's website at


Transaction entered with the related parties defined under the Companies Act2013 andprovisions of SEBI(LODR) regulation 2015 during the financial year 2017-18 were mainly inthe ordinary course of business and on arm's length basis.. All such contracts orarrangements have been approved by the Audit Committee. No material contracts orarrangements with related parties were entered into during the year under review. Furtherthe prescribed details of related party transactions of the Company in Form No. AOC-2 interms of Section 134 of the Act read with Rule 8 of the Companies (Accounts) Rules 2014is given in the Annexure 1 to this Report.

The policy on materiality of Related Party Transaction and dealing with related partytransaction as approved by the Board is available on the Company's website and can beaccessed at: olicy.pdf


M/s K. L. Vyas & Co. Chartered Accountants (F.R.No 003289C) the StatutoryAuditors of the Company hold office till the conclusion of the 35th Annual GeneralMeeting(AGM) of the Company. The Board has recommended for the re-appointment of M/s K. L.Vyas & Co Chartered Accountants (F.R.No 003289C) as the Statutory Auditors of theCompany for a term of five consecutive years from the conclusion of this AGM till theconclusion of the 40th AGM of the Company to be held in the year 2023for approval of theMembers by way of Special Resolution. The report of the Statutory Auditors along with theNotes to Schedules is enclosed to this report and contains an Unmodified Opinion TheAuditors' have confirmed their eligibility under Section 141(3)(g) of the Companies Act2013 and the Rules framed there under for appointment as Auditors of the Company. Asrequired under SEBI (LODR) Regulations 2015 the auditors have also confirmed that theyhold a valid certificate issued by the Peer Review Board of the Institute of CharteredAccountants of India.


Pursuant to the provisions of Section 204 of the Companies Act 2013 read with theCompanies(Appointment and Remuneration of Managerial Personnel) Rules 2014the Boardappointed M/s Ritesh Gupta & Co. Practicing Company Secretary (holding Certificateof Practice bearing No 3764) to conduct Secretarial Audit for the FY 2017-18. TheSecretarial Audit Report for the financial year ended March 31 2018 is annexed herewithmarked as “Annexure 2”in ‘Form No.MR-3'to this Report. The SecretarialAudit Report does not contain any qualification reservation adverse remark ordisclaimer.


At Sayaji Corporate Governance is all about maintaining a valuable relationship andtrust with all stakeholders. We consider stakeholders as partners in our success and weremain committed to maximising stakeholders' value be it shareholders employeessuppliers customers investors communities or policy makers. This approach to valuecreation emanates from our belief that sound governance system based on relationship andtrust is integral to creating enduring value for all. We have a defined policy frameworkfor ethical conduct of businesses. Pursuant to Regulation 24 and Regulation 34 of SEBI(LODR) Regulations 2015 the Management Discussion and Analysis Business ResponsibilityReport Report on Corporate Governance and Auditors' Certificate regarding compliance withconditions of corporate governance form part of the Directors' Report.


As required under Regulation 17(8) of the SEBI (LODR) Regulations 2015 Certificatesigned by Mr. Raoof Razak Dhanani Managing Director and Mr. Sandesh Khandelwal ChiefFinancial Officer for the year 2017-18 was placed before the Board of Directors in its1st Board Meeting held on 30th May' 2018 and is annexed to Corporate Governance Report.

A copy of the certificate on the financial statements for the financial year endedMarch 31st 2018 is annexed along with this Report.


The Consolidated Financial Statements of theCompany is prepared in accordance withIndian Accounting Standards (''Ind AS'')as notified under the Companies (Indian AccountingStandards) Rules 2015 with effect from April 1 2017 forming part of this Annual Report.


Your Company is continuously striving towards conservation of energy across all itsunits and has implemented various Energy Conservation programs and latest technology upgradation measuresyour Company also earned foreign currency in Financial Year 2017 2018The hotels are fitted with energy saving devices to conserve energy in the long run whichleads to reduce energy cost and helps to promote economic political and environmentalsustainability and thus maximize profit.

Information as required under Section 134(3)(m) of the Act read with Rule 8 (3) of theCompanies (Accounts) Rules 2014 relating to Conservation of Energy TechnologyAbsorption Foreign Exchange Earnings and Outgo are furnished in Annexure 3 to thisReport.


There are no material changes and commitment affecting the financial position of theCompany between the end of the financial year and the date of this report.


The Company's shares are available for dematerialization with both the Depositoriesviz. National Securities Depository Limited (NSDL) and Central Depository Services(India) Limited (CDSL). About 91.25% of the paid-up equity share capital of the Companyhas been dematerialized as on March 31 2018.


The Company has paid Annual Listing Fee for the Financial Year 2017-18 to the BSE Ltd.according to the prescribed norms & regulations. Company has also paid Annual CustodyFee to National Securities Depository Limited and to Central Depository Services.


As per the provisions of Section 92(3) of the Companies Act 2013 read with theCompanies (Management and Administration) Rules 2014 an extract of the Annual Return inForm MGT-9 is attached as Annexure ‘4' to this Report.


The disclosure required to be made in terms of Section 197(12) of the Companies Act2013 and Rule 5(1) is annexed herewith as “Annexure 5”.

The information as per the provision of section 197(12) of the Companies Act 2013 andRule 5(2) of Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014are as under

1 Name and Designation of The Employee Vivek Kumar Thakur (General Manager of the Sayaji Hotel Indore Unit)
2 Remuneration Received 318250/- Monthly Gross
3 Nature Of Employment Whether Contractual Or Otherwise On role employee
4 Qualifications And Experience Of The Employee Diploma in Hotel Management Experience - 18 years.
5 Date Of Commencement Of Employment; 01.06.2017
6 The Age Of Such Employee; 41 Year (13 Nov 1976 - Date Of Birth)
7 The Last Employment Held By Such Employee Before Joining The Company General Manager Chancery Pavilion Bangalore
8 The percentage of equity shares held by the employee in the Company within the meaning of clause (iii) of sub rule (2) above None
9 Whether any such employee is a relative of any director or manager of the Company and if so name of such director or manager He is not relative of any director and manager.


The Board of Directors would like to express their sincere appreciation for theassistance and co-operation received from the financial institutions banks Governmentauthorities customers vendors and members during the year under review. The Boards ofDirectors also wish to place on record its deep sense of appreciation for the committedservices by the Company's executives staff and workers.


This Report contains forward-looking statements that involve risks and uncertainties.When used in this Report the words ‘anticipate' ‘believe' ‘estimate'‘expect' ‘intend' ‘will' and other similar expressions as they relate tothe Company and / or its businesses are intended to identify such forward-lookingstatements. The Company undertakes no obligation to publicly update or revise anyforward-looking statements whether as a result of new information future events orotherwise. Actual results performances or achievements could differ materially fromthoseexpressed or implied in such forward-looking statements. Readers are cautioned not toplace undue reliance on these forward-looking statements that speak only as of theirdates. This Report should be read in conjunction with the financial statements includedherein and the notes thereto.

For and on behalf of the Board
T. N. Unni
DIN - 00079237
Place: Indore
Date : 24.08.2018