A Report On

Institutional training undertaken at

SAVERA INDUSTRIES LIMITED

Submitted in partial fulfillment of the requirement for

the award of the degree

BACHELOR OF COMMERCE
(CORPORATE SECRETARYSHIP)

By

HONEY MODI
2113721042030

Under the guidance of

Ms. K J RACHEL, M.Com, MBA

DEPARTMENT OF COMMERCE (CORPORATE SECRETARYSHIP)

M.O.P. VAISHNAV COLLEGE FOR WOMEN (Autonomous)

CHENNAI-600034

2023-2024

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 ACKNOWLEDGEMENT

I express my heartfelt gratitude to the Principal Dr. ARCHNA PRASAD

M.Com., MBA., Ph.D. for giving me the opportunity to gain practical
knowledge through undergoing institutional training.

I am grateful to the Head of Department Dr. V. SUDHA, M.Com., B.Ed.,

M.Phil., Ph.D. and my Faculty Advisor Ms. K J RACHEL, M.Com, MBA for
their guidance and valuable help in framing this project report.

I am very grateful to all the staff members of Savera Industries Limited for
offering their timely help whenever required.

I once again like to thank everybody who helped me in submitting my project

report successfully.

HONEY MODI

2
 DECLARATION

The project report on the institutional training undergone at SAVERA

INDUSTRIES LIMITED in partial fulfillment of the requirement for the award
of the degree of Bachelor of Commerce submitted by me, Honey Modi –
2113721042030 is a record of the original work done by me.

Ms. K J Rachel, M. Com, MBA

Faculty Advisor

Dr. V. Sudha, M.Com., B.Ed., M.Phil., Ph.D.

Head of Department

Submitted to M.O.P. Vaishnav College for Women

On:

3
COMPLETION CERIFICATE-

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 TABLE OF CONTENTS

CHAPTER TITLE PAGE NO.

NO.

1 INTRODUCTION 8

2 MEMORANDUM OF ASSOCIATION AND 15

ARTICLES OF ASSOCIATION

3 DEPARTMENTATION 62

4 DATA ANALYSIS AND INTERPRETATION 66

5 FINDINGS, SUGGESTIONS AND CONCLUSIONS 79

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 LIST OF CHARTS

S.NO. CHART NO. DESCRIPTION PAGE NO.

1. 4.1 SHARE CAPITAL OF THE COMPANY 68

2. 4.2 INCOME FROM OPERATIONS OF THE 69

COMPANY

3. 4.3 NET PROFIT BEFORE INTERSET AND 70

TAXATION

4. 4.4 NET PROFIT AFTER INTEREST AND 71

TAXATION

5. 4.5 CURRENT RATIO 74

6. 4.6 PROPRIETARY RATIO 75

7. 4.7 RETURN ON CAPITAL EMPLOYED 76

8. 4.8 DEBT TO EQUITY RATIO 77

9. 4.9 CASH RATIO 78

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 LIST OF TABLES

S.NO. TABLE NO. DESCRIPTION PAGE NO.

1. 4.1 SHARE CAPITAL OF THE COMPANY 68

2. 4.2 INCOME FROM OPERATIONS OF THE 69

COMPANY

3. 4.3 NET PROFIT BEFORE INTERSET AND 70

TAXATION

4. 4.4 NET PROFIT AFTER INTEREST AND 71

TAXATION

5. 4.5 CURRENT RATIO 74

6. 4.6 PROPRIETARY RATIO 75

7. 4.7 RETURN TO CAPITAL EMPLOYED 76

8. 4.8 DEBT TO EQUITY RATIO 77

9. 4.9 CASH RATIO 78

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 CHAPTER 1
INTRODUCTION

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HOTEL INDUSTRY - AN OVERVIEW

Hospitality means extending a welcome to travellers or offering a home away from home,
and the word is derived from the Latin word “hospes” meaning visitor or stranger. The
hospitality and tourism industry is a vast sector that includes all the economic activities that
directly or indirectly contribute to, or depend upon, travel and tourism. This industry sector
includes:

 Hotels & Resorts

 Restaurants & Catering
 Night Clubs & Bars
 Travel & Transportation
 Tourism
 Spas & Wellness
 Cruise Liners & Bus tours
 Events (Private, Business, Cultural & Sports)

THE HISTORY OF HOSPITALITY

 Hospitality is one of the oldest businesses, going way back to the innkeepers and
taverns of biblical times.

 In the late 1800’s, the concept of leisure hospitality spread across Europe, bringing
flocks of wealthy travellers to Switzerland. It began with visitors seeking cultural and
natural exposure on guided tours in the Swiss Alps, train rides and wellness tourism.
Palace-style hotels, thermal baths and ski resorts became icons of luxury tourism in
Switzerland.

 This new generation of wealthy guests had higher expectations for comfortable
accommodations, convenient services and fine dining. The leisure travel phenomenon
gave birth to hospitality management schools: EHL was founded as the first hotel
management school in 1893 in Lausanne, and it has pioneered in hospitality education
since then

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HOSPITALITY INDUSTRY IN INDIA

The hospitality industry in India was seeing tremendous growth in the last few years, which was
slightly marred by the Covid-19 impact in 2020. Considered a sunrise industry, it shows a huge
potential for manifold growth in the future. The hospitality sector is one of the most profitable,
accounting for more than 8% of the country’s workforce and an estimated 15 million jobs being
created in the last few years. It is one of the top sectors attracting FDI or Foreign Direct
Investment in the country.

RECENT GROWTH IN HOSPITALITY SECTOR

Within the hospitality industry, the hotel performance across most major cities in India saw
significant growth in 2021 after the end of the Covid-19 second wave and before the third wave
set in. Apart from leisure travel, the sector saw revenues coming in from corporate travel as
businesses restarted after lock-downs. Due to this recovery in recent months, there has since
been improved confidence in the sector.

People are increasingly going on staycations, long weekend getaways, and also social gatherings
such as weddings. This has resulted in business growth for the hospitality sector. Additionally,
better road infrastructure across the country, especially holiday destinations like hill regions, has
provided a much-needed boost to road travel.

POSSIBLE HINDRANCES IN HOSPITALITY INDUSTRY

The implementation of the goods and services tax (GST) was seen as a growth-deterrent by the
hospitality industry as customers felt the pinch of high expenses being levied. Rising
competition has been another challenge faced by most businesses involved in the hospitality
sector.

As the Indian consumer mindset is experiencing a drastic shift due to rising exposure to foreign
tourism combined with Covid-19 related hygiene expectations, hospitality businesses are facing
many challenges to meet many of these expectations.

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COMPANY PROFILE:
SAVERA INDUSTRIES LIMITED

Started in 1968 with 25 rooms and other facilities, The Savera Hotel stands today as an iconic
landmark in Chennai with 230 rooms, 8 food & beverage outlets, 10 conference & meeting
venues and a host of leisure facilities.

It is a unit of Savera Industries Ltd, which is more than four-decade strong multidisciplinary
group of companies, based in Chennai. Apart from having a strong hold in the Hospitality
sector, the management has diversified interests in mining, education, health and wellness as
well.

Savera Hotel has the privilege of being managed by the most experienced hoteliers and
restaurateurs – Smt. A. Nina Reddy and Shri. A. Ravikumar Reddy. The first family in
Chennai hospitality business also has diversified interest in restaurants, mining and
education.

Savera Hotel management is committed to promote tourism and actively participates in the
Government of India initiatives like HUNAR SE ROZGAR for skill development in hotel
services. Extending the reach through CSR activities, the management provides a platform
for marginalised sections of society and the less privileged. Savera Hotel is closely associated
with National Association for Blind and organizes several programs throughout the year like
Blind Car Rally and fund raising campaigns.

Savera Hotel management firmly believes in ATITHI DEVO BHAVAH and always searches
for excellence in everything they do.

Their motto is” Stay with us and enjoy a long tradition of impeccable service!”

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HOTEL AND ITS INFRASTRUCTURE

The hotel features eight food and beverage venues, including, the multi-cuisine restaurant
named The Piano, a South Indian restaurant named Malgudi, a roof-top North Indian
restaurant named Curry Town, a restaurant lounge named Bay 146, a bar longue named
Bamboo Bar, a garden coffee house named Brew Room, and a cake shop named Baker's
Basket. The hotel has 10 meeting venues.
The hotel has a corporate social responsibility entity named Savera Hotel Academy
established to guide students towards a career in hospitality industry.

DIVISIONS OF SAVERA INDUSTRIES

 Body Lyrics
 O2 Spa-Besant Nagar & Thoraipakkam
 Malgudi
 Bay 146
 Bamboo Bar
 Curry Town
 The Brew Room-Mylapore & Anna Nagar
 Ciros
 Piano/In Room Dining

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VALUES OF SAVERA INDUSTRIES LIMITED-

1. PATIENCE:
Hospitality can get rather demanding. Each guest and temperament will be different.
Many times, customers mean well and only want to make sure they make the most out
of the experience they paid for, and they can get understandably upset when this is not
met.

2. EMPATHY:
Empathy is an underrated yet essential quality. Being able to relate to another person
genuinely can help you come up with sincere and people-centred solutions, especially
when faced with customer grievances.

3. COMMUNICATION SKILLS:
Having strong communication skills, whether verbal or written, is a must. After all, a
“people business” is critical when working in service-driven businesses. Dealing with
customers requires thoughtful tact and sensitivity. As such, using the appropriate tone
and manner of communication befitting the situation is key towards creating positive
customer experiences.

4. PROBLEM-SOLVING SKILLS:
People tend to be highly complex creatures. So, getting creative when solving
problems involving emotions is important. By exploring alternative ways to defuse
tense situations, you will discover unconventional approaches that might surprise and
even delight customers. You must then be driven by the need to solve problems as
quickly and efficiently as possible.

5. OPENNESS TO FEEDBACK:
As part of the hospitality industry, you will receive all kinds of comments, reactions,
and feedback. It is important not to get defensive when you get feedback — at the
same time, learn to discern which feedback would be most helpful in improving your
performance. With this in mind, you should welcome and appreciate customer
feedback and take it with an objective perspective. If it is a negative comment, try not
to take it too personally. Learn the difference between constructive criticism and petty
complaints. Stay open, but focus on learning from the experience and moving
forward.

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SHORT PROFILE

COMPANY NAME : Savera Industries Limited

ADDRESS : 146, Dr. Radha Krishnan Salai, Mylapore,

Chennai-600004 (near Music Academy)

TYPE OF COMPANY : Public Limited Company

DATE OF INCORPORATION : 17 November 1969

AGE OF COMPANY : 54 years

NATURE OF BUSSINESS : Hospitality

NUMBER OF EMPLOYEES : 420-430 employees

DIRECTORS : A Ravikumar Reddy

Nina Reddy

S Sridhara Rao

A Sudhakar Reddy

A Tarun Reddy

A Nivruti Reddy

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 CHAPTER 2
MEMORANDUM AND
ARTICLES OF
ASSOCIATION

15
 COMPANIES ACT, 1956
COMPANIES LIMITED BY SHARES

MEMORANDUM OF ASSOCIATION
OF
SAVERA HOTELS LIMITED

I. The name of the company is SAVERA HOTELS LIMITED.

II. The Registered Office of the company will be situated in the state of Tamil Nadu.

III. (A) THE MAIN OBECTS TO BE PURSUED BY THE COMPANY ON ITS

INCORPORATION ARE:

1) To carry on the Business of hoteliers, restaurant, café, tavern, beer house, refreshment rooms
on lodge-house keepers, motels, auto courts, holiday camps and apartment house keepers,
licensed victuallers, manufacturers of aerated, mineral artificial waters and other drinks,
purveyors and caterers for public amusement and to the extent permitted by law, wine, and
beer spirit merchants, brewers, masters and distillers.

2) The carry on the business of proprietors of restaurants, refreshment and tea rooms,
cafes and milk and snack bars, and as caterers and contractors in all its respective
branches, bakers, confectioners, tobacconists, butchers, fishmongers, milk sellers,
dairymen, grocers, polluters, greengrocers, farmers, ice merchants and ice-cream
makers.

3) To buy, sell, refine, prepare, grow, import and deal in provisions of all kinds, both
wholesale and retail and whether solid or liquid.

4) To build, make, construct, purchase, equip, maintain and improve, alter, lease and
work concert halls, ball room and music halls, cinema theatres, lodging restaurant
houses, chattels, cottages, et., and provide them with television, radio, gramophone
and other amusements.

5) To invest in and/or promotor and/or establish in its own name or as holding company
or as a subsidiary company or otherwise as per applicable law to carry on business of
educational institutions having hotel, tourism, catering and allied related courses.

6) To carry on the business of farming, agriculture, horticulture, floriculture, sericulture,

dairies, cultivators of all kinds of flowers including coronation, decoration, ornaments
and otherwise, food grains, seeds, fruits and proprietors of orchard and traders,
exporters and sellers of and dealers in products of farming, agriculture, horticulture,
floriculture, sericulture, dairies and pisciculture and manufacturing of any product

16
 from above and any kind or nature whatsoever process and preparations of every kind
and description.

7) To extract by-products and derivatives, whether edibles, pharmaceuticals, medical or

of any kind or nature whatsoever and including all related preparations of every kind
and description from farming, agriculture, horticulture, floriculture, sericulture, and
dairies.

8) To carry on the business of manufacture of and trading in preserved, dehydrated,

canned or converted agricultural products, horticulture products, floriculture products,
sericulture products and dairy products and articles and other derivatives of all kinds
and description.

9) To import, develop, grow, cultivate, multiply, build nurseries, hardening facilities,

green-houses, other infrastructure to store, pack, transport, distribute, sell, export
tissue culture plantlets in both in vitro condition and in hardened condition and
products of all kinds and varieties of farming, horticulture, floriculture, sericulture,
dairies including forestry products, plantation and non-plantations crops.

10) To cultivate lands for agricultural produce, horticulture produce, to carry on and work
the business of cultivators, winners and buyers of every kind of vegetables, mineral or
other produce of the soil, to prepare manufacture and render marketable any agro
produce such as rice, wheat, pulses, chillies, garlic, soap nut, turmeric, edible and
non-edible oil seeds, oil, oil cakes, spices like cloves, cardamom, coriander, pickles,
powders of any or a combination of any of the above items such as curry powder,
chillies powder, turmeric powder and masala ingredients, either in its prepared,
manufactured or raw state and either by wholesale or retail business and in India or
abroad.

11) To carry on business of manufacturers of and dealers in containers, boxes, packings,

Packages, wrappings, wrappers, receptacles, bottles, corks including tin plate crown
corks, crates and containers of all kinds made of paper, board, plastic, metal, glass,
veneers and other materials synthetic or natural.

12) To develop the land for Resorts, Farm Houses or cottages by providing roads, and
water and sell the same and to erect and construct resorts, farm houses, cottages or
works of every description on any land of the company or upon any other such lands
or immovable property and to pull down, rebuild, enlarge, alter and improve such
land into roads, streets, squares, gardens and such other conveniences related thereto
deal with and improve the immovable property of the company or any other such
immovable property of all types.

13) To purchase, sell, develop, take in exchange, or on lease, hire or otherwise, acquire,
whether for investment or sale, or working the same, any real or personal estate

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 including lands, mines, business, buildings, cottages, fats, apartments, shops, depots,
warehouses, mineral rights, concessions, privileges, licences, easement, residential
and/or commercial or interest in or with respect to any property whatsoever for the
purpose of the company in consideration for a gross sum or rent or partly in one way
and partly in the other or for any other consideration and to carry on business as
properties of fats and buildings and to let on lease or otherwise apartments therein and
to provide for the conveniences commonly provided in flats, suites and residential and
business quarters.

(B) THE OBJECTS INCIDENTAL OR ANCILLARY TO ATTAINMENT OF

THE MAIN OBJECTS ARE:

1) To carry on business as proprietors and manager of pleasure grounds and places of

amusement, recreation, sport, entertainment and instruction of all kinds, proprietors of
motor and other vehicles, garage proprietors, dealers in curios, travel agents, agents
for carriers, railway, shipping and airplane companies and theatrical and opera box
which can be proprietors, entrepreneurs and general agents conveniently carried on
with the main business of the company.

2) To establish and provide all kinds conveniences and attractions for customers and
others and in particular reading. writing and smoke rooms, lockers And safe deposits,
telephones, telex and telegraphs, club, stores and shops.

3) To buy, sell import, produce, manufacture or otherwise deal in food and food
products, meat, groceries, fruits, biscuits, confectionery, linen, furniture and
furnishings and other articles required in connection with the main business and to the
extent permitted by law in wine, spirit, beer and alcoholic beverages.

4) To carry on all or any of the business of dairymen, cheese, butter, egg, pork-pie and
sausages manufacturers and merchants, poultry and livestock breeders, bakers,
confectioners, refreshment contractors, farmers, grocers and general provisions
merchants and dealers for the purpose of the main business of the company.

5) To carry on the business of launderers, cleaners, dry cleaners and carpet beaters and
to carry on the business of repairing all articles sent for cleaning or beating in
connecting with the main object.

6) To manufacture, buy, sell, improve, treat, preserve, fine, aerate, mineralise, bottle and
otherwise deal in mineral and waters and other liquids of every description.

7) To present, produce, manage, conduct and represent and theatre, music hall, or place
of amusement or entertainment, such plays, dramas, commodities, operas, burlesques,
pantomimes, revues, promenade and other concerts, musical and other pieces, ballets,

18
 shows, exhibition's variety and other entertainment as the company from time to time
think fit.

8) To purchase, undertake, or otherwise acquire all or any part of the business, property,
goodwill and assets of any person, firm or company, or society and as part of the
consideration for such purchase to undertake all or any of the liabilities of the
aforesaid person, firm or company or society, and to pay for any such purchase, or
acquisition either in cash, shares, or securities, which the company has power to issue,
or partly in one more and partly in another or in such other way as the company may
determine, to conduct and carry on, wind up any such business, to amalgamate with
any other company to enter into partnership or any arrangement for joint adventure,
reciprocal concession, or otherwise or for limiting completion, or for mutual
assistance with any or any of the acts and things aforesaid or property or business
acquired, any shares, debentures or securities that may be agreed upon, and to hold
sell, reissue, with or without guarantee, mortgage, or otherwise deal with any shares.
debentures or securities so received.

9) To purchase, take on lease, hire, exchange or acquire by way of rent, concession or

license, or otherwise, any movable or immovable property including lands, factories,
works, building, water rights, casements and other privileges and rights relating to
immovable property, machinery, plant, stock in-trade, trademarks, patents and any
rights and privileges which the company may think for or convenient for the purposes
of its objects.

10) To sell, lease, mortgage, charge, transfer, assign, exchange, hire dispose of turn into
account, manage, improve and otherwise deal with all or any part of the property,
movable or immovable, and rights of the company.

11) To erect, construct, enlarge, lay down, alter, maintain, improve develop or otherwise
deal with any buildings, sheds, stores, godowns, shops, cooly lines office and staff
quarters, bungalows, reservoirs, watercourses, factories, transports, bridges, etc., that
are necessary or convenient for the company's business or may seem calculated
directly or indirectly to advance or otherwise take part in the construction,
improvement, maintenance, management, carrying out or control thereof.

12) To guarantee the payment of money secured by or payable under or in respect of

bonds, debentures, debenture stocks, contracts, mortgages, charges, obligations, and
securities of any company or of any authority or of any persons whomsoever.

13) To open banking accounts and draw, make, accept, endorse, negotiate discount and
execute cheques, promissory notes, bills of exchange, charter parties, bills of lading,
hundis, warrants, debentures, and other negotiable or transferable instruments.

19
14) To borrow money on such terms as may seem expedient for financing the business of
the company and secure the repayment of moneys borrowed in such manner as the
Company shall think fit, and in particular by the creation of any mortgage or charge
upon all or any of the property or assets of the Company, whether movable or
immovable, or by the issue of debentures, or mortgage debentures, debentures stock,
perpetual or otherwise, charged upon all or any of the Company's property including
its uncalled capital and upon such terms as to priority or otherwise as the Company
shall think fit, and to purchase, redeem or pay off such debentures, mortgages or
securities.

15) To promote or finance, or assist in the promoting or financing of any business

undertaking, manufacture, or industry, either through the instrumentally of syndicates
of otherwise, for all or any of the objects mentioned in this Memorandum or any
extension thereof, and to transfer to any such Company, business or undertaking all or
any of the properties of the Company, and to take or otherwise acquire and hold
shares, debentures, and other securities of any such company, and to subsidies or
otherwise assist the same generally and to undertake, perform and carry out any
transaction or operation commonly carried on.

16) To invest and deal with moneys of the Company in such manner as may from time to
time be determined by the Company, and to advance and lend moneys upon such
security as may be thought fit, or without security with power in particular to take or
otherwise acquire and hold shares, debentures, debenture stock, bonds or other
securities of any person, firm or company or of any Government, State, Municipal,
Local or other Authority.

17) To acquire by subscription, purchase or otherwise and to accept and take hold and sell
shares or stock in any company, society or undertaking.

18) To purchase or otherwise acquire all or any part of the business, property and
liabilities of any company, society, partnership or person formed for all or any one of
the or purposes within the objects of this Company, and to conduct and carry liquidate
and wind up any such business.

19) To enter into partnership or enter into any arrangement for sharing profits, union of
interests, cooperation, joint adventure or reciprocal concession with any person or
company carrying on or engaged in or about to carry on or engage in any business or
transaction capable of being conducted so as directly or indirectly to benefit the
Company.

20) To apply for and take out, purchase or otherwise acquire any designs, trademarks,
patents, patent rights or invention, copyright or secret processes which may be useful
for the company's objects and to grant license to use the same.

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21) To provide for the welfare of persons in the employment of the Company or formerly
in the employment of the Company or its predecessors in business and the wives,
widows and families of such persons, by grants of money, pensions, gratuity or other
payments and by providing or subscribing towards places of instruction and recreation
and hospitals, dispensaries, medical and other attendance, and other assistance as the
company shall think fit, and to form, subscribe to or otherwise assist any charitable,
benevolent, religious, scientific, national or other institutions or objects.

22) From time to time to subscribe or contribute to any charitable, benevolent or useful
object of a public character, the support or contribution to which will, in the opinion
of the Company, tend to increase its repute or popularity among its employees, its
customers and/or the public.

23) To establish, promote or otherwise asset and company or companies for the purpose
of acquiring any of the property of furthering any of the object of this Company.

24) To pay all costs, charges, and expenses incurred or sustained in or about the
promotion and establishment of the Company, or which the company shall consider to
be in the nature of preliminary expenses including therein the cost of advertising,
commission for underwriting brokerage, printing and stationery, legal and other
expenses attendant upon the formation of the Company and of agencies and local
boards.

25) Upon any issue of shares, debentures or other securities of the Company, to employee
brokers, commission agents and underwriters, and to provide for the remuneration of
such persons for their services by payment in cash, or by the issue of shares,
debentures or other securities of the company or by the granting of options to take the
same or in any other manner allowed by law.

26) To constitute, maintain, control, administer and dispose of reserve and other funds
and generally to pay dividends, bonuses, commissions, pensions, gratuities, honoraria,
and to distribute any assets of the Company in specie among members of staff or
others as allowed by us.

27) To accept stock or shares, in or the debentures, mortgage debentures or other

securities of any other company in payment or in part payment for an services
rendered or for any sale made to or debt owing from any such company.

28) To sell or dispose of the Understanding of the Company or any part thereof for such
consideration as the Company may think fit and in particular for the shares or
debentures of any other company.

29) To procure the Company to be registered in any foreign country or place.

21
 30) To establish branches, deposits, factories, etc., whatever it may be considered
necessary, whether in the union of India or outside and to carry on the business of the
company at such place or places.

31) To appoint, employ, engage, maintain, remunerate, hire or dismiss manager,

superintendents, Assistant, secretaries or other officers, clerks, coolies and other
servants and labourers, attorneys, lawyers, technical and scientific experts as may be
necessary and expedient for the successful carrying out of the business of the
company and to determine and specify their powers, duties, salaries and to revoke,
suspend or dismiss any appointment at will.

32) To adopt such means of making known the business of the Company as may seem
expedient and in particular by advertising in the press, by circulars, by purchase and
exhibition of works of art or interest, by publication of books, periodicals and
pamphlets and granting prizes, rewards and donations.

33) To distribute in specie or otherwise as may be resolved any assets of the Company
among its members, and particular the shares, debentures, or other securities of any
other company formed to take over the whole or any part of the assets or liabilities of
this company and

34) To insure all or any stock trade, plant and machinery, office and other property and
assets of the Company against loss or damages however caused.

(C) THE OTHER OBJECTS NOT INCLUDED (A) AND (B) SUPRA ARE:

1) To carry on the business of importers and exporters and dealers of all kinds of
merchandise, raw materials, manufactured goods, material and produce of every
description and to carry on business as commission agents, forwarding agents and
general merchants.

2) To purchase or otherwise acquire lands, houses, offices, workshops, buildings, and

premises and any fixed and movable machinery, tools, engines, boilers, plants,
implements, patterns, stock-in-trade, patents and patent rights convenient to be used
in our about the trade or business of the company.

IV. The liability of the members is limited.

V. The share capital of the company is Rs.7,00,00,000 divided into 70,00,000 equity
shares of Rs.10/- each with power however to the company to increase or reduce the
capital of the Company and to divide the shares in the capital for the time being into
several classes and to attach thereto respectively and preferential, qualified or special

22
 rights, privileges or conditions and to vary, modify or abrogate any such rights,
privileges or conditions.

We, the several persons whose names and address are subscribed, are desirous of being
formed into company in pursuance of this Memorandum of Association and we respectively
agree to take the number of shares in the capital of the company set out opposite to respective
names.

Sl. Name, Address, Description and Number of shares taken Signature

no Occupation of the Subscribers by each Subscriber
1 A. Venkatkrishna Reddy 50 Sd/-
S/o Late. A Jayarami Reddy (Fifty shares)
36, Prithvi Avenue
Madras- 600018
2 A. Shymasundara Reddy 50 Sd/-
S/o Late. A Jayarami Reddy (Fifty shares)
Bazaar Street,
Gudur, Nellore Dist. (A.P)
3 M. Ramaraghava Reddy 50 Sd/-
S/o Late. M. Darasaradharmi (Fifty shares)
Reddy
Janakirampet,
Gudur, Nellore Dist. (A.P)
150 Shares
Total (Total One Hundred and
Fifty Shares)

Total shares taken 150 (One Hundred and Fifty Only) shares of Rs.100 each.

Date the 1 November 1969.

Witness to the above signature

Sd/
C.V.Narasimhan
S/o. Late Sri. N.C.Venkatachari
Accountant
Savera Hotel
Mylapore, Madras - 600 004.

23
 ARTICLES OF ASSOCIATION
OF
SAVERA HOTELS LIMITED

1. In so far as these Articles do not exclude or modify regulations contained in Table A

in the 1st Schedule of the Companies Act, those regulations so far as applicable shall
apply to this Company.

INTERPRETATION

2. In the interpretation of these Articles of the following words and expressions,

wherever used, shall have the meanings assigned to them herein below unless
repugnant to the subject or the context thereof.

"THE ACT" means the Companies Act, 1956, or statutory modification or re-
enactment thereof.

"BOARD" OR THE "BOARD OF DIRECTORS" means as the case may be the

Directors of the Company referred to collectively or a meeting of the Directors duly
called and constituted or the Directors assembled at the Board or the requisite number
of Directors entitled to pass a Circular Resolution in accordance with these Articles.

"THE COMPANY" or "THIS COMPANY" means 'Savera Hotels Limited'

"DIRECTOR" means any person elected or appointed as a Director of the Company.

"MEMBER" means a duly registered shareholder from time to time of the Company
but does not include the bearer of a Share Warrant.

"PERSONS" includes individual Society, association of persons, company, body

corporate and corporation.

"WRITING" means words written or printed or partly printed or partly written or

lithographed or cyclostyled or typewritten or by other mode or modes of representing
or reproducing words in a visible form. number

Words importing the singular shall include, unless repugnant to the context; the plural
and vice versa.

Words importing the masculine gender shall include the feminine gender.

24
 Subject defined as aforesaid, any words or expressions contained in these Regulations
and the same in meaning the Act, Shall, except where the subject or context otherwise
required, bear as in the Act.

The Index headings marginal notes and numbers hereto are inserted for only and shall
not convenience affect the construction of these presents.

SHARE CAPITAL AND VARIATION OF RIGHTS

3. The Authorised Share Capital of the Company is only) divided Rs.7,00,00,000/-

(Rupees Seven crore into 70,00,000 equity shares of Rs.10/- (Rupees ten only) each.

4. a. Subject to the provisions of these Articles and of Companies Act, 1956, the shares
shall be under the control of the Board, who may allot, or otherwise dispose of the
same to such persons or such terms and conditions and at such times as the Board
shall think fit and (Subject to the provisions of section 78 and 79 of the Companies
Act, 1956) either at a premium or at par or at a discount provided that the Company
will not give to any person the option to call off any shares without sanction of these
shareholders of the Company in general meeting.

b. Subject to the provisions of Section 80, any preference shares may with the
sanction of an ordinary resolution, be issued on the terms that are or at the option of
the company are liable, to be redeemed on such terms and in such manner as the
company before the issue of the shares, may, by special resolution determine.

5. a. If at any time the share capital is divided into different classes of shares, the rights
attached to any clause (Unless otherwise provided by the terms of issue of the shares
of that class) may, subject to the provisions of sections 106 and 107, and whether or
not the Company is being wound up, be varied with the consent in writing of the
holders of the issued shares of that class, or with the sanction of a special resolution
passed at a separate meeting of the holders of the shares of that class.

b. To every such separate meeting, the provisions of these regulations relating to

general meetings shall mutatis mutandis apply, but so that the necessary quorum shall
be two persons at least holding or representing by proxy one third of the issued shares
of the class in question but so that if at any adjourned meeting of such holders a
quorum as above defined is not present, the members present shall be quorum.

6. The rights conferred upon the holders of the shares of any class issued with preferred
or other rights shall not, unless otherwise expressly provided by the terms of issue of
the shares of that class, be deemed to be varied by the creation or issue of further
shares ranking pari passu therewith.

25
7. The Company may from time to time by ordinary resolution increase the share capital
by such sum to be divided into shares of such amount as may be specified in the
resolution.

The Company may by ordinary resolution:

a) Increase its share capital by such amount as it thinks expedient by issuing new
shares.

b) Consolidate and divide all or any of its share capital into share of larger amount
than it existing shares.

c) Convert all or any of its Fully Paid Up Shares into stock and re-covert that stock
into fully paid up shares of any denomination.

d) Sub-divide its shares, or any of them into shares of smaller amount than is fixed
by the Memorandum, so however, that in the sub-division the proportion between
the amount paid and the amount, if any unpaid on each reduced share shall be the
same it was in the case of the share from which the reduced share is derived.

e) Cancel shares which, at the date of the passing of the Resolution in that behalf,
have not been taken or agreed to be taken by any person and diminish the amount
of its share capital by the amount of the shares so concealed.

f) The Company may, by a Special Resolution reduce in. any manner and with
subject to any incident authorised and consent required by law.

a. its share capital

b. any capital redemption reserve account
c. any share premium account

8. a. FURTHER ISSUE OF SHARES

1. Where at the time after the expiry of two years from the formation of the company or
at any time after the expiry of one year from the allotment of shares in the Company
made for the first time after its formation, whichever is earlier, it is proposed to
increase the subscribed capital of the Company by allotment of further shares whether
out of the unissued capital or out of the increased share capital then:

a. Such further share shall be offered to the persons who at the date of the offer,
are holders of the equity shares of the company, in proportion, as near as
circumstances admit, to the capital paid up on those shares at the date.

26
 b. Such offer shall be made by a notice specifying the number of shares offered
and limiting a time not less than thirty days from the date of the offer and the
offer if not accepted, will be deemed to have been declined.

c. The offer aforesaid shall be deemed to include a right exercisable by the

person concerned to renounce the shares offered to them in favour of any other
person and the notice referred to in sub clause (b) hereof shall contain a
statement of this right, PROVIDED that the Directors may decline, without
assigning member may any reason to allot any shares to any person in whose
favour any renounce the shares offered to him.

d. After expiry of the time specified in the aforesaid notice or on receipt of

earlier intimation from the person to whom such notice is given that he
declines to accept the shares offered, the Board of Directors may dispose off
them in such manner and to such person(s) they may think, in their sole
discretion, fit.

2. Not withstanding anything contained in subclause ) thereof, the further shares

aforesaid may be offered to any persons (whether or not those persons include the
persons referred to in clause (a) of sub-clause (1) thereof in any manner whatsoever.

a. If a special resolution to that effect is passed by the company in General

Meeting, or

b. Where no such special resolution is passed, if the votes cast (whether on a

show of hands or on a poll as the case may be) in favour of the proposal
contained in the resolution moved in the general meeting (including the
casting vote, if any, of the Chairman) by the members who, being entitled to
do so, vote in person, o where proxies are allowed, by proxy, exceed the votes,
if any, cast against the proposal by members, so entitled and voting and the
Central Government is satisfied, on an application made by the Board of
Directors in this behalf, that the proposal is more beneficial to the Company.

3. Nothing in sub-clause (c) of (1) hereof shall be deemed;

a. To extend the time within which the offer should be accepted; or

b. To authorise any person to exercise the right of renunciation for a second time
on the ground that the person in whose favour the renunciation was first made
has declined to take the shares comprised in the renunciation.

4. Nothing in this Article shall apply to the increase of the subscribed capital of the
Company caused by the exercise of an option attached to the debenture issued or
loans raised by the Company:
27
 a. To convert such debenture or loans into shares in the Company; of

b. To subscribe for shares in the Company (whether such option is conferred in

these Articles or otherwise).

PROVIDED THAT the terms of issue of such debenture or the terms of such loans
include a term providing for such option and such term:

a. Either has been approved by the Central Government before the issue of the
debentures or the raising of the loans or is in conformity with the Rules, if any,
made by that Government in this behalf; and

b. In the case of debentures or loans or other than debentures issued to or loans

obtained from Government or any institution specified by the Central
Government in this behalf, has also been approved by a special resolution
passed by the Company in General Meeting before the issue of the debentures
or raising of the loans.
8.
b. SHARES AT DISPOSAL OF THE DIRECTORS

Subject to the provisions of section 81 of the Act and these Articles, the shares in the capital
of the Company for the time being shall be under the control of then Directors who may
issue, allot or otherwise dispose of the same or any of them to such persons, in such
proportion and on such terms and conditions and either at a premium or at par or (subject to
the compliance with the provisions of section 79 of the Act) at a discount and at such time as
they may from time think fit and with the sanction of the company to call for any shares
cither at par or premium during such time and for such consideration as then Directors, think
fit, and may issue and allot shares in the capital of the Company on payment in full or part of
any property sold and any services transferred or for rendered to the company be in the
conduct of its business and any shares issued as fully paid up shares and if so issued, shall be
deemed to be fully paid shares. Provided that option or right to call of shares shall not be
given to any person or persons without the sanction of the General Meeting.

COMMISSION AND BROKERAGE

9. a. The company may exercise the powers of paying commissions conferred by
section76 provided that the rate percent, or the amount of the commission paid or
agreed to be paid shall be disclosed in the manner required by that

b. The rate of commission shall not exceed the maximum percentage provided for in
the section 76 of the Act or any statutory modifications thereof

28
 c. The commission may be satisfied by the payment of cash or the allotment of fully
or partly paid shares or partly in the one way and partly in the other

d. The company may also, on any issue of shares, pay such brokerage as may be
lawful.

CERTIFICATES

LIMITATIONS OF TIME FOR ISSUE OF CERTIFICATES

10. Every member shall be entitled without payment, to one or more certificates in
marketable lots, for all the shares of each class or denomination registered in his
name, or if the Directors so approve (upon paying such fee as the Directors may from
time to time determine) to several certificates, each for one or more of such shares
and the company shall complete and have ready for delivery such certificates within
three months from the date of allotment, unless the conditions of issue thereof
otherwise, transmission, sub-division, consolidation or renewal of any of its shares of
transfer, transmission, sub-division, consolidation or renewal of any of its shares as
the case may be. Every certificate of shares shall be under the seal of the company
and shall specify the numbers and distinctive numbers of shares in respect of which it
is issued and amount paid up thereon and shall be in such form as the Directors may
prescribe or approve, provided that in respect of a share or shares held jointly by
several persons, the company shall not be bound to issue more than one of several
joint holders shall be sufficient delivery to all such holders.

ISSUE OF NEW CERTIFICATE IN PLACE OF ONE DEFACED, LOST

OR DESTROYED

11. If any certificate be worn out, defaced, mutilated or torn if or there be no further space
on the back thereof for endorsement of transfer, then upon production and surrender
thereof to the company, a new certificate may be issued in lieu thereof, and company
and on execution of such indemnity as the company deem adequate, being given, and
a new certificate in lieu thereof shall be given to the party entitled to such lost or
destroyed certificate. Every certificate under the Articles shall be issued without
payment of fees if the Directors so decide, or on payment of such (not exceeding
Rs.2/- for each certificate) as the Directors shall prescribe. Provided that no fee shall
be charged for issue of new certificates in replacement of those which are old,
decrepit or worn out or where there is no further space on the back thereof for
endorsement of transfer.

Provided that notwithstanding is stated above the Directors shall comply with such
Rules or Regulation or requirements of any Stock Exchange or the Rules made under
the Act or the rules made under Securities Contracts (Regulation) Act, 1956 or any
other Act, or rules applicable in this behalf.

29
 The provisions of this Articles shall mutatis mutandis apply to debentures of the
Company.

12. Every share certificates shall be issued under the common seal of the Company and in
accordance with the Companies Issue of Share Certificates Rules 1960 or any
modifications thereof for time being in force.

13. No fees shall be charged:

a. For registration of transfers, or sub division and consolidation of certificates and for
sub-division of letters of allotment, renounceable letters of right and split
consolidation renewals and transfer into denominations of the market lot of trading.

b. For issue of new certificates in replacement of those which are old, decrepit or worn
out or whether the cages on the reverse for recording transfer have been fully utilised.

c. For registration of any power of attorney probate, letters of administration or similar

other documents.

CALLS OF SHARES

14. The Board, may from time to time, make calls upon the members in respect of money
unpaid on their shares (whether on account of the nominal value of the shares or by
way of premium) and not by the conditions of allotment thereof made payable at fixed
times.

15. .
a. The Company shall give to its members at least thirty days’ notice, specifying the
time or times and place of payment, and each member shall pay to the company, at
the time or times and place so specified, the amount called on his shares.

b. Joint holders of a share shall be jointly and severally liable to pay all calls in
respect thereof.

16. A call may be revoked or postponed at the discretion of the Board.

17. A call shall be deemed to have been made at the time when the resolution of the
Board authorising the call was passed and may be required to be paid by instalments.

18. a. If a sum called in respect of a share is not paid before or on the day appointed for
payment thereof, the person from whom the sum is due shall pay interest thereon from

30
 the day appointed for payment thereof to the time of actual payment at fifteen percent
per annum or at such other rate as the Board may determine.

b. The Board shall be at liberty to waive payment of any such interest wholly or in
part.

PAYMENT IN ANTICIPATION OF CALL MAY CARRY INTEREST

c. The Directors may, if they think fit, subject to the provisions of Section 92 of the
Act, agree to and receive from any member willing to advance the same whole or any
part of the moneys due upon the shares held by him beyond the sums actually called
for, and upon the amount so paid or satisfied in advance, or so much thereof as from
time to time exceeds the amount of the calls then made upon the shares in respect of
which such advance has been made, the company may pay interest at such rate, as the
member paying such sum in advance and the Directors agree upon provided that
money paid in advance to calls may shall not conform a right to participate in profits
or dividends. The directors at any time repay the amount so advanced.

The members shall not be entitled to any voting rights in respect of the moneys so
paid by him until the same would but for such payment, become presently payable.

The provisions of these Articles shall mutatis mandis mantis apply to the calls on
debentures of the Company.

19. a, Any sum which by the terms of issue of a share becomes payable on allotment or
at any fixed date, whether on account of the nominal value of the share or by way of
premiums shall, for the purposes of these regulations, be deemed to be a call duly
made and payable on the date on which, by the terms of issue, such sum becomes
payable.

b. In case of non-payment of such sum, all the relevant provisions of these

regulations as to payment of interest and expenses, forfeiture, or otherwise shall apply
as if such sum had become payable by virtue of a call duty made and notified.

20. On the trial or hearing of any action for the recovery of any money due for any call, it
shall be sufficient to prove that the name of the members used is entered in the
Register as the holder, or one or the holders of the shares in respect of which such
debt is accrued; that the resolution making the call is duly recorded in the minute
book; and that notice of such call is duly given to the member sued and it shall not be
necessary to prove the appointment of the Directors who made such call nor any other
maters whatsoever but the proof of the matters required to be proved aforesaid shall
be conclusive evidence of the debt.

31
 THE BOARD
21. a. may, it if thinks fit, receive any member willing to advance the same all or any part
of the monies uncalled and unpaid any shares held by him and

b. upon any of the money so advanced may (until the same would, but for such
advance, become presently payable) pay interest at such rate as may be agreed upon
between the Board and the member paying the sum in advance.

c. No such sum, paid in advance of calls, entitle the member paying such sum to any
portion of a dividend in respect of any period prior to the date upon which such sum
would but for such payment become presently payable.

d. No member shall be entitled to any voting rights in respect of the monies so paid
by him until the same would but for such payment. become presently payable.

COMPANY’S LIEN ON SHARES/DEBENTURES

22. The Company shall have a first and paramount lien upon all the shares/debentures
(Other than fully paid-up shares debentures ) registered in the name of each member
(whether solely or jointly with others) and upon the proceeds of sale thereof for all
moneys (whether presently payable or not) called or payable at a fixed time in respect
of such shares debentures and no equitable interest in any share shall be created
except upon he footing and condition that this Article will have full effect. And such
lien shall extend to all dividends and bonuses from time to time declared in respect of
such shares debentures. Unless otherwise agreed the registration of a transfer of
shares debentures shall operate as a waiver of the Company's lien if any, on such
shares debentures. The directors may at any time declare any shares/debentures
wholly or in part to be exempt from the provisions of this clause.

23. The company may sell in such manner, as the board thinks fit, and any shares on
which the company has lien.

Provided that no sale shall be made:

a. Unless a sum in respect of which the lien exists is presently payable or

b. Until the expiration o fourteen days after a notice in witing, stating and demanding
payments of such part of the amount in respect of which the lien exists as is presently
payable, has been given to the registered holder for the time being of the share or to
any of the persons entitled thereto by reason of bis death or insolvency

32
24. To give effect to any such sale, the Board may cause and authorise some person to
transfer he share sold to the purchaser thereof and the purchaser shall be registered as
the holder of the share comprised in any such transfer. Upon any such sale as foresaid
the earlier certificate in respect of share sold shall stand cancelled and become null
and void and of no effect, and the Board shall be entitled to issue a new certificate or
certificates in lieu thereof to the purchaser or purchasers concerned. The Purchaser
shall not be bound to see to the application of the purchase money nor shall his title to
the shares be affected by and irregularity or invalidity in the proceedings in reference
to the sale discount provided that the Company will not give to any person the option
to call off any shares without sanction of the share holders of the Company in general
meeting.

25. The net proceeds of any such sale shall be received by the Company and applied m or
towards payments of such part of the amount in respect of which the lien exists as is
presently payable and the residue, if any shall (Subject to a like lien for sums not
presently payable as existed upon the shares, before the sale) be paid to the person
entitled to the shares at the date of the sale.

26. If any member fails to pay any call or instalment of a call on or before the day
appointed for the payment of the same, the Board may, at any time thereafter during
such time as the call or instalment remains unpaid, serve a notice on such member
requiring him to pay the same, together with any interest that may have accrued and
all expenses that have been incurred by the Company by reason of such non-payment.

27. The Notice shall name a further day (not being earlier than fourteen days from the day
of the notice) on or before which the payment required by the notice is to be made.
The notice shall also state that in the event of non-payment on or before the day
appointed, the shares in respect of which such call was made or instalment is payable
will be liable to be forfeited.

28. If the requirements of any such notice as aforesaid are not complied with, any shares
in respect of which such notice has been given, may at any time thereafter, before the
payment required by the notice has been made, be forfeited by a resolution of the
Board to the effect. Such forfeiture shall include all dividends declared in respect of
the forfeited shares and not actually paid before the forfeiture.

29. When any share shall have been so forfeited, notice of the forfeiture shall be given to
the member in whose name it stood immediately prior to the forfeiture or to any of the
persons entitled to the shares by transmission and an entry of the forfeiture with the
date thereof shall forthwith be made in the register, but no forfeiture shall be in any
manner invalidated by any omission to give such notice or to make such entry as
aforesaid.

33
30. a. . A forfeited share may be sold, re-allotted or otherwise disposed of on such terms
and in such manner as the Board thinks fit.

b. At any time, before a sale or disposal as aforesaid the Board may cancel the
forfeiture upon such terms as it thinks fit.

31. A person whose shares have been forfeited shall cease to be a member in respect of
the forfeited shares but shall notwithstanding the forfeiture remain liable to pay all
monies which at the date of forfeiture were presently payable by him to the company
in respect of the shares together with interest at such rate per annum as the Board
shall think ft from the date of forfeiture until payment but his liability shall cease it
and when the company receives payment in full all monies due in respect of such
shares. The Board may, if it shall think fit, remit the payment of such interest or any
part thereof.

32. A duly verified declaration in writing that the declarant is a Director, Secretary or
Manager forfeited on of a the Company, and that certain shares in the Company have
been duly date stated in the declaration shall be conclusive evidence of the facts
Company therein stated may as against all persons claiming to be entitled to the
shares. The receive the consideration allotment or if any given for the share on any
sale, re disposition thereof and may execute a transfer of the share in favour of the
person to whom the share is sold, re-allotted or otherwise disposed off and he shall
there upon be registered as the holder of such share and shall not be bound to see to
the affected application by any of the purchase money, if any, nor shall his title to
such share be irregularity or invalidity in the proceedings in reference to such
forfeiture sale, re-allotment or disposition of the shares.

33. The Provision of these Articles as to forfeiture shall apply in the case of non-payment
of any sum which by the terms of issue of share, becomes payable at a fixed time,
whether on account of the nominal value of a share or by way of premium, as if the
same had been payable by virtue of a call duly made and notified.

TRANSFER AND TRANSMISSION OF SHARES

34. .
a. The shares in the company shall be transferred by an instrument in writing in Form:
No.7B set forth in Annexure A to the Government(s) General Rules and Companies
(Central Forms 1956 or in such other form as may be prescribed from time to time.
The Instrument of stamped and shall be in transfer shall be duly respect of only one
class of shares.

b. Every instrument of transfer shall, before it is signed by or on behalf of the

transferor and by or on behalf of the therein, be presented to transferee and before

34
 any entry is made such authority as the Central Government may, from time to time,
appoint in that behalf for being stamped or otherwise endorsed thereon the date on
which it is so presented.

c. Every instrument of transfer shall, after it is duly stamped, and on behalf of the
executed by or transferor and the transferee and completed in all delivered to the
respects, be company along with the within such time certificate relating to such
shares, from the date of such presentation as may be the Act or within prescribed by
Government under such the extended period as may be granted by the Central
Provisions of this Act.

d. . The transferor shall be deemed to remain the holder of share until the name of the
transferee is entered in the Registrar of members in respect thereof.

e. The company shall not register a transfer of shares of the company, unless a proper
instrument of transfer fully stamped and executed by or on behalf of the transferor
and transferee specifying the same, address and occupation, if any of the transferee
has been delivered to the company along with the certificate relating to the shares or
debentures or if no such certificate is in existence, along with the letter of allotment of
shares provided that where on an application made in Witing to the company by
transferee and bearing the stamp equipped for an instrument of transfer, it is proved to
the satisfaction of the Board of Directors that instrument of transfer signed by or on
behalf of the transferor and the transferee has been lost, the company may register the
transfer on such terms as to indemnity or otherwise as the Board may think fit.

INSTRUMENT OF TRANSFER

f. The instrument of transfer shall be in writing and all provisions of Section 108 of the
Companies Act, 1956 and statutory modification thereof for the time being shall be
duly complied with in respect of all transfer of shares and registration thereof.

NO FEE ON TRANSFER OR TRANSMISSION

g. No fee shall be charged for registration of transfer, transmission, probate, succession

certificate and Letters of administration, Certificate of Death or Marriage, Power of
Attorney or similar other document.

DIRECTORS MAY REFUSE TO REGISTER TRANSFER

35. Subject to the provision of Section 11l of the Act and Section 22A of the Securities
Contracts (Regulations) Act, 1956, the Directors may, at their own absolute and
uncontrolled discretion and by giving reasons, decline to register or acknowledge any
transfer of shares whether fully paid or not and the right of refusal, shall not be

35
 affected by the circumstances that the proposed transferee is already a member of the
Company but in such cases, the Directors shall within one month from the date on
which the instrument of transfer was lodged with the company send to the transferee
and transferor notice of the refusal to register such transfer provided that registration
of transfer shall not be refused on the ground of the transferor being either alone or
jointly with any other person or persons indebted to the Company on any account
whatsoever except when the company has a lien on the shares. Transfer of
shares/debentures in whatever lot shall not be refused.

36. As application for the registration of the shares in the company may be made either by
the transferor or the transferee, where the application is made by the transferor and
relates to partly paid shares, the transfer shall not be registered unless the company
gives notice of the application to the transferee and the transferee makes no objection
to the transfer within two weeks from the receipt of the notice. Notice to the
transferee shall be deemed to have been duly given if it is despatched by prepaid
registered post to the transferee at the address given in the instrument of transfer and
shall be deemed to have been delivered at the time at which it would have been
delivered in the ordinary course of post.

37. No transfer shall be made to an undischarged insolvent or a person of unsound mind

or a partnership in the name of the firm or to a minor.

38. In no case shall the Board be bound to inquire into the validity, legal effect or
genuineness of any instrument of any transfer produced by a person claiming transfer
of share in accordance with these Articles and whether they abstain from so Inquiring
or do so inquire or are misled, the whatsoever upon transferor shall have no claim the
Company in respect of the share except for the previously dividends declare in respect
thereof and not paid.

39. All instruments of transfer which shall be registered, shall be Company, but any
retained by the instrument of transfer which the Directors may decline to shall be
returned to the register person depositing the same. Every instrument of transfer
which is registered shall remain in the custody of the Company until destroyed by
order of the Board.

40. Except as required by law, no person shall be recognised by the Company as holding
any shares upon any trust and the Company shall not be bound by or be compelled in
any way to recognise (even when having notice thereof) any future or partial
equitable, contingent interest in any share, or any interest in any or (except only as by
fractional part of a share these in respect of any regulations or by law otherwise
provided) any other rights share except an absolute right to the entirety thereof in the
registered holder.

36
41. The company shall incur no liability or responsibility whatever in consequence of its
by registering or giving effect to any transfer of shares made or purporting to be made
any apparent legal owner thereof (as shown or appearing in the Register of members)
to be prejudice of persons having or claiming any right, title or interest or in relation
there to or issuing any notice prohibiting registration of such transfer and the
company shall not be bound or required to regard or attend or give effect to any notice
which may be given to it of any right, title or interest or be under any liability
whatsoever for refusing or neglecting so to do though it may have been entered or
referred to in the book of the Company but the Company shall nevertheless, be at
liberty to regard and attend to any such notice, and given effect thereto if the Board
shall so think fit.

42. a. On the death of a member, the survivors where the member was a joint holder, and
his legal representatives where he was a sole holder shall be the only persons
recognised by the company as having any interest in the shares.

b. Nothing in clause (a) shall release the estate of the deceased joint holder from any
liability in respect of any shares which had been jointly held by him with other
persons.

43. a. Any person becoming entitled to a share in consequence of the death or lunacy or
insolvency of a member may, upon such evidence being produced as may from time
to time properly be required by the Board and subject as hereinafter provided, elect
either:

i. to be registered himself as holder of the share, or

ii. to make such transfer of the share as the deceased or insolvent or lunatic
member could have made.

b. The Board shall, in either case have, the same right to decline or suspend
registration as it would have had, if the deceased or lunatic or insolvent member had
transferred the share before his death, lunacy or insolvency.

44. 1. If the person so becoming entitled shall elect to be registered as holder of the share
himself, he shall deliver or send to the company a notice in writing signed by him
stating that he so elects.

2. If the persons aforesaid shall elect to transfer the share he shall testify his election
by executing an instrument of transfer of the same.

3. All the limitations, restrictions and provisions of the Articles relating to the rights
to transfer and the registration of transfer of shares shall be applicable to any such

37
 notice or transfer as aforesaid as if the death, lunacy or insolvency of the member had
not occurred and the notice or transfer were a transfer signed by that member.

5. A person so becoming entitled on transmission to a share by reason of the death,

lunacy or insolvency of the holder shall, subject to the provisions of these Articles and
of section 206 of the Act, be entitled to the same dividends and other advantages to
which he would be entitled if he were the registered holder of the share, except that he
shall not before being registered as a member in respect of it, be entitled to exercise
any right conferred by membership in relation to meeting of the company.

45. The Board of Directors may after giving not less than 7 days previous notice by
advertisement in one newspaper circulating in the district in which the registered
office of the company is situated, close the Register of Members or the Register of
Debenture holders for any period or periods not exceeding in the aggregate forty five
days in each vent but not exceeding thirty days in one time,

DEMATERIALISATION OF SECURITIES
‘45 (A)’

(a) Definitions

"Beneficial Owner" shall have the moaning Assigned thereto in Section 2 of the
Depositories Act, 1996.

"SEBI" 3 means the Securities and Exchange Board of India established under
Section of the Securities and Exchange Board of India Act, 1992.

"Depositories Act" means the Depositories Act, 1996, modifications including any
statutory or re-enactment thereof for the time being in force.

“Bye-Laws" means bye-laws made by a Depository under Section 26 of the

Depositories Act, 1996.

"Depository" shall mean a Depository as defined under clause (e) of Sub Section (1)
of Section 2 of the Depositories Act, 1996.

"Member" means the duly registered holder from time to time of the shares of the
Company and includes every person whose name is entered as a beneficial owner in
the records of the Depository.

"Issuer" means any person marking an issue of the Securities.

38
"Participant" means e person registered as such under Section 12(1A) of the
Securities and Exchange Board of India Act, 1992.

"Registered Owner" means a depository whose name is entered as such in the

Register of the Issue.

"Record" includes the records maintained in the form of books or stored in computer r
in such other form as may be determined by regulation made by SEBI in relation to
the Depsidones Act.

"Regulation" means the regulations made by the SEBI.

“Securities" means such security as many be specified by the SEBI, from time to
time.

“Words and Expression" used and not denied in the Act but defined in the
Depositories Act shall have the same meanings respectively assigned to them in that
Act.

(b) Dematerialisation of Securities

Notwithstanding anything to the contrary or inconsistent contained in these Articles,

the Company shall be entitled to Dematerialise its existing securities, rematerialize its
securities, held in the Depositories and/or offer its fresh securities in a dematerialized
form pursuant to the Depositories Act 1996 and the Rules framed there under, if any.

(c) Company to recognise interest in dematerialised securities under depositories

act

Either the Company or the investor may exercise an option to issue, deal to hold the
securities (including shares) with a Depository in electronic form and the certificates
in aspect thereof shall be dematerialised, in which event the rights and obligations of
the parties concerned and matter connected therewith or incidental thereof, shall be
governed by the provisions of the Depositories Act, as amended from time to time or
any statutory modification thereto or enactment thereof.

(d) Options for investors

Every person acquiring / subscribing to or holding securities of the Company shall

have the option to receive securities certificates or to hold the securities with a
Depository. Such a person who is the beneficial owner of the securities can at any
time opt out of a depository, if permitted by law, in respect of any security in the
Manner provided by Depository Act, and the Company shall, in the manner and

39
within the time prescribed, issued to the beneficial owner the required certificates of
securities.

If a person opts to hold his security with a depository, the Company shall intimate
such depository the details of allotment of the security and on receipt of the
information, the depository shall enter in its records the name of the allottee as the
beneficial owner of the security.

(e) Securities in depositories to be in fungible form

All securities of the Company held by a Depositor sha be dematerialised and be in

fungible form. Nothing contained in Sections 53, 153A, 153B. 187B, 187C 372 and
372A of the Companies Act shall apply to a Depositor in respect of the securities held
by it on behalf of the beneficial owners.

(f) Rights of depositories and beneficial owners

Notwithstanding anything in the contrary contained in the Act or these Articles, a

Depository shall be deemed to be the registered owner for the purpose of effecting
transfer of ownership of securities on behalf of the beneficial owner.

Save as otherwise provided in (a) above , the Depository as the registered owner of
the securities shall not have any voting rights any other rights in respect of the
securities held by it.

Every person holding securities of the Company and whose name is entered as the
beneficial owner in the re4cords of the depository shall be deemed to be a member of
the Company. The beneficial owner of securities shall be entitled to all the rights and
benefits and be subject to all the Liabilities in respect of his securities which are held
as a depository.

(g) Beneficial owner deemed as absolute owner

Except as ordered by a court of competent jurisdiction or as required by law, the

Company shall be entitled to treat the person whose name appears on the Register of
Members as the holder of any share or where the name appears as the Beneficial
owners of shares in the records of the Depository as the absolute owner thereof and
accordingly shall not be bound to recognise ant benami trust of equitability,
contingent. Future or partial interest in any share, or absolute right thereto in
accordance with these Articles, on the part of any other person whether or not it has
expressed or implied notice thereof, but the Board shall be at their sole discretion to
register any share in the joint names of any two or more persons or the survivor or
survivors of them.

40
(h) Depository to furnish information

Every Depository shall furnish to the Company information about the transfer of
securities in the name of the beneficial owner at such intervals and in such manner as
may be specified by the bye-laws and the Company in that behalf.

(i) Transfer of Securities

Nothing contained in Section 108 of the Companies Act 1956 or these Articles shall
apply to a transfer of securities effected by a transferor and transferee both of whom
are entered as beneficial owners in the records of the depository.

(j) Cancellation of certificates upon surrender by a person

Upon receipt of certificate of securities on surrender by a person who has entered into
an agreement with the Depository through a participant, the Company shall cancel
such certificate and substitute in its record the name of Depository as the registered
owner in respect of the said securities and shall also inform the Depository
accordingly.

(k) Option to opt out in respect of any security

If a beneficial owner seeks to opt out of a Depository in respect of any security, the
beneficial owner shall inform the Depository accordingly.

The Depository shall on receipt of information as above make appropriate entries in

its records and shall inform the company.

The Company shall within thirty (30) days of the receipt of intimation from the
Depository and on fulfilment of such conditions and on payment of such fees as may
be specified by the regulations, issue the certificate of securities to the beneficial
owner or the transferee as the case may be.

(l) Service of documents

Notwithstanding anything in the Act or these Articles to the Contrary, where

securities are held in a Depository, the records of the beneficial ownership may be
served by such Depository on the Company by means of electronic mode or by
delivery of floppies or discs.

(m) Provisions of articles to apply to securities held in depository

41
Except as specifically provided in these Articles, the provisions relating to joint
holders of Securities Calls, Lien on securities, forfeiture, Transfer and Transmission
of Securities shall be applicable to Securities held in Depository so far as they apply
to Securities held in physical form subject to the provisions of the Depository Act.

(n) Allotment of securities dealt within a depository

Notwithstanding anything in the Act or these Articles, where Securities are dealt with
by a Depository, the Company shall intimate the details thereof to the Depository
immediately on allotment of such Securities.

(o) Distinctive number of securities held in a depository

The securities in the Capital shall be numbered progressively accordingly to their

several denominations, provided however that the provisions relating to progressive
numbering shall not apply to the Securities of the Company which are dematerialised
Or may be dematerialised in future or issued in future in dematerialised form, except
in the manner herein before mentioned. No securities shall be sub-divided. Every
Forfeited or surrendered Securities held in material form shall continue to bear the
number by which the same was originally distinguished.

(p) Register and index of beneficial owners

The Company shall cause to be kept a Register and index of Members and a Register
and Index and Debenture holders in accordance with Section 151 and 152 of the
Companies Act respectively, and the Depositories Act, with details of Shares and
Debentures held in material and dematerialised forms in media as may be permitted
by law including in any form of electronic media. The Register and Index of
beneficial owners maintained by a Depository under Section 11 of the Depositories
Act shall be deemed to be Register and Index of Member and Register and Index of
Debenture holders, as the case may be for the purpose of the Act. The Company shall
have the power to keep in any State or Country outside India a Branch Register of
Members resident in that State or Country.

(q) Register of transfers

The Company shall keep a Register of Transfers and shall have recorded therein fairly
and distinctly particulars of every Transfer or Transmission of any Securities held in
material form.

(r) Overriding effect of this articles

Provisions of this Articles will have full effect and force notwithstanding anything to
the contrary or inconsistent contained in any other Articles of these present".
42
 GENERAL MEETING

46. All general meetings other than annual general meeting shall be called extra ordinary
general meeting.

47. a. A General meeting of the Company may be called by giving not less than twenty
one day's notice in writing.

b. A General meeting may be called after giving shorter notice than specified in sub
clause (1) if consent in accordance thereto

i. In the case of an annual general meeting by all the members entitled to vote
there at and

ii. In the case of any other meeting, by members of the company holding not less
than 95 percent of such part of the paid up share capital of the company as
given a right to vote at the meeting.

48. The Company shall in each year hold in addition to any other meetings a general
meeting as its annual general meeting and shall specify the meeting as such in the
notice calling it, and not more than 15 months shall elapse between the date of annual
general meeting of the company and that of the next, provided that so long as the
company holds its first annual general meeting within 18 months of its incorporation
it need not hold it in the year of its incorporation or in the following year. Provided
further that the Registrar of Companies or any other competent authority may extend
the time within which any annual general meeting is held by period not exceeding
three months.

49. a. The Board may, whenever it thinks fit, call an extra-ordinary general meeting.

b. If any time there are not within India, Director capable of acting who are sufficient
in number in form a quorum, any director may call an Extra Ordinary General
Meeting in the same manner as nearly as possible, as that in which such a meeting
may be called by the Board.

c. The Board shall on requisition of such number of members as specified in section

69 of the Act call an Extra Ordinary General Meeting.

PROCEEDINGS AT GENERAL MEETINGS

50. a. No business shall be transacted at any general meeting unless a quorum of

members is present at the time when the meeting proceeds to business.

43
 b. Save as herein otherwise provided five members present in person shall be a
quorum.

c. If within half an hour from the time appointed for holding a general meeting a
quorum is not present, the meeting. if called upon the requisition of members, stands
dissolved.

d. In any other case, the meeting shall stand adjourned to the same day in the next
week at the same time and place, or to such other day and at such other time and place
as the Board may determine.

e. If at the adjourned meeting also, a quorum is not present within half an hour from
the time appointed for holding the meeting the members present shall be quorum.

51. The Chairman, is any, of the Board shall preside as Chairman at every General
Meeting of the Company.

52. If there is no such chairman, or if he is not present within fifteen minutes after the
time appointed for holding the meeting or is Meeting or is unwilling to act as
Chairman, the Directors present shall elect one of their number to be Chairman of the
Meeting.

53. If at any meeting no director is willing to act as Chairman or if no director is present

within fifteen minutes after the time appointed for holding the meeting, the members
present shall choose one of their number to be Chairman of the Meeting.

54. 1. The Chairman may, with the consent of any meeting at which a present, and
quorum is shall, if so directed by the Meeting adjourn the meeting from time to time
and from place to place.

2. No business shall be transacted at any business adjourned meeting other than the
business left unfinished at the meeting from which the adjournment took place.

3. When a meeting is adjourned for thirty days or more notice of the meeting
adjourned shall be given as in the case of an original meeting.

4. Save as aforesaid, it shall not be necessary to give any notice of an adjournment or

of the business to be transacted at an adjournment meeting.

55. At any general meeting, a resolution put to the vote of the meeting shall unless a pool
is demanded under section 179 be decided on a show hands.

44
56. In the case of an equality of votes, whether on a show of hands, or on a poll, the
Chairman of the meeting at which the show of hands takes place, or at which the poll
is demanded, shall be entitled to a second or casting vote.

57. Any business other than that upon which a poll has been demanded may be processed
with, pending the taking of the poll.

VOTE OF MEMBERS

58. Subject to the provisions of the Act and these Articles no members, not personally
present, shall be entitled to vote except on a poll unless such member is a body
corporate present by representative duly authorised under section 187 of the Act in
Which case such representative may vote as if he were member of the Company.

59. Subject the aforesaid provisions and to any rights or restrictions for the time being
attached to any class or classes of shares;

a. On a show of hands, every member present in the person shall have one vote,
and

b. On a poll, voting rights of members shall be as laid down in section 87 of the

Act.

60. In the case of joint-holders, the vote of the senior who tenders a vote whether in
person or by proxy shall be accepted to the exclusion of the votes of other joint
holders. For this purpose seniority shall be determined by the order in which the
names stands in the register of members.

61. A member of unsound mind or in respect of whom an order has made by any court
having jurisdiction in lunacy, may vote, whether on a show of hands or on a poll, by
his committee or other legal guardian, and any such committee or guardian may on a
poll, vote by proxy.

62. No member shall be entitled to vote at any General Meeting if the call money or other
sums presently payable by him have not been paid to the Company in respect of any
of the shares held by him whether alone or jointly with any other person.

63. No objection shall be raised to the qualification of any voter except at the meeting or
adjourned meeting at which the vote objected to is given or tendered and every vote
not disallowed at such meeting shall be valid for all purposes. Any objection made in
due time shall be referred to the Chairman of the meeting whose determination
regarding the admission or rejection of the vote, shall be final and conclusive.

45
 PROXY

64. On a poll vote may be given either personally or by proxy.

65. An instrument appointing a proxy shall be in either of the forms in Schedule IX to the
Act or a form as near thereto as circumstances admit.

66. The Instrument appointing a proxy and the power of attorney or other authority , if
any, under which it is signed or a nationally certified copy of that power of authority,
shall be deposited at the Registered office of the company, not less than 48 hours
before the time of holding the meeting or adjourned meeting at which the person
named in the instrument proposes to vote, or in the case of a poll, not less than 24
hours before the time appointed for the taking of the Poll, and in default, the
instrument of proxy shall not be treated as valid.

67. A vote given in accordance with the terms of an instrument of proxy shall be valid,
notwithstanding the previous death or insanity of the principal or the revocation of the
proxy or of the authority under which the proxy was executed, or the transfer of the
shares in respect of which the proxy is given provided that no intimation in writing of
such death, insanity, revocation or transfer shall have been received by the Company
as its office before the commencement of the meeting or adjourned meeting at which
the proxy is used.

DIRECTORS

68. Until otherwise determined by the Company in general meeting the number of
Directors shall not be less than three or more than twelve.

69. The First Directors of the Company shall be:

a. SRI A.VENKATAKRISHNA REDDY

b. SRI M.RAMARAGHAVA REDDY
c. SRI.A.SHYAMASUNDARA REDDY

70. A Director need not hold any share qualification.

71. a. Subject to the provisions of the Act no Director shall be disqualified by his office
from holding any office or place of profit under the Company or under any company
in which the company shall be n shareholder or otherwise interested, or from
contracting with the company cither as vendor. Purchaser or otherwise, nor shall any
such contract or any contract of arrangement entered into by or on behalf of the
Company in which any director shall be in any way interested, by avoided, nor shall
any director be liable to account to the company for any profit arising from any such

46
 office or place of profit or realised by any such contract or arrangement by reason
only of such Director holding that office or of the fiduciary relation thereby
established.

b. The interested Director shall comply with the provisions of section 297, 299, 300
and 314 of the Act wherever applicable.

c. A Director may resign from the Board by stating so in writing and delivering the
same to the company as required under section 51 of the Act. Such resignation shall
take effect after it is accepted by the Board.

RETIREMENT AND ROTATION OF DIRECTORS

72. a. Save as otherwise expressly provide in the Act and these Articles not less than two
thirds of the total number of directors of the company shall be persons whose period
of office is liable to determination by retirement of Directors and be appointed by the
Company in general meeting. The remaining director shall be appointed in the manner
provided elsewhere in these articles.

b. At the first Annual General Meeting of the company all the Directors liable to
retirement by rotation shall retire from office and at every subsequent annual general
meeting one third of such of the Directors for the time being as are liable to retire by
rotation or if their number is not three or a multiple of three, than the number nearest
to one third shall retire from office.

c. Subject to the provisions of the Act and these articles, the director to retire at every
manual general meeting, shall be those who have been longest in office since their last
appointment but as between persons who become directors on the same, day, those
who are to retire shall in default of and subject to any agreement among themselves
be determined by lot. Subject to the provisions of the Act, a retiring director shall
retain office until the dissolution of the meeting at which bis re-appointment is
decided or his successors is appointed.

d. Subject to the provisions of the Act and these articles, a retiring director shall be
eligible for re-appointment.

e. Subject to the provisions of the Act and these Articles, the Company at the Annual
General Meeting at which directors retire may fill up the vacancy by appointing the
retiring director or some other person thereto.

73. A person not being retiring director shall be eligible for director at any appointment to
the office of general meeting if he or some other member intending to propose him as
a Director had not less than fourteen days before the meeting, left at the office of the

47
 company, a notice in witing under his hand signifying his Office candidature for the
of the Director or the intention of such member to propose him as a candidate Tor that
office, as the case may, along with the deposit of Rs.500 or such other sum as may be
prescribed, which shall be refunded to such person or as the case may be to such
member if the person succeeds in getting elected as a Director.

PROCEEDINGS OF THE BOARD

74. A meeting of the Board of Director shall be held at least once in every three months
and at least four such meetings shall be held in every year.

75. a. The Board of Directors may meet for the despatch of business, adjourn and
otherwise regulate its meetings, as it thinks fit.

b. A Director may, and the Manager or secretary on requisition of a Director shall, at

any time summon a meeting of the Board.

76. a. Save as otherwise expressly provided in the Act, questions arising at any meeting
of the Board shall be decided by a majority of votes.

b. In case of any equality of votes, the Chairman of the Board, if any shall have a
second or casting vote.

77. The continuing Directors or sole continuing director may act notwithstanding any
vacancy in the Board; but if and so long as their number falls below the quorum fixed
by these Articles for a meeting of the Board, the continuing Directors, or director may
act for the purpose of increasing the number of Directors to that fixed for the quorum
or of summoning a General Meeting of the company but for no other purpose.

78. a. Subject to Article 75, the Board may elect a determine Chairman of the Board and
the period for which he is to hold office.

b. If no such Chairman is within five minutes elected, or if any meeting the Chairman
is not present after the time directors may choose one appointed for holding the
meeting, the of their members to be the Chairman of the meeting.

79. The Chairman of the Board may be paid such remuneration as may be determined by
the Board.

80. Save as otherwise expressly provided in the Act, a resolution in writing, signed by all
the members of the Board or of a Committee thereof, for the time being entitled to
receive notice of a meeting of the Board or Committed, shall be as valid and effectual
as if it bad been passed at a meeting of Board or Committee, duly convened and held.

48
 BORROWING POWERS OF THE BOARD

81. Subject to the provisions of the Act, the Board may exercise all the powers of the
Company to borrow money and to mortgage or charge to undertaking property and
uncalled capital or any part thereof and to issue debentures, debenture stock and other
securities whether outright or as security for any debt liability or obligation of the
company or of any third part.

82. If any uncalled capital of the company is included in or charged by mortgage or other
security, the Board shall, subject to the provisions of the Act and these Articles, make
calls on the members in respect of such uncalled capital in trust for the person in
whose favour such mortgage or security is executed or if permitted by the Act, and
with the sanction of the company in general meeting may instrument under company's
seal authorise the person in whose favour such mortgage or security is executed or
any other person interest for him to make calls on the members or security is of such
uncalled capital, and the provisions herein before contained in regard to calls shall,
mutatis mutandis, apply to calls made under such authority, and such authority may
be made exercisable either conditionally or unconditionally and whether presently or
contingently and either to the exclusion of the Board's power or otherwise and shall
be assignable if expressed so to be.

83. Whether any uncalled capital of the company is charged, all persons taking any
subsequent charge thereon shall take the same subject to such prior charge and shall
not be entitled by notice to the shareholders or otherwise to obtain priority over such
prior charge.

84. The payment of repayment of money borrowed as aforesaid may be secured in such
manner and upon such terms and conditions in all respect as the Board may think fit
and in particular by a resolution passed at a meeting of the Board (and not by circular
resolution) by the issue of debentures stock of the company charged upon all or any
part of the property of the company (both present and future) including its uncalled
capital for the time being and debentures, debenture stock and other securities may be
made assignable free from any equities between the company and the person to whom
the same may be issued.

TERMS OF ISSUE OF DEBENTURE

85. Any debentures, debenture -stock or other securities may be issued at a discount.
premium or otherwise and may be issued on condition that they shall be convertible
into shares of any denomination and with any privileges and conditions as to
redemption, surrender, drawing, allotment of shares, attending (but not voting) at the
General Meeting, appointment of directors and otherwise Debentures with the right to

49
 conversion into or allotment of shares shall be issued only with the consent of the
Company in the General Meeting by a Special Resolution.

86. The Company shall comply with all the provisions of the Act in respect of the
mortgages or charges created by the company and registration thereof and the transfer
of the debentures of the company and the register required to be kept in respect oi
Such mortgages charges and debentures.

87. If the Directors or any of them or any other person shall become personally liable for
the payment of any sum primarily due from the company, the Directors may execute
or cause of be executed any mortgage, charge or security over or affecting the whole
or any part of the assets of the company by way of indemnity to secure the directors
or persons becoming liable as aforesaid from any loss in respect of such liability.

POWER OF DIRECTOR

88. Subject to the provisions of the Act, the management and control of the Company
shall be vested in the Board who shall be entitled to exercise all such powers, and to
do all such acts, and things the company is authorised to do; provided that the Board
shall not exercise any power or do any such act or thing which is directed or required
by the Act or by any other statue or by the Memorandum of the Company or by these
articles, to be exercised or done by the Company in General Meeting. Provided
further in exercising any such power or doing any such act or thing the Board shall be
subject to the provisions in that behalf contained in the Act, or in any other statue or
in the Memorandum of the Company, or in these articles, or in regulations not
inconsistent there with and duly made by the Company in general meetings but not
such regulation shall invalidate any prior act of the Board which would have been
valid if that regulation had not been made.

89. Any branch of or kind of business which by the Memorandum of Association of the
Company or these Articles is expressly or by implication authorised to be undertaken
by the Company, may be undertaken by the Board at such time or times at it shall
think fit and further may be suffered by it to be kept in abeyance whether such branch
of or kind of business may have been actually commenced or not until the Board may
deem it expedient to commence or proceed with such branch or kind of business.

90. The Board may establish or arrange any contributory or non-contributory pension or
superannuation scheme or pay a gratuity pension or emolument to any person who is
or has been employed by or in the service of the company or any subsidiary of the
Company or to any person who is or has been a director of other officer and holds or
has held salaried employment in the Company or any such subsidiary and the widow
family or dependents of any such person.

50
91. Subject to the restrictions contained in section 292 of the Act, the Board may delegate
any of their power to a committee of Directors consisting of such director or directors
thinks fit or one or more directors and a member or members of the company as to the
Managing Director, the Manager or any other principal officer of the company Or a
branch office or to one or more of them together and it may from time to time revoke
and discharge any such committee either wholly or in part and either as to persons or
purpose. All acts done by any such committee will confirm to any restriction or
requirement that may from time to time be imposed on it by the Board. All acted done
by and such committee in conformity with such regulations and in filament of the
purposes of their appointment but not otherwise., shall have the like force and effect
as if done by the Board.

92. Subject to the provisions of the Act, the Board may, from time to time, as, it may
think fit, delegate to the Managing Director all or any of the powers hereby conferred
upon the Board, other than the powers to make call on members in respect of money
unpaid on their shares and to issue debentures.
.
93. The meetings and proceedings of any such committee consisting of two or more
members shall be governed by the provisions herein contained for regulating the
meeting and proceedings of the Board so far as the same are applicable thereto and
are not superseded by any regulations made by the Board under the last proceeding
articles.

94. All acts done by any meeting of the Board or of a Committee or by any persons acting
as a Director shall, notwithstanding that it shall afterward be discovered that there was
some defect in the appointment and continuance in office of such director or persons
or that they or any of them were disqualified or had vacated office or were not entitled
to vote be a valid as if every such person had been duly appointed or had duly
continued in office was qualified and continued to be a director or officer and was
entitled to vote and had not vacated his office or his appointment had been terminated
provided that nothing in this Article shall be deemed to give validity to acts done by a
director or officer after his appointment has been shown to the Company to be invalid
or to have been terminated.

95. Without prejudice to the general powers and other powers conferred by these presents
It is hereby expressly declared that the Board shall have the following powers that is
to say, power:

a. to pay the costs charges and expenses preliminary and incidental to the
promotion, formation establishment and registration of the company.

b. To purchase or otherwise acquire for the company any property rights or

privileges which the Company is authorised to acquire at such price and
generally on such terms and conditions as they think fit.
51
 c. At their discretion to pay for any property, rights or privileges acquired by or
services rendered to the company either wholly or partially in case or n shares,
bonds, debentures or other securities of the Company and any Such shares
may be paid issued either as fully paid up or with such amount credited as up
thereon as may be agreed upon, and any such bonds debentures or other
securities may be either property of specifically charged upon all or any part
of the Company and its uncalled capital or not so charged.

d. To secure the fulfilment of any contracts or agreements entered into by the

Company by mortgage pledge, hypothecation or charge of all or any of the
property of the company and its uncalled capital for the time being or in such
other manner as they think ft.

e. To appoint and at their discretion remove or suspend such manager,

secretaries, officers, clerks, agents and servants for permanent temporary or
special services as they may from time to time think fit and to determine their
powers and duties and fix their salaries or emoluments and to require security
in such instances and to Such amount as they think fit.

f. To institute, conduct, defend, compound or abandon any legal proceedings by

or against the company on its officers or otherwise concerning the affairs of
the company and also to compound and allow time for payment for
satisfaction of any debts due and of any claims or demands by or against the
company.

g. To refer any claim to demands by or against the company to arbitration and

observe and perform the awards.

h. To make and give receipts releases and other discharges for money, payable to
the company and for the claims and demands of the company.

i. From time to time provide for the management of the affairs of the company
abroad in such manner as they think fit and in particular to appoint any person
to be attorneys or agents of the company with such powers (including power
to sub-delegate) and upon such terns as may be thought fit.

j. to enter into all such negotiations and contracts and rescind and vary all such
contracts and execute and do all such acts deeds and things in the name and on
behalf of the company as they may consider expedient for or in relation of any
of the matters aforesaid or otherwise for the purpose of the company.

96. The Board may subject to the provisions of the Act make such arrangements as it may
think fit for the management of the Company's affairs abroad and for this purpose
52
 appoint local boards, attorneys, agents and fix their remuneration and delegate to
them such powers as the board may deem requisite or expedient.

The Company may exercise all the powers of section 50 of the Act with regard to
having an official seal for use abroad, and such powers shall be vested in the Board.

The Board may also exercise the power of section 157 and 158 of the Act with
reference to the keeping of Foreign Registers.

97. The Board may appoint, at any time and from time to time, by a power of attorney,
under the company's seal, any person to be the attorney of the company for such
purpose and with such power, authorities and descriptions not exceeding those vested
in or exercisable by the Board, or by Act or by Memorandum or by these Articles and
for such period and subject to such conditions as Board may, from time to time, think
fit, and any such power of attorney may contain such provisions for the protection and
convenience of persons dealing with such attorney, as the Board may think fit.

98. All cheques, promissory notes, drafts, hundis, bills of exchange and other negotiable
instruments, and all receipts for money paid to the Company, shall be signed, drawn,
accepted, endorsed or otherwise executed as the case may be, by such persons and in
Such manner as the Board shall from time to time by resolution determined.

99. a. The Board shall have power at any time, and from time to time, to appoint a person
as an additional director, provided the number of the directors and additional directors
together shall not at any time exceed the maximum strength fixed for the Board by the
Articles.

Such person shall hold office only upon the date of next annual general meeting of the
company but shall be eligible for appointment by the Company as a Director at that
meeting subject to the provisions of the Act.

100. The Board shall have power at any time and from time to time to appoint a
person and full a casual vacancy in the office of any director appointed by the
Company in general meeting. Any person so appointed shall hold office only up to the
date up to which the director in whose place he is appointed would have held office if
it had not been vacated.

101. The Board shall have power at any time and from time to time appoint an
alternate director to act for director during his absence for a period of not less than
three months from the state in which meeting of the board are ordinarily held and the
provisions of section 313 shall accordingly apply. The alternate director shall ipso
facto vacate the office if the absent director vacates office as Director.

53
 APPOINTMENT OF MANAGING DIRECTOR(S)

102. The Board may, at any time, subject to approval of Central Govt. where
necessary, appoint one or more of its directors as Managing Director(s) of the
Company for such period and on such terms and conditions, as the Board thinks fit
and subject to the terms of any agreement entered into in any particular case may
revoke such appointment. The Board may also designate them as Joint Managing
Director(S) or by any other designation.

103. In shall the be event of any vacancy arising in the Office of Managing
Director the vacancy where filled by the Board of Directors subject to the approval of
the Central Govt. necessary and the Managing Director so appointed shall hold the
office of the period as the Board of Directors may fix.

104. The Managing Director shall not be liable for retirement by rotation so long as
he holds office as Managing Director but his appointment shall be automatically
terminated if he ceases from any cause to be a Director.

105. The Managing Director shall subject to the provisions of the Act and subject
to such sanction by the Central Government where necessary, receive such
remuneration (where by way of salary, commission or participation in profits, or
partly in one way and part in another) as the Company in general meeting may from
time to time determine.

POWERS OF MANAGING DIRECTOR(S)

106. The Board may entrust to and confer upon a Managing Director any of the
powers exercisable by and upon terms and Conditions and with such restrictions as
they may think fit and either collaterally with or to the exclusion of their own powers
and may from time to time revoke, withdraw, alter or vary all or any of such powers.

107. In the event of there being more than one Managing Director at any time
holding office, whether designated as Managing Director or Joint Managing Director,
or otherwise, then unless otherwise provided by the terms of their appointment or
unless otherwise directly by the Board all the powers vested in the Managing
Director(s) by or under these presents shall be exercisable by either of them severally.
They shall be deemed to hold their office under separate contract of service and
notwithstanding the termination of the office of any of the Managing Director(s), the
other Managing Directors) shall be entitled to act and exercise all the powers
conferred under these present on the Managing Director(s).

54
 WHOLE TIME DIRECTOR(S)

108. Subject to the provisions of the Act and to the sanction of the Central
Government where necessary, the Board may appoint one or more of their directors as
whole time director(s) under such designation as the Board deems fit. The whole time
directors shall perform duties under the control, supervision and directions of the
board and/or Managing Director(s) and exercise powers delegated by the Board
and/or Managing Director. The whole time Directors shall be liable to retire by
rotation.

MANAGER OR SECRETARY

109. (A) Subject to the provisions of the Act:

i. A Manager or secretary may be appointed by the board for such term, at such
remuneration and upon such conditions as it may think fit; and any manager or
secretary so appointed may be removed by the Board.

ii. A Director may be appointed as Manager or Secretary.

(B) A provision of the Act, or these Articles requiring or authorising a thing to be

done by or to a director or the manager or secretary shall not be satisfied by its being
done or to the same person acting both as Director and or in place, of the manager or
secretary.

REMUNERATION OF DIRECTORS

110. Every director shall be entitled to receive out of the funds of the company by
way of sitting fees, as per the provisions of the Act or Rules, from time to time for
every meeting of Board or any committee thereof attended by him. Any Director shall
be entitled to be paid their travelling, hotel and other out of pocket expenses incurred
in connection with their attending the Board and Committee meetings or otherwise
incurred in the execution of their duties as Directors.

111. Any Director who attends any Board or committee meeting shall be entitled to
receive Siting fees and travelling expenses for the adjourned meeting also,
notwithstanding hat he has received the sitting fees and traveling expenses for the
original meeting which was adjourned.

112. The Managing Director(s) whole time Director(s) shall be paid such
remuneration as 118. the Company in General meeting shall determine subject to the
approval of the Central Government wherever necessary.

55
113. The Directors other than the Managing Director, whole time directors may be
paid such remuneration as many be decided by the Board, subject to the limits
prescribed under section 309 of the Act, wherever necessary.

SEAL

114. a. The Board shall provide a common seal of the company and shall provide
Tor its safe custody. The Board shall have power from time to time to destroy the
same and substitute a new seal in lieu thereof.

b. The seal of the Company shall not be affixed to any instrument except by the
authority of a resolution of the Board or of a Committee of the Board authorised by it
in that behalf and except in the presence of at least two Directors and of the Secretary
or such other person as the Board may appoint for the purpose and such directors and
the secretary or other person as aforesaid shall sign every instrument to which the seal
of the Company is so affixed in his presence.

115. The company may have for use in any territory, district or place not situate in
India an official seal which shall be a facsimile of the Common Seal of the Company,
with the addition on its face of the name of the territory, district or place where it is to
be used. The Seal shall be used in the manner provided in section 50.

DIVIDENDS

116. The Company in General meeting may declare dividends but no dividends
shall exceed the amount recommended by the Board.

117. The Board may, from time to time pay to the members such interim divided as
appear to it be justified by the profits of the company.

118. a. The Board may, before recommending any dividend, set aside out of the
profits of the Company such sums as it thinks proper as a reserves which shall, at the
discretion of the Board, be applicable, for any purpose to which the profits of the
Company may be properly applied, and pending such application may, at the like
discretion, either by employed in the business of the company or be invested in such
investment (other than share of the Company) as the Board, may from time to time,
think fit.

b. The Board may also carry forward any profits which it may think prudent not to
dividend, without setting them aside as a reserve.

119. a. Subject to the rights of persons, if any, entitled to shares with special rights
as to dividends, all dividends shall be declared and paid according to the amounts paid

56
or credited as paid on the shares is respect whereof, the dividend is paid but if any so
long as nothing is paid upon any of the shares in the Company, dividends may be
declared and paid according to the shares.

b. No amount paid or credited as paid on a share in advance of calls shall be treated

for the purpose of this regulation as paid on the share.

c. All dividends shall be apportioned and paid proportionately to the amounts paid or
credited as paid on the shares during any portion or portion of the period in respect of
which the dividend is paid but if any share is issued on terms providing that it shall
rank for dividends as from a particular date such shares shall rank for dividends
accordingly.

d. The Board may deduct from any dividend payable to any member all sums of
money, if any presently payable by him to the company on account of calls or
otherwise in relation to the shares of the Company.

e. Unless otherwise directed, any dividend may be paid by cheque or warrant or by a

pay slip or any instrument having the force of cheque or warrant sent through post to
the registered address of the member or person entitled or in case of joint holders to
one of them, first named in the Register in respect of joint holding or to such person
and to such address as the shareholders or the joint shareholders may in writing direct.
Every such cheque or warrant shall be made payable to the person of who it is sent.
The Company shall not be responsible for the loss of any cheque, dividend warrant or
pay slip or receipt sent by post in respect of dividends of the registered address or
addresses communicated to the office beforehand by the forged endorsement of any
cheque or warrant or fraudulent encashment thereof by any other means.

UNPAID OR UNCLAIMED DIVIDEND

f. Where the Company has declared a dividend but which has not been paid or the
dividend warrant in respect thereof has not been posted within 42 days from the date
of declaration to any shareholder entitled to the payment of the dividend, the
Company shall within 7 days from the date of expiry of the said period of 42 days,
open a special account in that behalf in any scheduled bank called "Unpaid Dividend
of Savera Hotels Limited" and transfer to the said account, the total amount of
dividend which remains unpaid or in relation to which no dividend warrant has been
posted.

Any money transferred to the unpaid dividend account of the company which remains
unpaid or unclaimed for a period of three years from the date of such transfer, shall be
transferred by the Company to the general revenue account of the Central
Government. A claim to any money so transferred to the general revenue account may

57
 be preferred to the Central Government by the shareholders to whom the money is
due.

No unclaimed or unpaid dividend shall be forfeited by the Board.

g. No dividend shall bear interest against the company.

120. The Board may retain any dividend or other moneys payable on or in respect
of a share on which the Company has a lien and may apply the same in or towards
satisfaction in the debts/liabilities in respect of which the lien exists.

INTEREST ON CAPITAL

121. Whereby any shares are issued for the purpose of raising money to degree the
expenses of the construction of any works or building or the provision of any plant
which cannot be profitable for a lengthy period, the company may pay interest on so
much of that share as is for time being paid up for the period and subject to the
conditions and restriction mentioned in section 208 of the Act, and may charge the
sum so paid by way of interest to capital as part of the cost of construction of the
work or building or the provisions of plant.

CAPITALIZATION OF PROFITS

122. a. The Company in General Meeting may, upon the recommendation of the
Board resolve.

i. That it is desirable to capitalise any part of the amount for the time being standing to
the credit of any of the company's reserve accounts, including revaluation reserve or
to the credit of the profit and loss account, or otherwise available for distribution: and

ii. That such sum be accordingly set free for distribution in the manner specified in
clause (2) amongst the members who would have been entitled there to if distributed
by way of dividend and in the same preparation.

b. The sum aforesaid shall not be paid in cash but shall be applied, subject to the
provisions contained in clause (3) either in or towards.

1. paying up any by such members amounts for the time being unpaid on any shares held
respectively:

2. paying up in full, unissued sabres of the company to be allotted and distributed,

credited as fully paid up, to and amongst such members in the proportionate aforesaid
or

58
3. Partly in way specified in sub-clause (1) and party in that specified in sub-clause (i).

c. The share premium account and a capital redemption reserve account may, for the
purpose of this regulation, only be applied in the paying up of unissued shares to be
issued to members of the company as fully paid bonus shares.

d. The Board shall give effect to the resolution passed by the Company in pursuance
of this regulation.

e. a. Whenever such a resolution as aforesaid shall have been passed, the Board shall

i. make all appropriation and applications of the undivided profits resolved to be

capitalised thereby, and all allotments and issues of fully paid shares if any;
and

ii. generally do all acts and things required to give effect thereto

b. The Board shall have full power:

i. to make such provisions, by the issued of fractional certificates or by payment

in cash or otherwise, as thinks fit, for the case of shares becoming distributable
in fractions; and also.

ii. to authorise any person to enter, on behalf of all members entitled thereto into
an agreement with the company providing for the allotment to them
respectively, credited as fully paid up, of any further shares to which they may
be entitled upon such capitalization of (as the case may required) for the
payment up by the company on their behalf, by the application thereto of their
respective proportions of the profits resolved to be capitalised of the amounts
or any part of the amounts remaining unpaid on their existing shares.

c. Any agreement made under such authority shall be effective and binding on all
such members.

ACCOUNTS

123. (i) the Board shall from time to time determine whether and to what extent and
at what times and places and under what conditions or regulations, the accounts and
the books of the company, or any of them, shall be open to the inspection of the
members not being directors.

59
 (ii) No members (n0t being a director) shall have any right of inspecting any accounts
or books, or documents, of the company except as conferred by law or authorised by
the Board or by the Company in General Meeting.

SECRECY CLAUSE

124. Every Director, Managing Director, Agent, Auditor, Secretary or other officer
or any person employed by the Company shall, if so required by the Board before
entering upon his duties, or at any time during his term of office, sign a declaration
pledging himself to observe strict secrecy respecting all transactions of the company
and state of the account of the company and in matters relating thereto and shall be
such declaration pledge himself not to reveal any of the matters which comes to his
knowledge in the discharge of his duties except when required so to do by the
Directors or by a Court of Law and except so far as may be necessary in order to
comply any of the provisions in these presents contained.

INDEMNITY

125. Every Director, Managing Director, Agent, Auditor, Secretary or other officer
of the company or any person (whether an officer of the company or not) shall be
indemnified out of the assets of the Company against all liability incurred by him in
defending any proceedings, whether civil or criminal, in which judgement is given in
his given or in which he is acquitted or in connection with any application under
section 633. of the Act in which relief is granted to him by Court.

WINDING UP

126. a. If the company shall be wound up, the liquidator may with the sanction of a
special resolution of the company and other sanction required by the Act, divide
among the contributories, in specie or kind the whole or any part of the assets of the
company whether they shall consist of property of the same kind or not.

For the purpose aforesaid, the liquidator may set such value as he deems fair upon any
property to be divided as aforesaid and may determine how such division shall be
carried out between the members of different class of members.
The liquidator may with the like sanction. vest the whole and any part of assets of the
company in trustees for the benefit of the contributories, or any of them, as the
liquidator, with the like sanction, shall think fit but so that no members shall be
compelled to accept any shares or securities on which there is a lability,

60
 Sl. Name, Address, Description and Occupation Witness to the respective
No of the subscribers signature with address
1 A. Venkatkrishna Reddy
S/o Late. A Jayarami Reddy
36, Prithvi Avenue
Madras- 600018

Sd/- A.VENKATAKRISHNA REDDY

2 A. Shymasundara Reddy Sd/ C.V.NARASIMHAN
S/o Late. A Jayarami Reddy S/o. Late Sri
Bazaar Street, N.C.Venkatachari
Gudur, Nellore Dist. (A.P) Accountant
Hotel Savera
Sd/- A.SHYAMASUNDARA REDDY Mylapore, Madras -600 004.

3 M. Ramaraghava Reddy
S/o Late. M. Darasaradharmi Reddy
Janakirampet,
Gudur, Nellore Dist. (A.P)

Sd/-M.RAMARAGHAVA REDDY

Date: 1st November 1969

61
 CHAPTER 3
DEPARTMENTATION

62
Hotel Savera consists of various departments that provide immense facilities like food,
wellness, hospitality and fitness.

1. THE PIANO – This is city’s largest multi-cuisine buffet restaurant . They provide
a wide variety and salads, pastas, pizzas, desserts, etc.. It has a lot of offer in both
vegetarian and non vegetarian cuisines. It offers Chinese, Continental, sea food,
Mughlai, fast food, North Indian and a lot more. This is well known for its
Sophisticated, Amazing Hospitality, Worth the Price, Good Lighting, Live Kitchen,
Live Music.

2. THE BREW ROOM - A garden restaurant with a coffee house. The Brew
Room is a rather charming and quiet place to relax over a coffee and a snack in the
middle of the city. It is a little bit of Alice's Wonderland in Mylapore. It's got exciting
coffee, fairytale decor & great food.

3. MALGUDI- A Fine-dining restaurant with all four South Indian Cuisines, It serves
delicious and mouthwatering South Indian cuisine from all the South Indian states. It
is a luxurious dining outlet located in the heart of the city. The restaurant has a warm
and inviting ambience. It is just the perfect place to enjoy an amazing meal with your
family and friends.

4. BAY 146- A Rest-lounge with an alluring ambience. It has a very cozy vibe and the
staff are extremely humble and courteous to help with everything. It invites customers
with amenities like Live Band, Live Music, DJ, Outdoor Seating, View, Combos. It is
well known for its Calamari Rings, Cocktails, Beer, Nachos, Paneer Tikka, Drinks,

5. BAMBOO BAR- It is a bar lounge amidst the mesmerizing Bamboo garden. This
offers an absolutle addictive and energetic vibe. It has smashing interiors, carries a
catchy decor and houses some beautiful seating. From the meals prepared in the
kitchen to the drinks blended by the bar tender, they nail it all. It is the favourite
destination for hard-working professionals, cosmopolitan residents and youngsters
looking to have a fantastic time.

6. BODY LYRICS- A fitness and rehab studio with various facilities. Popular with
the health-watchers, the center functions as a rejuvenation hub as well as a fitness
studio. The gym at Body Lyrics is a well-equipped one, with a range of equipments
and well-trained professionals to help you exercise the right way. It has turned out to
be really beneficial for the guests overall.

7. O2 SPA- A day spa center that offers spa and a variety of relaxing massages and
techniques including Stone Therapy and more. It maintains high level of hygiene and

63
 professionalism with highly trained therapists. It helps in relaxation and calms minds
and souls.

8. A CUT ABOVE- A salon that offers professional styling and beauty services. It
provides exciting range of the newest hues-add colour to your life -feel bright and
energised. The unisex saloon offers a wide range of treatments to enhance beauty and
confidence. Our professional crew ensures the personal and professional services to
remain a cut above the rest.

9. INTERNAL AUDIT- It is an independent, objective assurance and consulting

activity that is designed to add value and improve our organization's operations. It is
a process that allows a company to self-select an audit team to carry out the review of
its operations. It provides a check on the whole Internal Control Sysytem,

10. ACCOUNTS- The accounting department refers to the division in a firm that looks
after the preparation of financial statements, maintenance of general ledger, payment
of bills, preparation of customer bills, payroll, and more. In other words, they are
responsible for managing the overall economic front of the business. It is responsible
for recording and reporting the cash flow transactions of a company. This department
has some key roles and responsibilities, including accounts receivable, accounts
payable, payroll, financial reporting, and maintaining financial controls

11. SAFETY AND SECURITY- The protection of life and property, preservation
of peace and good order in the community, enforcement of laws and regulations,
emergency management, planning, facility and data security, personnel clearances,
and community outreach are very important things kept in mind. This department
performs tasks like Inspecting and patroling premises regularly, monitoring property
entrance, authorizes entrance of people and vehicles, reports any suspicious behaviors
and happenings, secures all exits, doors and windows, monitors surveillance cameras.

12. TRANSPORTATION- Savera Hotel does provide an all time accessible

transportation facility. The guests are only expected to inform in prior with all the
details. They also provide airport transportation for their guests. This department has
extremely professional and experienced drivers that help guests throughout their stay.

13. IT- Information technology plays a vital role in the hospitality industry by providing
efficient and effective solutions for a range of tasks, from booking reservations to
managing operations and enhancing customer experiences. It has become very
important for the hospitality industry to keep up with the latest technological
advancements. Both customers and businesses can benefit from advances in
communication, reservations and guest services systems. Technology allows

64
 continuous communication and streamlines the guest experience, from reservation to
checkout.

14. HUMAN RESOURCE- This department assures people to achieve behavior and
performance levels that will enhance an organization’s effectiveness. It is a
management function that helps managers plan, recruit, select, train, develop,
remunerate, and maintain members of an organization. An HR encourages
individuals to set personal goals and rewards, guiding them to shape their behavior in
accordance with the objectives of the organization that employs them. Human
Resource Management was traditionally called Personnel Management, a term that
was used in the restricted sense of hiring and managing employees.

15. BANQUETS- The banquets department in any hotel is the major revenue-
producing department. It concentrates on selling all the hotel facilities to potential
guests. The function of catering is under the direction and control of the banquet
manager. The function is organized within the banquet hall, the size of which varies
from hotel to hotel. Hotel Savera has number of banquet halls where various events
can take place simultaneously.

65
 CHAPTER 4
DATA ANALYSIS
AND
INTERPRETATION

66
 PERFORMANCE ANALYSIS

Performance analysis deals with the use of financial and performance data in evaluating the
current and past performances of the enterprise to assess its sustainability in future.

Performance analysis is a process of making an assessment of the performance and progress

of the employees of the organization. Such an assessment would indicate whether he is
sufficient or not. Performance analysis is also known as merit rating. Performance analysis
shows tools and techniques, such as ratios, cash flow and measures investments and
performance of a business enterprise with the focus on effectiveness by the management.

Performance analysis is based on company’s financial statement. The analysis includes

establishing relationship between past records, comprising and ascertaining future trends.
This analysis can be used for variety of decisions, contracts etc.

The performance of SAVERA HOTEL LIMITED has been analyzed in the following ways:

• Share capital (Shareholder’s funds)

• Income from operations
• Net profit before interest and taxation
• Net profit after interest and taxation

67
 SHARE CAPITAL (SHAREHOLDER’S FUNDS)

Share capital denotes the amount of capital raised by the issue of shares, by the company. It is
collected through the issue of shares. Share capital is the owned capital of the company, since
it is the money of the shareholder and the shareholder are the owners of the company. The
total share capital is divided into small parts and each part is called a share. Share is the
smallest part of the total capital of the company.

(Table 4.1 shows the Share capital of the company)

YEARS RS.(IN
LAKHS)
2016-17 5353.94
2017-18 5543.10
2018-19 5867.99
2019-20 6075.42
2020-21 5801.44

(Chart 4.1 shows the Share capital of the company)

6200

6000

5800

5600 RS.(IN LAKHS)

Column1
5400
Column2
5200

5000

4800
16-17 17-18 18-19 19-20 20-21

INTERPRETATION:

The shareholder’s funds in the company was seen increasing through the years from 2016-17
to 2019-20 which shows the capital being reinvested in the business. A decline in the capital
was seen in the financial year 2021-21, due to the losses which was reduced from reserves
and surplus

68
 INCOME FROM OPERATIONS

It is the income generated from sale of goods or services, or any other use of capital or asset,
associated with the main operation of an organization before any costs or expenses are
deducted. Revenue is shown usually as the top item in an income statement from which all
charges, costs, and expenses are subtracted to arrive at net income also called as sales.

(Table 4.2 shows the Income from operations of the company)

YEARS RS.(IN
LAKHS)
2016-17 6867
2017-18 7311.89
2018-19 7258.42
2019-20 6790.06
2020-21 2076.69

(Chart 4.2 shows the Income from operations of the company)

8000

7000

6000

5000
RS.(IN LAKHS)
4000
Column1
3000 Column2
2000

1000

0
16-17 17-18 18-19 19-20 20-21

INTERPRETATION:

The income from operations of the company increased drastically from 2016-17 to 2017-18
which was slowly seen decreasing through the further years . A furthermore decline in the
income from operations was seen in the financial year 2021-2021, due to the covid pandemic.

69
 NET PROFIT BEFORE INTEREST & TAXATION

Profit before tax is the profitability measure that looks at the company’s profit before the
company has to pay corporate income tax by deducting all expenses from revenue and
including interest expenses and operating expenses except from income tax. Also referred to
as “Earning before tax” or “pre-profit tax”, this measure combines all of the company’s profit
before tax, including operating, non-operating, continuing operations, and non-continuing
operation

(Table 4.3 shows the Profit before taxation of the company)

YEARS RS.(IN
LAKHS)
2016-17 460.30
2017-18 679.93
2018-19 926.41
2019-20 590.38
2020-21 (453.77)

(Chart 4.3 shows the Profit before taxation of the company)

1000

800

600

400 RS.(IN LAKHS)

200 Column1

0 Column2
16-17 17-18 18-19 19-20 20-21
-200

-400

-600

INTERPRETATION:

The net profit before tax of the company was seen positively growing through the years from
2016-17 to 2018-19 and soon a decline was detected from 2019. The same was already seen
taking a downfall and the company faced losses in the year 2020-2021, due to the pandemic.

70
 NET PROFIT AFTER INTEREST & TAXATION

Net Profit after tax is the net profit earned by the company after deducting all expenses like
interest, depreciation and tax. PAT can be fully retained by a company to be used in the
business. Dividends, if declared are paid to the shareholders from this residue.

(Table 4.4 shows the Profit after taxation of the company)

YEARS RS.(IN
LAKHS)
2016-17 237.69
2017-18 513.40
2018-19 628.21
2019-20 427.74
2020-21 (409.80)

(Chart 4.4 shows the Profit after taxation of the company)

800

600

400

200 RS.(IN LAKHS)

Column1
0 Column2
16-17 17-18 18-19 19-20 20-21
-200

-400

-600

INTERPRETATION:

The net profit after tax of the company was seen positively growing through the years from
2016-17 to 2018-19 and soon a decline was detected from 2019. The same was already seen
taking a downfall and the company faced losses in the year 2020-2021, due to the pandemic.

71
 RATIO ANALYSIS

A ratio is a mathematical relationship between two items expressed in a quantitative form.

Ratio can be defined as “Relationships expressed in quantitative terms, between figures
which have cause and effect relationship or which are connected with each other in some
manner or other.” Ratio analysis is a process of determining and presenting the relationship
of items and groups of items in the financial statement. A ratio is worked out by dividing one
number by another number. Accounting ratios measures and indicate the efficiency of an
enterprise in all aspects.

CLASSIFICATION OF RATIOS:
The basis for classification under this head is the key purpose for which the ratios are
calculated.

CLASSIFICATION OF RATIOS BY PURPOSE AND FUNCTION:

1. Profitability ratios:
➢ Return on investment
➢ Return on shareholder fund
➢ Profit ratio
➢ Operating ratio

2. Turnover ratios:
➢ Stock turnover
➢ Debtors turnover
➢ Fixed asset turnover

3. Short term solvency:

➢ Current ratio
➢ Liquid ratio

4. Long term solvency:

➢ Proprietary ratio
➢ Debt equity ratio
➢ Fixed asset ratio
➢ Capital gearing ratio

72
ADVANTAGES:
• It clearly shows that the trend of changes in the market position is upward, downward or
static, as it covers a number of previous accounting /financial periods.
• The progress or downfall of a firm is clearly indicated by this analysis
• It assists in preparing financial estimates for the future financial forecasting.
• It facilitates the task of managerial control to a great extent. Ideal or Standard ratios can be
established which can be used as reference points of comparison for a firm’s progress over a
period of time.

DISADVANTAGES:
• Accounting ratio is calculated based on ratio analysis which will be correct only if the
accounting data on which they are based on, are correct.
• In certain cases, ratio analysis might prove to be misleading with regard to profits.
• Continuous fluctuation in price levels (or, purchasing power of money) will seriously affect
the validity or comparison of accounting ratios calculated for different accounting periods
and make such comparisons very difficult.
• There is a lot of diversity in practice as regards to the measurement of ratios.

73
 CURRENT RATIO

The current ratio is a liquidity ratio that measures a company's ability to pay short-term
obligations or those due within one year. It tells investors and analysts how a company can
maximize the current assets on its balance sheet to satisfy its current debt and other payables.
The current ratio is an indication of a firm's liquidity. Acceptable current ratios vary from
industry to industry.

CURRENT RATIO= CURRENT ASSESTS / CURRENT LIABILITIES

(Table 4.5 shows the Current ratio of the company)

YEAR CURRENT ASSETS CURRENT LIABILITIES CURRENT RATIO

2016-17 947.21 1565.63 0.605
2017-18 896.50 1474.58 0.6079
2018-19 912.25 976.23 0.9344
2019-20 1130.13 818.55 1.3806
2020-21 878.21 815.11 1.0774

(Chart 4.5 shows the Current ratio of the company)

1.6

1.4

1.2

1
RATIO
0.8
Column1
0.6 Column2

0.4

0.2

0
16-17 17-18 18-19 19-20 20-21

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 PROPRIETARY RATIO

Proprietary ratio is a type of solvency ratio that is useful for determining the amount or
contribution of shareholders or proprietors towards the total assets of the business. It is also
known as equity ratio or shareholder equity ratio or net worth ratio. The proprietary ratio is a
financial ratio that measures the proportion of a company's total assets that are financed by its
shareholders' equity.

PROPRIETARY RATIO = SHAREHOLDERS' FUNDS / CAPITAL EMPLOYED (OR

NET ASSETS).

(Table 4.6 shows the Proprietary ratio of the company)

YEAR PROPRIETORS FUNDS TOTAL ASSETS PROPRIETORY RATIO

2016-17 5442.78 947.21 5.74611755
2017-18 5543.10 896.50 6.18304518
2018-19 5867.99 863.04 6.79920977
2019-20 6075.42 1130.13 5.37585941
2020-21 5804.44 878.21 6.60939866

(Chart 4.6 shows the Proprietary ratio of the company)

5
RATIO
4
Column1
3 Column2

0
16-17 17-18 18-19 19-20 20-21

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 RETURN ON CAPITAL EMPLOYED

The term return on capital employed (ROCE) refers to a financial ratio that can be used to
assess a company's profitability and capital efficiency. In other words, this ratio can help to
understand how well a company is generating profits from its capital as it is put to use. It is a
good baseline measure of a company's performance. ROCE is a financial ratio that shows if a
company is doing a good job of generating profits from its capital.

RETURN ON CAPITAL EMPLOYED = NET OPERATING PROFIT (OR EBIT) /

CAPITAL EMPLOYED.

(Table 4.7 shows the Return on capital employed of the company)

YEAR EBIT CAPITAL EMPLOYED ROCE (in %)

2016-17 728.56 6355.88 11.46277
2017-18 777.48 5985.05 12.99037
2018-19 926.41 6275.15 14.76315
2019-20 612.97 6465.76 9.480247
2020-21 -411.08 6049.18 -6.7963

(Chart 4.7 shows the Return on capital employed of the company)

20

15

10

RATIO
5 Column1
Column2

0
16-17 17-18 18-19 19-20 20-21

-5

-10

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 DEBT TO EQUITY RATIO

The debt-to-equity ratio shows how much debt a company has compared to its assets. It is
found by dividing a company's total debt by total shareholder equity. A higher D/E ratio
means the company may have a harder time covering its liabilities. It is a leverage ratio that
calculates the weight of total debt and financial liabilities against total shareholders’ equity.
Unlike the debt-assets ratio which uses total assets as a denominator, the D/E Ratio uses total
equity. This ratio highlights how a company’s capital structure is tilted either toward debt or
equity financing.

DEBT/EQUITY = TOTAL DEBT / TOTAL SHAREHOLDER'S EQUITY.

(Table 4.8 shows the Debt to equity ratio of the company)

YEAR TOTAL LIABILITY EQUITY DEBT TO EQUITY RATIO

2016-17 2478.73 5442.78 0.455416
2017-18 1916.53 5543.10 0.345751
2018-19 1383.59 5867.99 0.235786
2019-20 1208.89 6075.42 0.19898
2020-21 1062.85 5801.44 0.183205

(Chart 4.8 shows the Debt to equity ratio of the company)

0.5

0.45

0.4

0.35

0.3
RATIO
0.25
Column1
0.2 Column2
0.15

0.1

0.05

0
16-17 17-18 18-19 19-20 20-21

77
 CASH RATIO

The cash ratio is a measure of the liquidity of a firm, namely the ratio of the total assets and
cash equivalents of a firm to its current liabilities. The metric calculates the ability of a
company to repay its short-term debt with cash or near-cash resources, such as securities
which are easily marketable. It compares a company’s cash and cash equivalents to its current
liabilities and short-term debt obligations with upcoming maturity dates.

CASH RATIO = CASH / CURRENT LIABILITIES

(Table 4.9 shows the Cash ratio of the company)

YEAR CASH CURRENT LIABILITIES CASH RATIO

2016-17 472.05 1565.63 0.301508
2017-18 373 1474.58 0.252953
2018-19 427.93 976.23 0.43835
2019-20 516.24 818.55 0.630676
2020-21 486.17 815.11 0.596447

(Chart 4.9 shows the Cash ratio of the company)

0.7

0.6

0.5

0.4 RATIO
Column1
0.3
Column2

0.2

0.1

0
16-17 17-18 18-19 19-20 20-21

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 CHAPTER 5
FINDINGS,
SUGGESTIONS AND
CONCLUSION

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 FINDINGS

 Savera Hotel was started as a partnership firm in 1965 and slowly grew into a private
limited company and now finally coverted into a public limited company.

 The hotel expanded its branches gradually and now is a successful 4 star hotel located
in Mylapore, Chennai, that has over 15-20 departments that are work together to help
this organisation standing stable.

 The company does follow a very systematic and procedural organizational structure
and way of operating.

 The company was seen growing financially over the years until the covid pandemic
hit, and now it continues to work harder to get back on track.

 Based on the performance analysis , the company has a whole moved positively
towards growth, but in the year 2020-2021, it faced a downfall due to the unfortunate
pandemic.

 The shareholder’s funds were seen increasing up until the year 2020, that indicated
reinvestment in business and slowly a slight decline in the year 2020-2021.

 Income from investments had a rough graph with drastic changes faced by the
company wherein sudden inclination was detected from year 2016-2017 to 2017-2018
and after slight consistency, a serious decline was seen from 2019-2020 to 2020-2021.

 Net profit before taxation and after taxation was seen turning negative in 2020-2021,
that resulted in the company facing losses.

 The company provides incredible incentives that genuinely supports the employees in
leading their lives happily and with full satisfaction.

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 SUGGESTIONS

 The company can put in more efforts and plan strategically in using the assests wisely
and make optimum use of their assests.

 It should also maintain their ratios with consistency and take necessary measures to
keep up with it.

 Performance analysis also had faced drastic changes which can be eliminated on a
certain level.

 A comfortable and respectful work environment for the employees is a trait any
company has to work on keep getting better.

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 CONCLUSION

Hospitality means extending a welcome to travellers or offering a home away from home,
and the word is derived from the Latin word “hospes” meaning visitor or stranger. The
hospitality and tourism industry is a vast sector that includes all the economic activities that
directly or indirectly contribute to, or depend upon, travel and tourism.

It is a unit of Savera Industries Ltd, which is more than four-decade strong multidisciplinary
group of companies, based in Chennai. Apart from having a strong hold in the Hospitality
sector, the management has diversified interests in mining, education, health and wellness as
well.

The hotel has a corporate social responsibility entity named Savera Hotel Academy
established to guide students towards a career in hospitality industry.
Savera Hotels Limited is providing the welfare measures favourable to the organization and as well as
to labourers too. However there are some of the issues to be addressed in respect of
unfavorable aspects like transportation facility, proper guideline for safetymeasures, about etc.

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