DIRECTORS' REPORT

TO MEMBERS

FOR THE YEAR ENDED 31ST MARCH 2015

Dear Members,

Your Directors are pleased to present the 20th Annual Report and the Company's audited financial statement for the financial year ended March 31, 2015.

DIVIDEND AND TRANSFER TO RESERVES

The income earned by the Company during the financial year ended 31st March 2015 comprises of financial income from mutual fund investments and interest on loans given. The Company has not earned any profit from operations since the development construction projects are under implementation. In view of the above and also in order to conserve resources for use for acquisition of land and for working capital, your Directors are not recommending any dividend for the year ended 31st March 2015 (previous year dividend paid is nil).  Your Directors have not transferred any amount to any reserves during the year.

MANAGEMENT'S DISCUSSION AND ANALYSIS

A. Industry Structure and Developments

Your Company is a building construction company. It undertakes development projects of residential and commercial multi-storied apartment complexes. The operations of the Company are presently confined to localities in and around Chennai and its suburbs.

B. Performance

Your Company reported a total income of Rs 134.38 lakhs during the year ended 31st March 2015 as against Rs 170.09 lakhs during the previous year. The profit after tax was Rs 51.46 lakhs for the year ended 31.3.2015 as against Rs 66.93 lakhs achieved during the previous year.

Your Company has not executed any development projects during the year since approval is awaited for the projects under consideration. Substantial part of total income has been earned towards interest and dividend from mutual fund units invested out of the surplus funds available with the Company pending deployment in its operations.

C. Segmentwise Performance

Your Company undertakes construction projects at Chennai and its suburb. The activities of your Company falls under single segment namely Construction of Buildings (Residential & Commercial).

Your Company project for developing and constructing multistoried residential apartments at Woods road which is abutting Mount Road at Chennai and very near to the famous Express Avenue Mall is in its initial stages where only the statutory approvals have been obtained. Your company will be commencing construction activities and marketing this project during the course of this year. Your Company is also developing another property in the suburb of Chennai for construction of commercial and / or residential space. Your Company owns landed properties at Sholinganallur, Chennai and at Arcot Dist, Tamilnadu, wherein it will be launching large scale construction projects for building residential or commercial complexes at an opportune moment.

D. Concerns

The Company and the building construction industry in Chennai in general is facing a very prolonged time duration in obtaining statutory clearances for the construction projects. The markets for residential and commercial buildings in Chennai have been stagnating in line with the general trend prevailing in other metropolitan cities as well. Several builders are holding unsold units and are resorting to providing incentives and promotions to clear their unsold units affecting their profitability. The interest rates have been reduced during the year only marginally and they still remain at way above the comfort level of discerning home buyers and business entities. The inflationary tendencies prevalent in the economy has resulted in across the board increase in the cost of the raw materials including sand, steel and cement thereby affecting the profitability and feasibility of construction projects. Land owners are not reducing the prices even though they are not able to sell at their price expectation.

E. Outlook

Your Company was not adversely affected by the general concerns being experienced by the building construction industry due to its conservative style of management. Your Company does not have unsold units; it is not saddled with burdensome finance costs since it does not have any borrowings. The delay in obtaining project approval is, in a way, affecting the operations of the company. However, consistent and continuous efforts are being made at every stage to expedite obtaining project approvals.

F. Internal Control Systems

Your company has a proper and adequate system of internal controls to ensure that all assets are safeguarded and protected against loss from un-authorised use or disposition.

G. Human resources and industrial relations

Your company has well qualified and experienced technical, financial and administrative staff to cater to its business requirements. The relations with the employees of the company remained cordial throughout the year.

CREDIT RATING

Your Company has not issued any financial instruments requiring to be rated by credit rating agencies during the year.

SUBSIDIARIES, JOINT VENTURES AND ASSOCIATE COMPANIES

Your Company does not have any subsidiary, joint venture or associate companies.

DIRECTORS' RESPONSIBILITY STATEMENT

Your Directors state that:

i. in the preparation of the annual accounts for the year ended March 31, 2015, the applicable accounting standards read with requirements set out under Schedule III to the Act, have been followed and there are no material departures from the same;

ii. the Directors have selected such accounting policies and 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, 2015 and of the profit of the Company for the year ended on that date;

iii. the Directors have 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;

iv. the Directors have prepared the annual accounts on a 'going concern' basis;

v. the Directors have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and are operating effectively; and

vi. the Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.

CORPORATE GOVERNANCE

Your Company has complied all the material requirements of Corporate Governance prescribed under Clause 49 of the Listing Agreement. A report on Corporate Governance is annexed and it forms part of this report.

CONTRACTS AND ARRANGEMENTS WITH RELATED PARTIES

During the year, the Company had not entered into any contract, arrangement or transaction with related parties which could be considered material in accordance with the policy of the Company on materiality of related party transactions.

The Policy on materiality of related party transactions and dealing with related party transactions as approved by the Board was put up on the website of the Company at www.narendraproperties.com <http://www.narendraproperties.com>.

Your Directors draw attention of the members to Note 21 : Significant Accounting Policies and Explanatory Statement - No. (3) (1) to the financial statement which sets out related party disclosures.

RISK MANAGEMENT

During the year, your Directors have constituted a Risk Management Committee which has been entrusted with the responsibility to assist the Board in framing and overseeing risk management policy and its periodical review, implementation and taking of pre-emptive corrective actions as may be deemed necessary. Your Company has adequate risk management infrastructure in place capable of addressing risks faced by the company both internal and external.

INTERNAL FINANCIAL CONTROLS

The Company has in place adequate internal financial controls with reference to financial statements. During the year, no reportable material weakness has surfaced with regard to those internal controls in place.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

During the year under review members have approved the appointment of Mr Chandrakant Udani and Mr Nishank Sakariya as Non-Executive, Non-Independent Director liable for retirement by rotation. Members have also approved the appointment of Mr S Ramalingam, Mr John K John, Mr R Subrahmanian, Mr Babubhai P Patel and Mr K S Subramanian as Independent Directors not liable for retirement by rotation. Your Directors have, based on the recommendation made by the Nomination and Remuneration Committee, appointed Mr Chandrakant Udani as the Wholetime Director and Chief Financial Officer which was approved by the members during the year. Your Directors have appointed Mrs Preethi Siddharth Maher as Additional Director who will be holding office only up to the ensuing Annual General meeting. The Company has received a special notice along with requisite deposit, from a member proposing the appointment of Mrs Preethi Siddharth Maher as a Director on the Board of the Company liable for retirement by rotation.

Your Directors Mr Mahendra K Maher and Mr Narendra Sakariya retire by rotation at the ensuing Annual General meeting and being eligible are offering themselves for re-appointment.

The Company has received declarations from all the Independent Directors of the Company confirming that they meet the criteria of independence as prescribed both under the Companies Act, 2013 and Clause 49 of the Listing Agreement with the Stock Exchange.

The Nomination & Remuneration Committee has submitted its recommendation as regards the Policy for performance evaluation of Independent Directors, Board, Committees and other individual Directors which includes criteria for performance evaluation of the non-executive directors and executive directors. The Board has accepted the recommendation and it shall be implemented for performance evaluation during the current financial year ended 31st March 2016.

A familiarisation program was conducted for the Independent Directors wherein the roles, rights, responsibilities of the Independent Directors, the business model of the company and the industry related developments was apprised and presented to them. The details of the familiarisation program conducted for Independent Directors, Policy for selection of Directors and determining Directors independence, Remuneration Policy for Directors, Key Managerial Personnel and other employees are also put up on the website of the Company at www.narendraproperties.com <http://www.narendraproperties.com>.

AUDITORS & AUDITORS' REPORT

Statutory Auditor

The report of the Statutory Auditors M/s Sanjay Bhandari & Co., Chartered Accountants, Chennai, is annexed to this report. The Auditors Report does not contain any qualification, reservation or adverse remarks.

The Statutory Auditors shall be holding office until the conclusion of the ensuing Annual General Meeting and are eligible for re-appointment. They have confirmed they are eligible for re-appointment and they are not disqualified for re-appointment as Statutory Auditors of the Company.

Secretarial Auditor

The Board has appointed Mr A M Gopikrishnan, Practising Company Secretary, to conduct Secretarial Audit for the financial year 2014-15. The Secretarial Audit Report for the financial year ended March 31, 2015 is annexed to this report.

In response to the remarks made in the Secretarial Audit Report, your Board wish to inform the members that the Company has initiated the process to appoint a Company Secretary u/s 203 of the Companies Act, 2013. Even though the Company has been taking continuous efforts to appoint a Company secretary to discharge its obligation under section 203 of the Act, the Company could not find suitable candidates willing to join the company considering its nature and extent of operations and remuneration policy.

Internal Auditor

The Board has appointed Mr R Mugunthan, Chartered Accountant, as Internal Auditor, as required under section 138 of the Companies Act, 2013. The Board and the Audit Committee are reviewing and taking on record the Internal Audit Report submitted periodically by the Internal Auditor. The Internal Auditor has not reported any adverse findings during the year.

DISCLOSURES

Corporate Social Responsibility

Your Company is not falling within the financial criteria laid down under section 135(1) of the Companies Act, 2013, and as such is not under obligation constitute Corporate Social Responsibility committee and undertake CSR activities.

Audit committee

The Audit Committee comprises of four Independent Directors and one Non-Independent Director and as such the composition requirements prescribed under section 177 of the Companies Act, 2013 and the Listing Agreement is satisfied. All the recommendations made by the Audit Committee during the year have been accepted by the Board.

Vigil Mechanism

The Company has put in place a vigil mechanism in order to facilitate Directors and Employees to report on genuine concerns. The Whistle Blower policy adopted by the Company and the Vigil Mechanism as a part of the said policy has been put up on the website of the Company at www.narendraproperties.com <http://www.narendraproperties.com>.

Meetings of Board

During the year five meetings of the Board of Directors were held. The dates on which the Board meetings were held and the attendance of the Directors therein is furnished in the Corporate Governance Report.

Particulars of Loans given, Investments made, Guarantees given and securities provided.

The particulars of Loans given, investments made and the purpose for which the loan given is proposed to be utilised by the recipient is furnished in Note 21 : Significant Accounting Policies and Explanatory Statement - No. (3) (2) to the financial statements.

The Company has not given any guarantees and has not provided any security during the year.

Conservation of energy, technology absorption, foreign exchange earnings and outgo.

As the Company is basically a construction company, the Provisions of Sec. 134 (3) (m) of the Companies Act, 2013, so far as the information relating to conservation of energy and technology absorption is not applicable to the Company. The Company has not earned any revenue in foreign exchange and it has also not incurred any expenditure in foreign currency during the year.

Extract of Annual Return

The extract of Annual Return as on 31st March 2015 in the prescribed Form MGT9 is annexed to this report. Particulars of Employees and related disclosures

In terms of the requirements of Section 197(12) of the Companies Act, 2013, read with Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, your Directors wish to state that none of the employees are drawing remuneration in excess of the limits set out in the said rules.

Disclosures pertaining to remuneration and other details as required under Section 197(12) of the Act read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are as follows:

Employees Stock Option Scheme

The Company has not formulated any Employees Stock Option scheme.  Disclosure under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

The Company has in place Anti Sexual Harassment Policy in line with the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. All employees (permanent, contractual, temporary, trainees) are covered under this policy. The Company has not received any complaints under the said Act during the year.

General

Your Directors do not have anything to report or disclose on the following items since there were no transaction relating to them during the year:

i. No deposits were accepted attracting the provisions of section 73 - 76 of the Companies Act, 2013.

ii. The Company has not issued any equity shares during the year with differential rights as to dividend, voting or otherwise.

iii. The Company has not issued any shares (including sweat equity shares) to any of its employees during the year.

iv. The Company does not have any subsidiary, Joint venture or associate companies and as such the Managing Director / Whole time Directors receiving any remuneration from such companies does not arise.

v. No significant or material orders were passed by the Regulators or Courts or Tribunals which impact the going concern status and Company's operations in future.

vi. There were no material changes and commitments affecting the financial position of the company which have occurred between 31st March 2015 and the date of this report.

vii. The Board has reviewed the system in place to monitor compliance with all the applicable laws relating to Companies domain of operation and it has not come across any material non-compliance with such laws during the year.

ACKNOWLEDGEMENT

Your Directors take this opportunity to thank the various Governmental authorities, the Company's Bankers Bank of Baroda, HDFC Bank Limited, Anna Salai Branch, HDFC Bank Limited, Kilpauk Branch, Tamilnad Mercantile Bank Limited and all the customers, suppliers and contractors who have supported the efforts of the Company at every critical stage.  Your Directors also wish to place on record the dedicated services rendered by the employees of the Company  at all levels.

By Order of the Board,

For and on behalf of the Board of Directors

S RAMALINGAM

CHAIRMAN

PLACE : CHENNAI

DATED: 10TH AUGUST 2015