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Friday, June 04, 2010

Thomas Cook - Annual Report - 2009





Your Directors have pleasure in presenting the Thirty-third Annual Report,
together with the Balance Sheet and Profit and Loss Account for the year
ended 31st December 2009.

Rupees in Million

Year ended Year ended
31st December 2009 31st December 2008

Revenues 2247 2588
Profit before Taxation and exceptional items 341 536
Provision for Taxation 114 187
Provision for Deferred Taxation 4 (1)
Provision for Fringe Benefit Tax 1 16
Profit after Taxation and before Exceptional item 222 334
Exceptional item, net of taxation - 32
Profit after Taxation 222 302

Transferred from Reserve U/sec. 80 HHD of
the Income Tax Act, 1961 15 18

Transferred to General Reserve 22 34
Proposed Dividend * 80 93
EPS (Basic) after exceptional items 1.06 1.76
EPS (Diluted) after exceptional items 1.03 1.71

* Includes preference share dividend

Operations & Results:

The global and local markets continued to witness an economic slowdown for
most of 2009. Corporates and individuals alike, remained cautious to spend
on travel due to the downturn. When the confidence level in the economy
went up during the second half of the year, higher Foreign Institution
inflows made the Rupee stronger. Also lot of volatility was witnessed in
Indian Rupee against the major currencies.

For the first time in seven years, the foreign tourist arrivals into India
fell by 3% in 2009 distorting the six-year growth rally.

The first-half 2009 saw a steady decline in bookings in the travel &
tourism industry, particularly due to the November 26, 2008 terror attack
in Mumbai.

Consequently, the revenues reduced by Rs. 341 million to Rs. 2247 million.
Costs were saved by Rs.146 million. Profit before Taxation and exceptional
items reduced by Rs. 195 million to Rs.341 million.

Your Company recorded turnover of Rs. 2247 million and profits before tax
and exceptional item of Rs. 341 million with profit after tax being Rs. 222
million for the year ended 31st December 2009. The basic earning per share
of the Company is Rs. 1.06.

Utilisation of Rights Issue Proceeds:

During the year ended 31st December 2009, the Company allotted 50,650,699
fully paid up equity shares of Re. 1/- each towards Rights issue for cash
at a price of Rs. 35.50 (including a share premium of Rs. 34.50) per equity
share in the ratio of 35 fully paid up equity shares for every 100 fully
paid up equity shares held by the existing shareholders on the record date
27th December 2008. Consequently, the issued and paid up equity share
capital increased to 211,446,569 shares. The Right Issue Proceeds
Utilisation is as below:

Particulars Rs. (in mn) Rs. (in mn)

Inflow: Rights Issue proceeds 1,798.1

Outflow: Preference Share Capital redemption
(including redemption premium dividend and (1,167.6)
dividend distribution tax)

FCNR Loan repayment (423.8)
Repayment of commercial paper/short term borrowings (183.7)
Expenses pertaining to Rights Issue (23.0) (1,798.1)

Lower borrowings, coupled with reduced interest rates negotiations helped
your Company in achieving a reduction in the Interest cost from Rs. 299
million in 2008 to Rs. 149 million in 2009 and consequently, the Company
was able to make savings of Rs.150 million.

Thomas Cook Presence:

As of December 2009 end, Thomas Cook (India) Limited, alongwith its
subsidiaries, continues to be the largest integrated travel group in India
with over 180 locations by way of its own branches, and additional presence
by way of General Sales Agents (GSA's), Preferred Sales Agents (PSA's) and
Franchisee Offices. We have 180 branches located in 72 cities, over 190
GSA's/ PSA's and around 32 Franchisee f offices across India to have a
wider spread and network across the country.

We also have presence in 5 countries outside of India through our
representative offices in USA (New York), Spain (Barcelona & Madrid), UK
(London), Japan (Tokyo) and Germany (Frankfurt), apart from our
subsidiaries in Mauritius and Branch offices in Sri Lanka.

Share Capital Structure:

The share capital structure as of 17th March, 2010 is as follows:

Authorised Capital: Rs. Rs.

34,58,27,060 Equity Shares of Re.1/- each 345,827,060


(i) 11,47,60,000 Class 'A, 4.65% Cumulative
Non-Convertible Redeemable Preference
Shares of Rs. 10/- each 1,147,600,000

(ii) 3,55,294 Class 'B' 0.001% Cumulative
Convertible / Redeemable Preference Shares
of Rs. 10/- each 3,552,940

(iii) 3,02,000 Class 'C' 0.001% Cumulative
Convertible / Redeemable Preference Shares
of Rs. 10/- each 3,020,000

(iv) 12,50,00,000 1% Cumulative Non-Convertible
Redeemable Preference Shares of
Rs. 10/- each 1,250,000,000
Issued, Subscribed and Paid-up Capital:

211,546,569 Equity Shares of Re.1/- each 211,546,569


(i) 3,19,765 Class 'B' 0.001% Cumulative
Convertible / Redeemable Preference Shares
of Rs. 10/- each 3,197,650

(ii) 2,71,800 Class 'C' 0.001% Cumulative
Convertible / Redeemable Preference Shares
of Rs. 10/- each 2,718,000


Employees Stock Option Scheme (ESOP):

With the objective of motivating and retaining key talent in the
organisation and fostering ownership, your Company has framed the Thomas
Cook Employees Stock Option Plan 2007 and pursuant to the same, has granted
stock options to its employees over the years.

The Recruitment & Remuneration Committee administers and monitors the
scheme. The applicable disclosures under the Securities and Exchange Board
of India (Employee Stock Option Scheme and Employee Stock Purchase Scheme)
Guidelines, 1999 ('the Guidelines') are mentioned in the Annexure to the
Directors' Report.

Except for senior managerial personnel and one other person, none of the
employees have received options exceeding 5% of the value of the options
issued during the year ending December 2009. Likewise, during the year, no
employee has been issued share options equal to or exceeding 1% of the
issued capital of the Company at the time of grant.

The Recruitment & Remuneration Committee has, subject to the approval of
the shareholders at the present general meeting, varied the ESOP Scheme
2007 to the effect that all future grantees shall be granted options at a
discount of 10% of the Market Price instead of a 5% discount as provided
for earlier. This is in fine with changes in the market conditions and
towards retaining Key Talent by having a more attractive ESOP Plan. This
price shall apply only to fresh grants being made under the scheme.


Your Directors recommend dividend on the Class 'B' & Class 'C' Preference
shares as per their terms as also seek the ratification of the dividend
paid to holders of 10,50,00,000 1% Cumulative Non-Convertible Redeemable
Preference Shares on redemption. The Directors are also pleased to
recommend a dividend of 37.5% on the equity share capital.

The proposed dividend on the equity capital and preference capital absorbs
Rs. 80 million for dividend & Rs. 14 million for Dividend Tax.

General Reserve

Your Directors have resolved to transfer Rs. 22 million to General Reserve
out of the profits of the Company. With the transfer, the total reserves
stand at Rs. 2508 million as at 31st December 2009.

Directors' Responsibility Statement:

The Directors would like to assure the Members that the financial
statements for the year under review conform in their entirety to the
requirements of the Companies Act, 1956 pursuant to Section 217 (2AA) and

1. the Annual Accounts have been prepared in conformity with the applicable
Accounting Standards;

2. the Directors have selected such accounting policies and applied them
consistently except where otherwise stated in the notes to the accounts and
made judgements and estimates that are reasonable and prudent so as to give
a true and fair view of the state of affairs of the Company at the end of
the financial year and of the Profit of the Company for that period;

3. the Directors have taken proper and sufficient care for the maintenance
of adequate accounting records in accordance with the provisions of the
Companies Act, 1956 for safeguarding the assets of the Company and for
preventing and detecting fraud and other irregularities. The internal
auditors have conducted periodic audits to provide reasonable assurances
that established policies and procedures of the Company have been followed.
However, it must be recognised that there are inherent limitations in
weighing the assurances provided by any system on internal controls;

4. the Directors have prepared the annual accounts on a going concern


Thomas Cook Group plc:

Thomas Cook Group plc is a leading international leisure travel group,
created by the merger of MyTravel Group PIC and Thomas Cook AG in June
2007. Thomas Cook Group plc is a fully listed company on the London Stock

Thomas Cook (India) Limited is a part of Thomas Cook Group. It remains as a
subsidiary of TOM Limited, an unlisted private company, incorporated under
the laws of England and Wales having its Registered Office at Peterborough,
England, U.K. and holding 55.84% of the post ESOP Issue paid-up equity
share capital of the Company. Thomas Cook UK Limited (TCUK) apart from
holding 21.44% of the post ESOP Issue paid-up equity share capital of the
Company, also holds 100% holding in TOM Limited. Thus, TCUK indirectly
holds 77.27% of the present paid-up equity share capital of the Company.


Pursuant to intimation from the promoters, the name of the Promoters and
entities comprising the 'group' are disclosed hereinbelow for the purpose
of Regulation 3(1)(e)(i) of the Securities and Exchange Board of India
(Substantial Acquisition of Shares and Takeovers) Regulations, 1997, and
they include the following:


Airtours the Holidaymakers Limited
Thomas Cook Group UK Limited (erstwhile Blue Sea Investments Limited)
Blue Sea Overseas Investments Limited
MyTravel Group Plc
MyTravel UK Limited
Sandbrook Overseas Investments Limited
Sandbrook UK Investments Limited
Thomas Cook Continental Holdings Limited
Thomas Cook Group Plc
Thomas Cook Investments (1) Limited
Thomas Cook Investments (2) Limited
Thomas Cook Overseas Limited
Thomas Cook Scheduled Tour Operations Limited
Thomas Cook Tour Operations Limited
Thomas Cook UK Limited

Thomas Cook (India) Limited

Operations in India [including Travel Corporation (India) Limited]

Consolidation of businesses across the Company and its subsidiaries
continued through 2009.

During the year, new initiatives were taken like the launch of a complete
Print Holidays campaign under the new name 'Holidaywallas'; the venturing
into a new segment - the luxury segment with our new luxury brand
'Indulgence'; launch and/ or continuation of products like 'Honeymoon
Holidays', 'Holyland tours', 'Rock on series'; launch of new luxury train
itinerary, 'The Indian Maharaja - Deccan Odyssey' through our subsidiary
Travel Corporation (India) Limited. The Company also started a new
marketing campaign for Leisure Travel with focus on new products and change
in media mix. A corporate booking tool - the Corporate Travel Module (CTM)
was launched and the Company also undertook a back end integration /
consolidation exercise through the Service Excellence Centre.

The E-Businesses also launched a gamut of new products & services in 2009
catering to various segments of the customers based on their requirements
and travel trends for air and rail ticketing, hotel bookings and branded
international holidays; customisable self-booking tool for Corporates,
modules for the Visa & Passport Services Team.

Operations in Mauritius

The Mauritian subsidiaries have changed their accounting year to a period
of nine months ending 30th September, 2009. During 2009, Thomas Cook
Mauritius Operations Company Limited, the foreign exchange arm of the
Mauritius Holding entity has seen the implementation of a new front-end
business application for its Foreign Exchange business which is under
stabilisation. With the increased network of 20 branches, the operations
company has exceeded its budgets and last year's numbers.

New business has been signed with parties in the market for increasing the
variety of products offered from the branches and the company is further
enjoying increased visibility.

Operations in Sri Lanka Branch

The Sri Lanka branch of your Company offers foreign exchange services from
the arrival and departure lounge of the Bandaranaike International Airport,
Colombo, Sri Lanka and has a staff strength of twenty personnel.

The focus of your Company is to expand its operations beyond the airport by
opening branches in various cities as and when the approvals are received
from the regulatory authorities. Your Company is also seeking to enhance
its scope of license to enable it to play a more constructive role in the
financial system of the country.

Post the end of insurgency in Sri Lanka, the inflow of tourists has started
to increase. Now with a stable Government in place after the recent
elections, the outlook seems positive for the country's economy and your
Company would look to capitalize on it.

Accolades and Awards:

Thomas Cook (India) Limited has been the recipient of the following highly
prestigious awards in 2009:

- CNBC AWAAZ- Best FOREX Company in India

- CNBC AWAAZ - Best Tour Operator for the second time in a row


In accordance with Article 131 of the Articles of Association of the
Company, Mr. H.S. Billimoria, Mr. A.V. Rajwade and Mr. Rakshit Desai retire
by rotation and being eligible, offer themselves for re-appointment to the

Mr. Ramesh Savoor, Mr. Mahendra Kumar Sharma and Mr. Krishnan Ramachandran
were appointed as Additional Directors with effect from 29th May 2009. As
Additional Directors, Mr. Savoor, Mr. Sharma and Mr. Ramachandran hold
office upto the date of the ensuing Annual General Meeting of the Company.

Mr. Vinayak K. Purohit was re-appointed as the Executive Director - Finance
of the Company for a period of three years w.e.f. 14th May, 2010.

The Service Agreements of Mr. Madhavan Menon, Managing Director and Mr.
Rakshit Desai, Executive Director - Travel Services were varied during the

The above appointments, re-appointments and variations form part of the
Notice of the Thirty-third Annual General Meeting and the relevant
Resolutions are recommended for your approval.

Profiles of these Directors, as required by the Listing Agreement
provisions, are given in the Notice/ Corporate Governance Report forming
part of this Annual Report.

During the period, Mr. Udayan Bose, Mr. Manny Fontenla-Novoa, Dr. Juergen
Bueser, Mr. Roland Zeh, Dr. Angus Porter and Mr. Dilip De resigned from the
Company. The Board placed on record its sincere appreciation for the
contribution made by the Directors during their tenure as Directors of the


M/s. Lovelock & Lewes, Chartered Accountants, Auditors of the Company who
retire at the forthcoming Annual General Meeting are eligible for re-
appointment and have expressed their willingness to accept office, if re-
appointed. They have given a certificate to the effect that the re-
appointment, if made, would be within the limits prescribed under Section
224(18) of the Companies Act, 1956. Your Directors recommend their

M/s. Price waterhouse Coopers, Chartered Accountants, Colombo, Sri Lanka,
are recommended for re-appointment as Branch Auditors of the Sri Lanka
Branch of the Company.

Auditors' Report:

Regarding Sub-Clause (i) of Clause (h) of the Auditors' Report, an
application to the Central Government in respect of the appointment and
remuneration of Mr. Rakshit Desai, Executive Director-Travel Services, is
already made and for which approval is pending.

Regarding Sub-Clause (ii) of Clause (h) of the Auditors' Report, relevant
applications to the Central Government in respect of payment of managerial
remuneration to Mr. Madhavan Menon and Mr. Vinayak K. Purohit have already
been made and for which approvals are pending.

The Management has noted the comments on Corporate Travel Module (CTM)
implementation and it is committed to resolving the issues at the earliest.

Subsidiary Companies:

The Audited Statement of Accounts along with the Directors' Report of
Travel Corporation (India) Limited, Thomas Cook Insurance Services (India)
Limited, Thomas Cook Tours Limited, Indian Horizon Travel & Tours Limited
and the Consolidated accounts of Thomas Cook (Mauritius) Holding Company
Limited for the year ended 31st December, 2009 are separately attached as
required under the provisions of Section 212 of the Companies Act, 1956.
The Mauritian subsidiaries have changed their accounting year to a period
of nine months ending 30th September, 2009. Accordingly, the Consolidated
Accounts of Thomas Cook (Mauritius) Holding Company Limited for the nine
months ended 30th September, 2009 are separately attached.

Particulars regarding conservation of energy, technology absorption and
foreign exchange earnings and expenditure.

Your Company being in the Tourism hospitality industry, its activities do
not involve in any expenditure on Technology and Research and Development
and therefore, the other particulars in the Companies (Disclosure of
Particulars in the Report of the Board of Directors) Rules, 1988 are not
required to be submitted.

However, due to the voluntary measures adopted to conserve energy through
an energy audit and consequently implementing its recommendation, your
Company was able to make a savings in its energy l electricity consumption
of 106950 units at the Head Office and 31487 units at its Chembur office.

During the year, the foreign exchange earnings amounted to Rs. 580 million,
whereas, the Company has incurred Rs. 65 million as expenditure in foreign
currencies towards interest, bank charges, licence fees, professional fees,
as well as travelling for promotional activities, subscriptions, etc., as
disclosed in Schedule Q Note 2(h) and 2 (f) in the Notes to the accounts.

Fixed Deposits:

Your Company has not accepted deposits from the Public within the meaning
of Section 58A of the Companies Act, 1956 and as such no amount principal
or interest was outstanding on the date of the Balance Sheet.

Listing of Shares

Your Company is listed on two Stock Exchanges in India viz. Bombay Stock
Exchange Limited, Mumbai and National Stock Exchange of India Limited,
Mumbai. The Company has paid the Listing Fees to both the Stock Exchanges
for the Financial Year 2009-2010.


Relations with the employees continued to be cordial throughout the year.
Your Directors place on record their appreciation of the efforts,
dedication, commendable teamwork and exemplary contribution of the
employees in the various initiatives of the Company and contributing to the
performance of the Company during the year under review.

Information pursuant to Section 217(2A) of the Companies Act, 1956:

The particulars required under Section 217(2A) of the Companies Act, 1956,
read with the Companies (Particulars of Employees) Rules, 1975, forms part
of this Report and have been annexed herewith.

Corporate Governance

Your Company continues to be committed to good corporate governance aligned
with the best corporate practices. It has also complied with various
standards set out by SEBI and the Stock Exchanges where it is listed. The
Management Discussion and Analysis Report forms part of this Annual Report.

For the year ended 31st December, 2009, your Company has complied with the
requirements of Clause 49 of the Listing Agreement and other applicable
rules and regulations with respect to Corporate Governance. A certificate
from the Auditors of the Company regarding such compliance of conditions of
Corporate Governance is attached to this report. The Company is yet to
consider the adoption of 'Corporate Governance Voluntary Guidelines, 2009'
recommended by the Ministry of Corporate Affairs and released at the India
Corporate Week during 14th to 21st December, 2009.

Pursuant to the requirements of Schedule XIII Part II Section II Clause (C)
Proviso (iv) point IV sub-point (2), the following details are being

i) All elements of remuneration package such as salary, benefits, bonuses,
stock options, pension, etc., of all the Directors for the year ended 31st
December 2009:

Executive Directors:

Name of Director A B C D E F G

Mr. Madhavan Menon 5,726,688 9,036,031 - - 859008 15621727 -
Mr. Vinayak K.Purohit 3,533,808 9,420,214 - - 530076 13484098 -
Mr. Rakshit Desai 8,129,004 15,439,155 - - - 23568159 -
Sub-Total (a) 17,389,500 33,895,400 - - 1389084 52673984 -

A = Salary (Rs.)
B = Benefits (Rs.)
C = Bonus/Commission (Rs.)
D = Sitting Fees (Rs.)
E = Pension * (Rs.)
F = Total (Rs.)
G = Stock Options

* Pension includes Superannuation

Non-Executive Directors:

Name of Directors A B C D E F G

Mr. Udayan Bose - - 209,473 120,000 - 329,473 -
Mr. H.S. Billimoria - - 516,603 430,000 - 946,603 -
Mr. A. V. Rajwade - - 516,603 410,000 - 926,603 -
Mr. Dilip De - - 516,603 180,000 - 696,603 -
Mr. Ramesh Savoor - - 307,131 120,000 - 427,131 -
Mr. M. K. Sharma - - 307,131 280,000 - 587,131 -
Mr. Krishnan - - 307,131 60,000 - 367,131 -
Sub-Total (b) - - 2,680,675 1,600,000 - 4,280,675 -
Total (Rs.) (a+b) - - 55,354,659 1,600,000 - 56,954,659 -

A = Salary (Rs.)
B = Benefits (Rs.)
C = Bonus/Commission (Rs.)
D = Sitting Fees (Rs.)
E = Pension * (Rs.)
F = Total (Rs.)
G = Stock Options

* With effect from May, 2005, Commission to the Executive Directors was
paid on the Return on Equity (ROE) formula.

* None of the Directors held any shares in the Company as on 31st December
2009 other than Mr. Madhavan Menon, who held 2000 equity shares as on that

ii) Details of fixed component and performance linked incentives along with
the performance criteria:

Name of Director Salary
Fixed (Rs.) Performance Linked
Incentives (Rs.)

Mr. Madhavan Menon 15,621,727 -
Mr. Vinayak K. Purohit 13,484,098 -
Mr. Rakshit Desai 23,568,159 -
Total 52,673,984 -

Performance criteria:

The Recruitment & Remuneration Committee determines and recommends to the
Board, the compensation of the Directors and employees. The key components
of the Company's Remuneration Policy, as approved by the Recruitment
Remuneration Committee are:

* Compensation is an important element to retain talent.

* Compensation will be competitive and would factor in, the market
compensation levels.

* There will be a variable component in the total Compensation, and that
will be linked to the individual, business and organization performance.

* Compensation will be transparent. fair and simple toadminister.

* Compensation will be fully Legal and Tax compliant, as per the relevant
laws in place.

* ESOPs may be granted having regard to the role / designation, length of
service, past performance record, future potential and/or such other

The shareholders approve the compensation of the Executive Directors for
the entire period of the~r term. The compensation payable to each of the
independent Director is limited to a fixed percentage of profits per year
as recommended by the Recruitment & Remuneration Committee. The aggregate
of these is within the limit of 1% of the net profits of the Company for
the year in respect of Non Executive Directors, calculated as per the
provisions of the Companies Act, 1956, as approved by the shareholders, and
is separately disclosed in the financial statements. The actual amount of
commission payable to each NonExecutive Director is decided by the Board
based on the overall contribution and role of such Directors.

The role and the involvement of the Non-Executive Directors as members of
the Board and its Committees, has undergone qualitative changes pursuant to
more stringent accounting standards and corporate governance norms.
Further, in view of the scale and expertise required for the Company's
business, the Company has paid sitting fees at the rate of Rs. 10,000/- per
meeting to the Non-Executive Independent Directors for attending the
meetings of the Board, Audit Committee, Share Transfer & Shareholders'/
Investors' Grievance Committee and Recruitment & Remuneration Committee
constituted by the Board. With effect from 29th April 2009, sitting fees
for attending Board and Audit Committee Meetings has been increased to
Rs.20,000/- per meeting.

iii) Details of Service Contracts, Notice Period, etc. of all the Directors
for the financial year ended 31st December 2009

Name of Director Service Period Notice Severance fees,
Contract Period if any

Mr. Madhavan Menon Yes 1st May 2009 to 6 months As decided by
30th April 2012 the management

Mr. Vinayak K.Purohit Yes 14th May 2007 to 3 months As decided by
13th May 2010 the management

Mr. Rakshit Desai Yes 25th Nov.,2008 to 3 months As decided by
24th November 2010 the management

Non-Executive Directors No None. The Non- None None
Directors liable
to retire by
rotation, get
re-appointed as
per the Articles
of Association
of the Company
and the Companies
Act, 1956

iv) Stock option details, if any, and whether the same has been issued at a
discount as well as the period over which accrued and over which

Note: None of the non-executive directors were issued/ granted employee
stock options under the Thomas Cook Employee Stock Option Scheme 2007 as on
31st December 2009

Name of the Director A B C D E F

Mr. Madhavan Menon 205000 5% 250500 5% - NA
Mr. Vinayak K.Purohit 162500 5% 185000 5% - NA
Mr. Rakshit Desai - NA - NA - NA

A = 2007 - Options issued
B = 2007 - Discount %
C = 2008 - Options issued
D = 2008 - Discount %
E = 2009 - Options issued
F = 2009 - Discount %

Period of accrual: 1/3rd of the options granted, vest every year, over 3

Exercise Period: All the options are exercisable over a period of 10 years
from the respective grant dates.


Your Directors thank all the Shareholders, Customers, Vendors for their
continued support throughout the year. We also thank Ministry of Tourism,
Reserve Bank of India and other Banks, Financial Institutions, Government
of India, State Governments, and other Government agencies for the support
extended by them and also look forward to their continued support in

Your Directors also wish to place on record their appreciation of the
contribution made by the Company's employees at all levels but for whose
hard work, solidarity and support your Company's consistent growth would
not have been even possible.


MADHAVAN MENON - Managing Director
VINAYAK K. PUROHIT - Executive Director- Finance

Mumbai Dated: 17th March, 2010.

Disclosures under the Securities and Exchange Board of India (Employee
Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999
for the year ended 31st December, 2009

Scheme Name: ESOP 2007 Granted on 25th July 2007 Granted on 10th
July 2008

1. Options Granted 1104125 1414250

2. Pricing Formula 95% of the closing market 95% of the closing
price on that exchange market price on
where higher shares are that exchange
traded where higher
shares are traded
3. Options Vested and
exercisable 542946 364496

4. Options Exercised 13540 0

5. Total number of Ordinary 13540 0
Shares arising as a
result of exercise of

6. Options Lapsed/ 276085 320750

7. Variations of terms The ESOP 2007 Scheme None
of options was amended vide Postal
Ballot Notice dated 21
August 2007 and approved
on 12th October 2007, for
the purposes of recovering
the Fringe Benefit
Tax (FBT) from the
employees and varying
certain terms of the
Scheme according to SEBI

8. Money realised by Rs. 7,026,990.60 N.A.
exercise of the Options

9. Total number of Options 814500 1093500
in force (vested +

Scheme Name: ESOP 2007

1. Options Granted Granted on 20th March 2009

2. Pricing Formula 2194725
95% of the closing market
price on that exchange
where higher shares are traded

3. Options Vested and None vested so far

4. Options Exercised 0

5. Total number of Ordinary 0
Shares arising as a
result of exercise of

6. Options Lapsed/ 126000

7. Variations of terms None
of options

8. Money realised by N.A.
exercise of the Options

9. Total number of Options 2068725
in force (vested +

10. i) Details of Options granted to senior Appendix-A
managerial personnel in 2009

ii) Any other employee who receives in any Appendix-B
One Year of grant of Option amounting to 5%
or more of options granted during the Year

iii) Identified employees, who were granted None
options, during any One Year, equal to or
exceeding 1% of the issued capital
(excluding outstanding warrants and
conversions) of the Company at the time
of the grant

11. Diluted Earning Per Share (EPS) 1.03
calculated in accordance with Accounting
Standard 20 issued by ICAI for the year
ended December 31, 2009.

12. i) Method of calculation of employee Intrinsic Value Method
compensation cost
Reported Profits: 221,647,447
Add: Intrinsic
Value: 3,711,487
ii) Difference between the employee Less: Fair Value: 41,901,176
compensation cost so computed at (i) above Adjusted Profits: 183,457,758
and the employee compensation Reported Basic EPS: 1.06
cost that shall have been recognized Adjusted Basic EPS: 0.87
if fair value of Options had been used Reported Diluted EPS: 1.03
Adjusted Diluted EPS: 0.85
iii) The impact of difference on profits
and EPS of the Company for the year ended
December 31, 2007 had fair value options
had been used for accounting Employee

13. Weighted Average exercise price of Rs. 30.31
options granted during the year is less
than market price of stock on the grant date

14. A description of method and significant assumptions used during the
year to estimate the fair value of Options granted during the year

The fair value of options has been calculated by using Black Schole's
Method. The assumptions used in the above are:

1) Risk free interest Rate 6.73%- 6.90%

2) Expected Life 5.50-6.50 years

3) Expected Volatility based on daily
closing Market Price 49.72%-46.64%

4) Expected Dividend Yield 0.86%

5) The price of underlying share in the market at 31.90
the time of rant

Appendix-A (Details of options granted to and accepted by Senior Managerial

Sr. Name of Senior Designation A B C
No. Managerial Personnel

1. Mr. Madhavan Menon Managing Director 205000 250500 -

2. Mr. Vinayak K.Purohit Executive Director
- Finance 162500 185000 -

3. Mrs. Nalini Gupta President & Head
- Travel Businesses 150000 185000 -

4. Mr. Gautam Sharma President & Head
Financial Services - Marketing & 108750 - -

5. Mr. Parag Mehta President & Head
- Foreign Exchange 108750 100000 -

6. Mr. Amitabh Pandey President & Head
- E-Businesses 63750 86000 116100

7. Dr. D. Prasanth Nair President & Head
Special Projects - Human Resources & 56750 86000 116100

8. Mr. R. R. Kenkare President & Head
Secretary - Legal & Company - - 261375

TOTAL 855500 892500 493575

A = No. of Options Offered and accepted in 2007
B = No. of Options offered and accepted in 2008
C = No. of Options offered and accepted in 2009

Appendix - B (employees, apart from Senior Managerial Personnel, who
received in 2009, grants of Options amounting to 5% or more of options
granted during 2009)

Sr. Name of Employee Designation options %age of
No. offered options
in 2009 offered in

1. Mr. Sunit Suri Chief Operating Officer
- Leisure Travel (Inbound) 122850 5.60%

TOTAL 122850

Employees, apart from Senior Managerial Personnel, who received in 2008,
grants of Options amounting to 5% or more of Options granted during 2008:

Sr. Name of Employee Designation options offered %age of
No. in 2008 options
offered in

1. Mr. Vishal Suri Chief Operating Officer
- Leisure Travel (Outbound) 73000 5.16%
& Domestic

2. Mr. Sunit Suri Chief Operating Officer
- Leisure Travel (Inbound) 78000 5.52%
TOTAL 151000

(Note: There were no employees who received in 2007, grants of Options
amounting to 5% or more of options granted during 2007)


MADHAVAN MENON - Managing Director
VINAYAK K. PUROHIT - Executive Director- Finance

Dated: 17th March, 2010.


India Travel and Tourism Industry:

India's first major civilisation flourished along the Indus River valley
nearly five thousand years ago. in a country as diverse and complex as
India, it is not surprising to find that people here reflect the rich
glories of the past, the culture, traditions and values relative to
geographic locations and the numerous distinctive manners, habits and food
thatwill always remain truly Indian. It is this rich cultural heritage,
natural beauty, diversity of religion and traditional medicare that
attracts visitors from around the world.

The last two years have shown a de-growth over previous years primarily due
to the economic slowdown witnessed in the global and local markets and the
frequent terror attacks.

The travel market is changing dramatically. With the internet, e-mails,
mobile phones and other communication technology becoming a part of daily
lives, a whole world of information and choices are available to today's
travellers, which make it critical for the travel agents to constantly
innovate in order to understand the customer's needs and expectations.

Domestic tourism is growing rapidly. Earlier, one had to plan holidays in
advance. But now, with improved air-connectivity and more options, one can
plan a holiday at short notice and cover long distances. Many destinations
are getting a boost due to their tie-ups with airlines. Many domestic
travellers are making use of the option. The destinations and packages
offered vary according to the season. The travel packages, which were aimed
at luring foreigners to India, are also helping boost domestic tourism like
ayurveda and spa.

Uncertainties such as terror attacks, epidemics, conflicts, natural
calamities and the effects of the global business downturns are risks the
travel and tourism industry will be susceptible to; these perils cannot be
disregarded in the future.

A statement giving Foreign Tourist Arrivals in India and Foreign Exchange
Earnings from tourism for the last eleven years i.e. 1999 to 2009 are given

Foreign Tourist Arrivals and estimated Foreign Exchange Earnings during the
years 1999-2009

Year A B C D E F

1999 2.48 5.2 12951 6.6 3009 2.1
2000 2.65 6.7 15626 20.7 3460 15.0
2001 2.54 -4.2 15083 -3.5 3198 -7.6
2002 2.38 -6.0 15064 -0.1 3103 -3.0
2003 2.73 14.3 20729 37.6 4463 43.8
2004 3.46 26.8 27944 34.8 6170 38.2
2005 3.92 13.3 33123 18.5 7493 21.4
2006 4.45 13.5 39025* 17.8 8634 15.2
2007 5.08 14.3 44360* 13.7 10729* 24.3
2008 5.28 4.0 50730@ 14.4 11747@ 9.5
2009 5.11@ -3.3@ 549600 8.3@ 11394@ -3.0@

A = Foreign Tourist Arrivals (in million nos.)
B = Percentage Change Over Previous Year
C = Estimated Foreign Exchange Earnings (Rs. in Crore)
D = Percentage Change Over Previous Year
E = Estimated Foreign Exchange (in Million US$)
F = Percentage Change Over Previous Year

* Revised Estimates @ Advance Estimates

(Source: Market Research Division of the Ministry of Tourism)

Though the growth rate for 2009 is (-)3 .3%, it is better than UNWTO's
projected growth rate of (-)60/ to (-)4% for the world.


The Ministry of Tourism, Government of India has undertaken several
confidence building measures with a view to giving a boost to the tourism
industry in the aftermath of the global economic slow down and the
terrorist attacks in Mumbai.

The following incentives have been offered by the Ministry to the tourism

a) Enhanced benefits under the Market Development Assistance (MDA) Scheme.

b) Familiarisation (FAM) Tours for Overseas Media and Travel Trade
Representatives: As part of the confidence building measures, FAM tours for
trade and media representatives to Mumbai and other regions of the country
have been specially organized by the overseas India tourism offices, to
project the ground realities relating to safety/security conditions in the

c) Road Shows: A series of Road Shows are being organized in important
tourist generating countries, in collaboration with the Indian Association
of Tour Operators and with participation of different segments of the
tourism industry. The focus of these Road Shows is on one-to-one business
meetings between the seller delegates from India and buyer delegates
overseas, with a view to promoting inbound tourism to India.

d) Visit India Year 2009: The Year 2009 was declared as the Visit India
Year. Diverse and complex cultures, traditions and values; the varied
Indian lifestyles and climatic conditions (eternal snows of the Himalayas,
the peninsula of the far South, the deserts of the West, the humid deltas
of the East, the dry heat and cold of the Central Plateau, the cool forest
foothills); the colourful mosaic of Indian festivals and fairs are just
some of the reasons for people to visit India.

e) Commonwealth Games 2010: To make maximum use of the opportunities=that
will be presented to India when we host the 2010 Commonwealth Games in New
Delhi. The Games are expected to significantly boost tourism in India.

Present Scenario:

India's GDP in 2008-09 declined to 6.7% after a consecutive 9% growth rate
in the preceding three years.

2009 has witnessed a sharp volatility in the Indian Rupee versus the major
currencies. Inflation (WPI), which was at 4.4% at the beginning of 2009,
going negative to -1.6% in June-July 2009 peaked to 7.3% in December 2009.
The Foreign exchange (forex) reserves in foreign currency assets have gone
down from USD 3,489.40 bn in 2008 to USD 3,230.33 bn in 2009.

During 2009, corporates continued to hold back their spends on travel and
entertainment due to recession. Indian leisure travellers remained cautious
in spending on holidays. Recession in the European and US markets affected
the inflow of foreign tourists. Terror attacks in November 2008 kept the
tourists away from India during the first quarter of 2009, which is the
peak tourist season. Volatility in Indian Rupee affected the foreign
exchange margins. All the above impacted the financial performance of your
Company in 2009.


Forex market in India is a regulated market and volumes are closely tied up
to Dollar-Rupee exchange rate.

Your Company is the market leader in forex and offers various services like
currency exchange, money transfer, remittance, Travelers cheques, pay
orders, wire transfers and pre-paid cards.

It caters to the forex needs across various segments of customers such as
leisure outbound travelers, travelers for migration, employment and medical
treatment, students travelling abroad for studies, inbound tourists,
business travelers, banks, non bank retailers and money changers.

Your Company handled 1.3 million transactions in 2009 and is the one of
largest exporter in world for bank notes. It handles 60% of India's foreign
currency bank notes. It has a largest distribution of 172 locations in 70
cities amongst the forex players in the country.

After depreciation in Rupee Vs Dollar in 2008, the year 2009 witnessed a
volatility in Rupee Vs Dollar. It depreciated by 6% during Quarter 1 and
then appreciated by 10% by the year end. As the confidence level in the
economy went up, during the second half of the year, higher Foreign
institution inflows made the Rupee stronger. This impacted our currency
purchase volumes. Although the Indian economy started turning back on track
during the second half, individual and corporate customers remained
cautious in spending the money on travel. Economic slowdown in source
markets affected the inbound tourist inflow. Footfalls at the airports
remained lower than 2008.

Despite the challenges above, your Company was able to sustain the volumes
in 2009 through various initiatives such as U-special, a product for
students going abroad for studies, focusing on various segments for retail
customers, remittance business, expansion into secondary airports, malls,
etc. Margins remained under pressure due to the volume challenges. Costs
were rigorously controlled and were lower than 2008.

The Company has taken a series of initiatives to deliver a sustainable
growth. During 2009, your Company added 51 new sub-agents for inward
remittance business. We have tied up with two large hospitals to open up
kiosks for the foreign exchange. Cochin airport contract was renewed for
five years.

Your Company would like to expand the distribution network further and in
this regard, twenty new shops were opened in last quarter of 2009 in
various tier-2 cities across India. In January'10 we have done a tie-up
with India Post for opening of counters at post offices offering forex and
travel services. We have been awarded the contract to set-up and run
counters at Delhi airport for the next seven years.

Global remittances into India is expected to dip to USD 47 billion as
against USD 52 billion in 2008 on account of a lagged response to a weak
global economy and the opportunity remains for us in this category. Your
Company is a principal agent in India for MoneyGram. We are in the process
of appointing more subagents for MoneyGram.

Volatility in exchange rate, increasingly stringent compliance requirements
and dearth of skilled manpower are some key external factors that could
impact the business adversely. However, the Company is exploring every
possible avenue to mitigate these risks.

Business in Mauritius is growing and during 2009, the company expanded the
branch network, improved the visibility and focused on customer service.

Post the end of insurgency in Sri Lanka, the inflow of tourists there has
started to increase. Now with a stable Government in place after the recent
elections, the outlook seems positive for the country's economy and your
Company would look to capitalize on it. The focus of your Company in Sri
Lanka is to expand its operations beyond the airport by opening branches in
various cities as and when the approvals are received from the regulatory
authorities. Your Company is also seeking to enhance its scope of license
to enable it to play a more constructive role in the financial system of
the country.


The insurance industry has evolved over the past decade through increase in
market penetration and increase in number of insurers and intermediaries.
With innovation in products and processes, insurance players are attracting
a larger audience.

The insurance penetration is still low and provides tremendous potential
especially in the travel space. Your Company will continue to explore the
internal svnergies especially in the leisure travel, corporate travel and
student travel market to drive growth. Moreover, the combination of brick
and mortar shops and worldwide web network provide opportunities for many
more insurance products outside the travel space to be offered to the

The Company continued to explore relevant offerings to our customers
through our partnership with TATA-AIG General Insurance Company. Through
the PLUS product, we now offer wallet and credit card loss coverage to our

In order to leverage on the brand and the network, the life insurance
initiative was started in conjunction with Bajaj Allianz Life Insurance

With the other businesses of Thomas Cook poised for growth and the
Insurance industry itself growing at a CAGR of over 25% (over 98-'99),
this sector offers ample opportunities to leverage upon and create value
for the stakeholders.

Inspite of challenges in terms of Insurance Regulatory

Development Authority guidelines (on commissions) and stiff competition,
the growth rate of the industry continues to remain good.


2009 was an extremely challenging year for most industries; travel and
tourism being no exception. The scale of decline in air traffic volumes was
unlike anything experienced before by the industry, and was on account of a
15%-30% downturn in economic activity in major economies worldwide. The
combined effect dwarfed all the recessions in the past 40 years, and made
this possibly the worst downturn since 1930s.

The number of outbound travellers from India and inbound tourists into
India has shown a de-growth over previous year primarily due to the
economic slowdown witnessed in the global and local markets. Corporates
across the board put a tight leash on travel expenses to manage costs
during the downturn.

While the effects of the downturn were quite pronounced through the first
three quarters, the last quarter showed some signs of recovery. From the
start of the last quarter of 2009, economies started to move out of
recession, particularly the emerging markets; which boosted first air
freight and then air travel. However, the yields have been slow to rise
from the sharp falls of the first half of the year, and fuel prices
continued their upward trend. While load factors were back to pre-recession
levels at the end of the year (partly helped by the festive season),
however, aircraft utilization was down sharply due to fleet expansion.

Your Company took several initiatives to boost demand during the sluggish
period. The Company launched several new products and also launched a
complete media campaign under the new name Holidaywallas' to boost demand
on the leisure side of the business. Continued negotiation with suppliers
helped protect margins. Costs were kept under a tight control with several
initiatives being taken to boost productivity. The Company launched a
Service Excellence Centre', a centralised fulfilment unit for the
corporate travel business to increase efficiency and improve quality.

Most industries and corporates are bullish on 2010 and are expecting
positive growth. With stalled expansion projects and freeze on hiring by
companies, the lift out of recession is seeing business travel being put on
the growth path once again. Domestic yields have already witnessed
significant improvements and international travel is slowly increasing.
Business class travel which had witnessed the sharpest drop is now picking
up once again. With the receding recessionary pressures, the suppressed
demand in leisure is also expected to come back.

Your Company has taken several initiatives to capitalise on this recovery
and deliver sustained growth. The Company is looking to expand its reach
through new outlets and franchisees. Even on the inbound segment, your
Company is looking to develop new source markets to boost inbound passenger

With increasing degree of comfort of customers with internet, online
business is expected to gain increased momentum and increase in volumes.
All Thomas Cook products are available through our website. In addition, a
corporate self booking tool has been launched for smaller corporates who
can directly book their own travel requests, at a lower/marginal service

Your Company will nurture and grow the new product lines and continue to
innovate to meet the needs and expectations of the customers.

Your Company will continue to focus on MICE (Meetings, Incentives,
Conferences and Events) which continues to be a fast growing segment within
leisure travel. Your Company is able to leverage its corporate business to
grow this segment.

Domestic tourism has been growing rapidly in the last few years. The
Company has launched several tour packages to capitalize on the growing
demand from the domestic tourism.

The stronger demand has also led to airlines firming up ticket prices,
which will lead to better yields. The increase in total ticketed volume for
the combined travel businesses, will enable us have better bargaining power
with our principals, to sustain higher revenue margins.

Our customer base is projected to expand with the inclusion of some new
large volume corporates. This, coupled with organic growth and newer
business avenues from our existing large accounts, would help us register
growth during 2010.

Any desperate attempt by competition to eat in our customer base, even on
loss making financials, could affect our growth during the year.

The possibility of oil prices going on an upward trend are a cause of
concern, as any continual rise in fare hikes would lead corporates to prune
their travel budgets during the year by either curtailing number of trips
or travelling on lower class/ low cost airlines.

Any unforeseen global economic downturn, or acts of terror, natural
calamities which may derail the economy, would lead to curtailment of
travel during the year; these perils cannot be disregarded in the future.

The Company will continue to strive in dovetailing its actions and
strategies to take advantage of the ever changing and growing travel
sector, and continue to interact and influence the government, in
continuing to provide the Indian tourists with global bench-marked services
and an appropriate infrastructural platform to the tourism sector.


Your Company set up a separate vertical for visas and passports a little
over a year ago and primarily services the needs of the travellers of the
Travel Businesses. Having established itself internally, the business now
seeks to provide third party services to the travel industry with the
intention of becoming the largest organized player in the market by
leveraging technology in a market which has no organized players with a
pan-India presence.

To facilitate operations, the business has developed a content site
providing detailed information on the country of travel, the contact
details of the foreign missions, downloadable visa forms, check lists of
documents required etc. which can be used by internal and external
customers as well. It also has an end-to-end online tracker for tracking
various stages of the documentation process which is facilitated by bar
coding of the documents, which is a first in the industry.

The outlook of the business is positive considering the revived growth
numbers of outbound travellers in the leisure and business segments.
Missions are also moving towards e-visa in a few cases and these can be
processed only by approved visa agents thereby increasing opportunities for
your Company.

The business faces challenges and risks in the form of biometrics processes
being introduced by some of the Missions which will eliminate the use of
intermediaries. 'Visas on Arrival' being granted to Indians will lead to
fewer visas being processed.


The Company has posted profit before tax (and before exceptional items) of
Rs. 341 million and the profit after tax (after exceptional items) of
Rs.222 million. On a consolidated basis, the profit before tax (and before
exceptional items) stood at Rs.405 million and the profit after tax (after
exceptional items) was Rs. 250 million.


Internal control systems are basically of four types namely Strategic,
Operational, Financial and Legal. All the four types of systems have been
integrated to ensure that the Company's Business Objectives are duly
accomplished. These systems are being regularly reviewed and wherever
necessary are modified or redesigned to ensure better efficiency and
effectiveness. In 2005, our Company implemented an integrated Front Office
System (FOS) - the Project Vector, to give effect to various system level
controls. During the last quarter of 2009. your Company has launched web
based software for our Corporate Travel Management and Leisure Travel
Outbound -GIT business, and the Company is in the process of stabilising
the implementation of the same. During 2009, Thomas Cook Mauritius
Operations Company Limited, the foreign exchange arm of the Mauritius
Holding entity, has seen the implementation of a new front-end business
application for its Foreign Exchange Business, which is under
stabilisation. The front office system and web based applications are
backed by an integrated SAP Accounting System. These twin integrated
systems form the backbone of the overall control environment. Further, user
requirements are taken care of on an on-going basis so as to derive maximum
benefits of these information systems.

The systems are subjected to supervision by the Board of Directors and the
Audit Committee, duly supported by the Corporate Governance, voluntarily
observed since the last two decades and statutorily applicable from the
financial year ending October 2001. Control environment has been well laid
down through written policies pertaining to integrity and business ethics,
prevention of insider trading, anti money laundering and human resources.
These policies are implemented through operational and financial manuals.
Credit Policy is implemented to effectively monitor the Credit Business to
Corporates and thereby effective funds management is ensured. Considering
the key role played by Information Technology in the various business
processes of the Company, proper framework has been provided for the data
security through the information Systems Security Policy laid down by the
Management. Periodical reviews are carried out to ensure effective
implementation of the policy in all the functional areas.

All the systems are subject to Internal Audit by in-house internal Audit
department as well as outside consultants and agencies in the form of Audit
assignments such as Operations audits, Finance and Accounts audits, Support
functions audits, Systems and IT audits, Statutory compliance audits. These
are further supported by the Statutory Auditors who validate that the
financial reporting is true and fair. The President & Head - Legal &
Company Secretary heads the Compliance function, the Vice-President -
Foreign Exchange is the Money Laundering Reporting Officer (MLRO)
overseeing the AML compliance and the Vice-President - BPI & Audit, in
addition to his role as an Internal Auditor, conducts constant spot checks
to ensure that the compliances of all rules and regulations including
business processes are met. Clause 49 Audits are conducted by External
Auditors and their recommendations are implemented for effective Corporate
Governance. The Company has also adopted the system of Concurrent Audit for
its branches in the foreign exchange business with effect from October 2003
as per the requirements of Reserve Bank of India.

Anti Money Laundering Manual for India is in force since 2003 with
revisions therein according to the modified guidelines of RBI. Anti Money
Laundering Manual for Mauritius and Sri Lanka is in force and effectively



Corporate level Risk Matrix is approved by the Board and Company resorts to
Risk Management methodologies to ensure that various business risks,
identified well in time, are assessed for their possible impact and are
effectively mitigated through various control measures. Open risks, if any,
are adequately covered by insurance. Business Continuity Plans (BCPs) have
been designed for the key operations of the Company to address any disaster
event. BCPs are further being reviewed during every. year, for effective

The Company has a Risk Committee chaired by the Managing Director, which
meets monthly, in addition to emergency meetings, whenever required to
address the risk issues relating to various business and support areas and
monitor the critical factors in order to effectively address them. The Risk
Committee approved the risk mapping for India, which lists down major risks
faced by the Company in India and the mitigation controls put in place to
bring down their impact. To address the Information

Systems related risk issues, the Company has constituted information
Systems Security Committee (ISSC) which has its quarterly meetings. Minutes
of the ISSC are put up in the Risk Committee which approves the
recommendations made by the ISSC for implementation. The Risk Committee in
turn reports to the Audit Committee, constituted by the Board.


We have a mix of different hardware (servers - Intel, RISC etc.). These
servers run the day-to-day transaction systems like FOS, SAP, TRIBS& RTF
etc. and also systems which handle e-mail, proxy, Anti Virus etc. We have
software which is internally developed and also have systems developed by
external providers (e.g. TCS). The Company uses various networking service
providers like Airtel-Bharti, Tata, BSNL etc. for its communication needs.
The network is by-and-large a VPN (Virtual Private Network). However,
internet is also used as a method of connecting remote users to our
business applications.

One of the prime concerns on the hardware and software front is that it
should be upgraded in a timely manner so as to be up-to-date with the
prevalent technologies and be ready for supporting the increase and
changing needs of the business. Further, the network has got points of
connect through the internet. Internet being a public domain area, it has a
potential of disrupting our network if proper security measures are not put
in place.

We have used the best technologies and firewalls to ensure that our network
is protected from the vagaries of the internet.

Information Systems Security Committee:

The internal information security is governed by the ISSP (Information
System Security Policy). As noted, the policy is implemented and monitored
by the ISSC. The Committee consists of members from the Business Process
Improvement & Audit department and the Human Resources Department. Member
from the Information Technology (IT) department acts as Rapporteur.

The Committee meets quarterly before each of the Risk Committee Meetings.
It also meets when significant changes take place in the information
Systems and/or Technology that would affect the security and control
perspective favourably/ adversely and on any significant breaches of the
security/ security policy. This Committee has overall responsibility for
all areas concerning IT security.


The Service Quality & Customer Services department has been an independent
department since June 2007 and now reports to the Executive Director-Travel
Services. During this period it has been able to infuse tremendous
awareness in the organization on the need to build a 'Customer Centric'
culture in the organization that provides us with a cutting edge over the
intensifying competition and as a most conspicuous differentiating factor
for the increasing discriminating customers.

Going forward the objective is/will be to leverage the current capabilities
across all the Customer touch points and steer strategically the processes
and technology changes to align the organization with the volatile market
conditions. This has been categorized for action as follows:

* Greater focus on Customer service.

* Ensuring a structured service resolution and Customer retention.

* Track multi channel Customer interactions.

* Recording, Managing and Integrating Customer lifecycle history.

During the year 2009, the department undertook the following initiatives:

INTERNAL & EXTERNAL BENCHMARKING - In order to develop Service Standards,
the department had collated best practices in processes and soft skills
across our Organization and that of our competitors. Continuous improvement
is our main aim in all aspects of our customer interfacing businesses and
we actively seek feedback through customer questionnaires and independent
research in order to analyze and develop our service delivery.

The data from mystery audits and customer feedback were used to develop
Internal and External Benchmarks. The use of market research data and
mystery audits on competition identified the areas of external benchmarks.
This provides us with the knowledge on where we stand vis-a-vis competition
and the capabilities of each Branch.

SEAMLESS CUSTOMER SERVICE AWARDS - The objective of these awards is to
create the importance of customer service by rewarding those employees who
go 'beyond the call of duty'. These awards are collated on a quarterly
basis and culminate in annual awards which also recognize those support
departments that have ably assisted the frontline through the year. There
are various categories of annual awards which recognize branches,
departments and individuals in a transparent and systematic manner. The
annual awards were presented at a large get together of many employees of
the organization.

COMPLAINT MANAGEMENT ANALYSIS - The Complaint Management software that had
been specifically made for the Service Quality & Customer Care department
to capture complaints and their service recovery, thereby ensuring detailed
analysis on the service detractors of the Company. Standard Operating
Procedures have been created and are followed diligently by the Service
Quality department when addressing customer grievances, so as to ensure an
effective recovery of the customers' concerns. There have been a large
number of positive

comebacks to the replies sent to the complaints received from irate
customers, thereby indicating that the detailed responses have a pacifying

UNIFORMS - The department has unveiled new uniforms for all customer
interfacing employees across India, as a well groomed appearance instills
confidence in a customer and projects a positive and efficient outlook to
all. The uniforms have been inspired by those worn in Thomas Cook UK but
have been adapted to suit our needs. These employees are our 'brand
ambassadors' and will wear the uniform with pride and confidence whether at
our retail outlets or at the Corporate customers' locations.

HEALTH & SAFETY - Protecting the health and safety of our customers remains
our primary concern. As part of our endeavour to ensure high levels of
safety for our customers and employees, Thomas Cook has initiated such
focus through dedicated resources in the Organization. The aim is to
develop policies and standards that would adhere to international
requirements for preferred practices and ensure high quality systems to
enable consistent Health and Safety reporting of incidents and accidents
that could arise. In the future, the aim would be to train and develop
appropriate staff to maintain the professional levels of product and
service offerings that we have come to be known for.

CUSTOMER DATA MANAGEMENT - It is essential to capture customer information
in order to leverage for Customer Relationship and Loyalty and thereby
sustain and increase our business; as well as to cross-sell our huge range
of products and services.

In order to create a database of our customers which would be used for any
future Customer Relationship Management solution, a software has been put
in place to capture accurate details of customers, at one source, by the
Sales colleagues at all customer interface touch points across the Thomas
Cook network. The data being inputted is also tracked and managed on a
monthly basis and provided to the relevant departments for updating clients
on new offers.

While we continue on this path of constant improvement, we strive to make
this Company one that 'truly delights' the customer this time and every


Human Resources Management:

Human Resources in Thomas Cook strives to enable the organization to
achieve its objectives by constantly aligning the 'people factor' with the
'business needs'. This creates a need for constantly evolving and
stimulating the systems and processes in the context of organizational
culture. As part of the HR Action plan, we have initiated steps to work on
each of key variables that affect human resources, both at a strategic
level and at an operational level.

The world stands at important crossroads. These are challenging times, and
to retain a competitive edge, a company must direct individual
accomplishment toward organisational objectives. The only sustainable
differentiator of organisational success lies in the Vision and Values of a
company. We must be the force that influences industry standards. In our
kind of business, people come to us with dreams, with plans, with trust,
hoping we will make those dreams come true.

The Thomas Cook Group has defined the Vision of the Group, an inspiration
for each one of us: 'We Go Further to Make Dreams Come True.'

To enable the vision and to provide the context of the kind of organisation
we want to create and the people we want to be, the group also defined the
VALUES'. Thomas Cook India has always prided itself on core values that
act as a foundation to our organisation and we are now re-aligning our
values to reflect that of the Group. Our Values are called the PRIDE

P Pioneering our Future
R Respect for Individuals and United as a team
I Integrity
D Delighting the Customer
E Excellence

The Human Resources Department has rolled out various training initiatives
in its quest that each member of Thomas Cook India will be a torch bearer
for the Vision and Values of our organisation and uphold them with pride
PRIDE' in Thomas Cook.

To drive the future business growth TCIL this year has embarked upon a Key
Talent Plan through which employees are identified as Key Talent based on
performance, potential and criticality. Various interventions are planned
for nurturing those identified and enable them scale up for higher

The organization continued to focus on Training & Development initiatives
at all the levels - The Managerial and Leadership Effectiveness (MILE)
programs launched in collaboration with two of the most prestigious
management institutes in India - the Indian Institute of Management,
Ahmedabad and the Indian Institute of Management, Indore. We run the
program at three levels for Senior, Middle and Entry level Managerial
staff, viz. MILE I, MILE II and MILE III.

The Company continues to nurture talent through TCMLP (Thomas Cook Middle
Leadership Program) and TCETP (Thomas Cook Executive Trainee Program) so as
to create talent pipeline at various levels in junior and middle

We continue with The Thomas Cook Management Education Program (TCMEP) for
those who aspire for higher studies in the Management stream. Towards this,
we have tied up with several Business Management schools, the prestigious
Indian Institute of Management, Kolkata and the Indian Institute of
Management, Kozhikode for Executive MBA programs for our employees. We have
also tied up with ICFAI for Distance MBA. Women employees of Thomas Cook
can apply for a special U21 Scholarship for an Online MBA course with
Singapore University.

We realize that the only sustainable competitive advantage in today's
dynamic, challenging and rapidly changing context is human resources.
Towards that, we are in the process of constantly energizing and
revitalizing our people by equipping them with cutting edge skills,
developing a holistic perspective and imparting in them, a drive for
excellence, so as to enable them to be the best in class and in turn,
facilitate the movement of Thomas Cook India From Good to Great'.

Employee Strength:

The financial year end employee strength was 2305 including those employed
at Sri Lanka, Mauritius, TO and in the Insurance subsidiary.

Employee Relations:

Peaceful and cordial relations continue with the employees. The Management
wishes to place on record its acknowledgement and appreciation for the
support extended by all the employees of the Company.

Your Company is undergoing a transformation in its business models while at
the same time experiencing rapid growth in all aspects. This provides both
opportunities for Thomas Cook to gain the major market share and grow
rapidly, as well as a challenge to maintain profitability and make itself
more cost efficient.


Statements forming part of the Management Discussion and Analysis covered
in this report may be forward-looking within the meaning of applicable
securities laws and regulations. Actual results may differ materially from
those expressed in the statement. Important factors that could influence
the Company's operations include demand and supply conditions, changes in
government regulations, exchange rates, tax laws, monsoon, natural hazards,
economic developments within the country and other factors.


Managing Director Executive Director- Finance

Dated : 17th March, 2010

Jagran Prakashan

Jagran Prakashan



Koutons Retail

Koutons Retail



Redington India

Redington India

Simplex Infrastructures

Simplex Infrastructures

Royal Orchid Hotels

Royal Orchid Hotels

Pre non-farm nervousness in Asian stocks

Most of the indices edge lower as markets await the key data

Asian stocks mostly eased today as mixed cues from the overnight US markets and a continued bout of strength in the US dollar exerted selling pressure on the risky assets ahead of weekends. The traders also eyed the US non-farm payrolls data due later on in the day and the day turned out to be a typical one ahead of the critical data. Markets were given a weaker lead from Wall Street Friday as the Dow edged up just 0.06 % after a mixed bag of reports showing a weekly drop in initial unemployment claims and a disappointing report on private-sector job creation. The nonfarm data would give a much clearer idea of the state of recovery in the world's biggest economy.

The Australian stocks closed lower on mixed movement in commodities and bearish cues from the Asian markets. Banks and financials also slid lower and the benchmark S&P/ASX200 index slipped 0.81 % to 4,449.4, while the broader All Ordinaries index eased 0.75 % to 4,472.4. Banks tumbled across the board with ANZ Banking Group slipping 0.48 % to $22.64, Commonwealth Bank of Australia sliding 0.92 % to $51.47 and Westpac Banking Corporation shedding 1.38 % to $22.76.

The Japanese stocks closed the trading session in negative territory with minor losses, as traders preferred to lock in gains following smart gains in the previous session and move to sidelines awaiting key economic data related to jobs in the U.S later in the day. The benchmark Nikkei 225 Index dropped 13.00 points, or 0.13%, to 9,901, while the broader Topix index of all First Section issues was down 0.48 point, or 0.05%, to 890. The biggest news of the day was that the ruling Democratic Party of Japan chose a leader who could then be confirmed as the country's new prime minister. Finance Minister Naoto Kan looked certain to succeed Yukio Hatoyama -- who resigned on Wednesday over the bungled handling of a US base dispute -- after winning his party's leadership.

In Shanghai, stocks gave up 0.96 %, with heavyweight banks leading the fall amid pressures over the imminent launch of Agricultural Bank's massive initial public offering, dealers said. Many fear the issue could dilute the market with stocks, putting pressure on prices.

In Mumbai, the key benchmark indices pared gains in late trade after hitting 3-week highs. The market breadth was negative. The BSE 30-share Sensex was provisionally up 90.86 points or 0.53%, up close to 190 points from the day's low and off close to 40 points from the day's high. Gains in European shares, higher US index futures and intraday recovery in Asian markets, aided a strong intraday rebound on the domestic bourses. IT, auto and realty stocks reversed initial losses. Banking and FMCG stocks also gained. As per provisional figures, the BSE 30-share Sensex was up 90.86 points or 0.53% to 17,113.90. The Sensex rose 128.09 points at the day's high of 17,150.42 in late trade, its highest level since 14 May 2010. The Sensex fell 58.41 points at the day's low of 16,963.92 in mid-morning trade.

The S&P CNX Nifty was up 21.85 points or 0.43% to 5,132.35 as per provisional figures. It hit a high of 5,147.90 in late trade, its highest level since it's highest since 14 May 2010.

The US dollar appreciated to a fresh four year high today, nearing 1.2100 mark and kept the pressure on the risky assets. The US non-farm payrolls would likely show an increase of 500000, up from 290,000 in April, as the economy mounts a slow recovery from recession.

Oil was under profit selling mode, sliding to a low of $74.12 and currently trades at $74.21, down 40 cents from the previous close. Gold corrected finally today as the expiry of the near month contract took sheen off the metal. The August futures on COMEX quote at $1201 per ounce, down more than 8 dollars after breaking under $1200 mark for a brief period.

BSE Bulk Deals to Watch - June 4 2010

Deal Date Scrip Code Company Client Name Deal Type * Quantity Price **
4/6/2010 505665 ABC Bearings GOLDMAN SACHS INVESTMENTS MAURITIUS I LTD S 101942 105.01
4/6/2010 532975 Aishwarya Tele APARNA NARAYAN B 440329 28.00
4/6/2010 531761 Amulya Leas DEWSOFT OVERSEAS PVT LTD B 99000 38.25
4/6/2010 531761 Amulya Leas ANITA NATHANI B 85000 40.00
4/6/2010 531761 Amulya Leas VINODKUMAR GOYAL S 50000 38.25
4/6/2010 531761 Amulya Leas RENU GOYAL S 55000 38.26
4/6/2010 512247 Ashirwad Cap SWASTI VINAYAKA INVESTECH LIMITED S 200000 2.36
4/6/2010 511607 Birla Shloka PARAM COMMODITIES PRIVATE LIMITED B 65000 71.95
4/6/2010 511607 Birla Shloka MOHAN LAL KARNANI S 65000 71.95
4/6/2010 520115 Brakes Auto KUMAR GUPTA GAURAV B 41000 10.46
4/6/2010 520115 Brakes Auto SL GUPTA AND Co B 25026 10.40
4/6/2010 520115 Brakes Auto SADHANA VIJAY KORE S 29600 10.40
4/6/2010 531337 Channel Guide ADITYA VINOD ROONGTA B 40000 17.47
4/6/2010 531337 Channel Guide ADITYA VINOD ROONGTA S 40000 18.90
4/6/2010 531216 Comfort Intech TAMMANSA D KATWA S 800000 17.17
4/6/2010 532456 Compuage Info JIGNA SANJEEV SHAH B 95874 177.27
4/6/2010 530859 Cosboard Inds OMPARKASH GUPTA B 23916 15.72
4/6/2010 530859 Cosboard Inds OMPARKASH GUPTA S 24529 15.73
4/6/2010 532903 Dhanus Tech BP FINTRADE PRIVATE LIMITED B 128995 17.05
4/6/2010 532903 Dhanus Tech BP FINTRADE PRIVATE LIMITED S 162589 17.43
4/6/2010 532038 Emmsons Intl ATIM KABRA B 23000 122.10
4/6/2010 530117 HK Finechem MONEYBEE COMMODITIES PRIVATE LIMITED S 63558 27.50
4/6/2010 530117 HK Finechem DHIREN S.SHAH (HUF) S 64042 27.53
4/6/2010 509162 Indag Rubber HASINA KASAMBHAI SHEKH B 54689 114.68
4/6/2010 509162 Indag Rubber HASINA KASAMBHAI SHEKH S 54689 114.08
4/6/2010 531777 Intellvisions NEETISH RAMNIKLAL DOSHI. B 90000 18.20
4/6/2010 531777 Intellvisions INDIA MAX INVESTMENT FUND LIMITED S 90000 18.20
4/6/2010 514312 Jaihind Syn RAJESH DINESH SHAH B 25000 10.21
4/6/2010 514312 Jaihind Syn PRASHAM D DOSHI B 42547 10.43
4/6/2010 514312 Jaihind Syn JIGNESH J DHABALIA S 24000 10.21
4/6/2010 530255 KAY Power KAUSHALYA GARG B 85400 15.12
4/6/2010 530255 KAY Power BAMPSL SECURITIES LTD B 71549 15.09
4/6/2010 530255 KAY Power PRAKASHCHAND GUPTA S 90620 15.08
4/6/2010 517471 Koa Tools VIJAY KUMAR MITTAL B 200000 0.40
4/6/2010 517471 Koa Tools SHRIDHAR FINANCIAL SERVICES LIMITED S 200000 0.40
4/6/2010 513355 Marmagoa Steel DESIKACHARI PADMANABHAN B 2100000 5.75
4/6/2010 513355 Marmagoa Steel JAIKRISH INVESTMENTS PVT LTD S 2100000 5.75
4/6/2010 590111 MASTER BALA RAMA VENKATA SIVA NAGA S B 29049 33.06
4/6/2010 522235 Minal Engr BP FINTRADE PRIVATE LIMITED B 64444 28.74
4/6/2010 522235 Minal Engr BP FINTRADE PRIVATE LIMITED S 68987 30.08
4/6/2010 531453 Mohit Inds HITESH SHASHIKANT JHAVERI S 38042 38.57
4/6/2010 531453 Mohit Inds BP FINTRADE PRIVATE LIMITED S 31429 38.44
4/6/2010 500450 MPIL Corp MANORAMA RAMANLAL SHAH B 2927 64.72
4/6/2010 521030 NAKODA SUJATA SYNTHETICS LIMITED B 350000 14.02
4/6/2010 521030 NAKODA SUJATA SYNTHETICS LIMITED S 354194 14.03
4/6/2010 532986 Niraj Cement RUPINDER SINGH GILL B 60000 50.49
4/6/2010 531496 Omkar Overseas PRANALI COMMODITIES PVT.LTD S 30000 83.04
4/6/2010 531496 Omkar Overseas PANKAJ BABULAL KOTECHA S 50000 83.84
4/6/2010 532391 Opto Circuits CREDIT SUISSE (SINGAPORE) LIMITED A/C B 1068390 228.85
4/6/2010 532837 Orbit Corp CREDIT SUISSE (SINGAPORE) LIMITED A/C B 1300000 260.95
4/6/2010 532837 Orbit Corp CLSA (MAURITIUS) LIMITED S 1300000 260.95
4/6/2010 512626 Orbit Exports SHREE VIHAR HOUSING & DEVELOPERS (P) LTD B 68208 29.20
4/6/2010 512626 Orbit Exports IMMORTAL FINANCIAL SERV P LTD S 100000 28.84
4/6/2010 512097 Oregon Comm KRUNAL GOPALDAS RANA B 14000 350.57
4/6/2010 524808 Phyto Chem KIRAN MATTUPALLI B 26085 8.92
4/6/2010 531467 Polypro Fibrils NITABEN KIRTIBHAI PATEL B 30900 28.98
4/6/2010 530331 Premco Glob JITENDRA RAMESHCHAND RASONI B 29000 21.07
4/6/2010 530331 Premco Glob INCAP SECURITIES PVT LTD S 29000 21.07
4/6/2010 511016 Premier Cap PROMETHEUS E SERVICES PRIVATE LIMITED B 12000 66.25
4/6/2010 511016 Premier Cap INNOVA ESERVICES PRIVATE LTD B 6050 66.30
4/6/2010 511016 Premier Cap YUKTI INVESTMENT PRIVATE LIMITED S 18000 66.25
4/6/2010 590077 Ranklin Sol BALA RAMA VENKATA SIVA NAGA S B 41490 82.25
4/6/2010 513558 Real Strips KISHAN GOPAL MOHTA B 26135 54.35
4/6/2010 513558 Real Strips KISHAN MOHTA S 25000 54.20
4/6/2010 526753 Roselabs Inds SPLENDOR VANIJYA PRIVATE LIMITED B 107000 69.74
4/6/2010 533056 SARK SYS S K TRADING (S K CHOURASIA) S 50000 40.00
4/6/2010 533056 SARK SYS MV TRADECOM PRIVATE LIMITED S 70000 39.88
4/6/2010 531373 Suave Hotels LATIF UMMED ALI KHAN S 85000 35.32
4/6/2010 530477 Vikram Thermo SAMIR NARENDRA GUPTA B 19529 21.30
4/6/2010 530477 Vikram Thermo ACTION FINANCIAL SERVICES (INDIA) LIMITED S 21604 21.18
4/6/2010 522080 Vulcan Engr SUVIR MALANEY TRUST S 29029 33.59
4/6/2010 506720 Zandu Rlty OPG SECURITIES P LTD B 6417 3238.19
4/6/2010 506720 Zandu Rlty OPG SECURITIES P LTD S 6417 3242.95
* B - Buy, S - Sell

NSE Bulk Deals to Watch - June 4 2010

Date,Symbol,Security Name,Client Name,Buy/Sell,Quantity Traded,Trade Price / Wght. Avg. Price,Remarks
04-JUN-2010,ANGAUTO,ANG Auto Limited,SAR AUTO PRODUCTS LIMITED,BUY,151224,54.65,-

Bulls’ momentum sustains on third straight day

Today's major news

Cadila launches H1N1 vaccine; the stock ends 2.35% higher

Aqua Logistics completes acquisition of 3 cos; the stock ends 0.97% up

Varun Industries signs MoU with Karnataka Govt; the stock closes 0.80% lower

Global signals

European stocks edge higher on Friday, extending a week-long recovery rally, as investors eagerly awaited US monthly jobs data that could ease recent jitters over the pace of the global recovery. As of writing this report, FTSE 100 was trading at 0.50% higher.

All the major Asian indices closed in the positive territory except Hong Kong’s Hang Seng and Japan’s Nikkei indices that closed marginally lower. SGX Nifty closed 24 points higher.

The US stock index futures signal higher opening on the Wall Street on Friday. Investors await for the non-farm payrolls data and unemployment rate for the month of May 2010 that will be announced later today, which could provide an indication of the pace of recovery in the world's largest economy.

Indian indices

The domestic market continued its upward momentum for the third session in a row. It moved higher in seven of the eight previous trading sessions. The indices had a quite start due to lack of Asian and US cues. The market traded in a narrow range and continued its listless session till the afternoon trade. Due to lack of support from global markets, Indian bourses could not take a proper decision. However, in afternoon session, the domestic market got some positive signs after a strong opening in European equities. The Indian markets accumulated its gains and got strengthened, which led the market to end the day on a higher note.

Tracking the muted global cues, the Sensex opened 14 points higher at 17036. The Sensex soon turned negative and breached its 17000 mark to hit the day’s low of 16964. The Sensex hovered between negative and positive terrain through out the morning session. In afternoon session, strong opening in European markets and buying in fast moving consumer goods (FMCG), telecom and information technology stocks pushed the Sensex to its day’s high of 17150. However, at the end, it pared some of its gains and finished the session above 17000 mark, 95 points higher at 17118. The Nifty signed off at 5135, 25 points higher.

Market sentiment

The market breadth was neutral. Of the 2,939 stocks traded on the BSE, 1,400 stocks advanced, whereas 1,415 stocks declined. Hundred and twenty four stocks remained unchanged.

Sectoral & stock screening

Of the 13 sectoral indices in BSE - seven of the sectors ended in green, while six closed the day in red. The sectors that surged the most - BSE FMCG gained 1.69%, followed by the BSE TECk that advanced by 1.02% and rest of the gaining sectors rose in the range of 0.13% to 0.93%. The losing sectors were - BSE Metal lost 0.24% and BSE Power declined 0.19%.

Among 'A' group stocks, Welspun Corp was the star stock of the day posting gains of 5.25%, followed by Essar Oil that surged by 4.41% and Syndicate Bank that rose by 4.29%. Among losers, Sesa Goa slid the most by 3.30%, followed by Marico that fell by 3.24% and Gujarat NRE Coke that shed 2.72%.

Viewing volumes

India's second largest listed cellular services provider by sales - Reliance Communications witnessed highest trading with over 0.64 crore shares changing hands on the BSE, followed by wind turbine major - Suzlon Energy (0.50 crore shares), Anil Dhirubhai Ambani Group firm - Reliance Natural Resources (0.44 crore shares), industrial finance company - IFCI (0.41 crore shares) and India’s second largest developers - Unitech (0.35 crore share).