Directors Report of CDI International Ltd.

Mar 31, 2014

Dear Shareholders,

The directors have pleasure in presenting the 22nd Annual Report and Audited Financial Statements of your Company for the financial year ended 31st March 2014.

FINANCIAL HIGHLIGHTS (Rupees in lacs)

Particulars Year ended Year ended March 31, 2014 March 31, 2013

Total Income - -

Total expenditure 54.19 35.56

Profit/ Loss before tax (54.19) (35.56)

OPERATIONAL PERFORMANCE AND FUTURE OUTLOOK

The Indian Media and Entertainment (M&E) Industry, one of the most vibrant and exciting industries in the world, has had a tremendous impact on the lives and the Indian economy. With the addition of new media such as animation, online gaming and applications running on mobile devices, a new dimension has been added to the world of media that was dominated by traditional media. In addition to their implicit impact, all media platforms provide a great opportunity to carry explicit messages to create social impact.

India continues to remain an important outsourcing destination offering significant cost arbitrage to countries in North America and Europe. Moreover, growing presence of India studios in international markets has enabled them to capitalize on synergy across various offices, locations, talent and projects.

DIRECTORS

Pursuant to Section 149 of the Companies Act, 2013, the Board at its meeting held on 14th August, 2014, recommended appointment of Ms. Santosh Grover and Mr. Pant Raj Sachdev as Independent Directors of the company, not liable to retire by rotation for a period of five years from the date of its 22nd annual general meeting Subject to approval of the members of the company. These Directors have given the declarations to the board that they meet the criteria of independence as provided under Section 149(6) of the said act and also confirmed that they will abide by the provisions as mentioned in schedule IV of the companies'' act 2013.The Board recommends the resolutions for your approval of the above appointments

Ms. Rashmee Seengal, Director, retire by rotation and being eligible, has offered herself for re-appointment. The Board same recommends the same for your approval.

PARTICULAR OF LOANS, GUARANTEES OR INVESTMENTS

The company has not made any investments in the Financial Year 2013-2014.

CORPORATE GOVERNANCE

Your Directors reaffirm their continued commitment to good corporate governance practices. Your Company fully adheres to the standards set out by the Securities and Exchange Board of India for Corporate Governance practices, and has implemented all of its stipulations.

As required by Clause 49 of the Listing Agreement of Stock Exchange, a separate section on Corporate Governance together with a certificate from Company''s Statutory Auditors, forms part of this Annual Report.

GREEN INITIATIVE IN CORPORATE GOVERNANCE

As a part of the Green Initiative in Corporate Governance, The Ministry of Corporate affairs (MCA), Government of India, through its Circular nos.17/2011 and 18/2011, dated April 21, 2011and April 29, 2011 respectively, has allowed companies to send official Notices/documents to their shareholders electronically.

As a responsible Corporate Citizen, your Company has actively supported the implementation of Green Initiative and effected electronic delivery of Notice of annual General Meeting (AGM) to those shareholders whose email IDs were already registered with the Depository Participants.

Shareholders are requested to support the "THINK GREEN, GO GREEN" initiative of your company by registering/ updating e-mail addresses for receiving electronic communications.

FIXED DEPOSITS

The Company has not accepted any public deposits and as such, no amount on account of principal or interest on public deposits was outstanding as on the date of the balance sheet.

DIVIDEND

In view of the losses incurred by the Company during the year under review, your directors do not recommend any dividend for the year 2013- 14

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

A Management Discussion and Analysis Report for the year under review, as stipulated under clause 49 of the Listing Agreement with stock exchanges in India, is presented in a separate section forming part of the Annual Report.

SHARE CAPITAL

Increased in Authorized Capital

During the Financial Year 2013-14, Company has an Authorized Capital of Rs. 150000000/- divided into 15000000 no. of equity shares of Rs.10/-.

LISTING WITH STOCK EXCHANGES

The Equity Shares of the Company are listed on Bombay Stock Exchange and Ludhiana Stock Exchange. The annual listing fees for the year 2014-15 have been paid to these Stock Exchanges.

STATUTORY AUDITORS

M/s. Sinha Gupta & Associates, Chartered Accountants has been appointed as Statutory Auditors in the meeting of the Board of Directors to inter alia conduct Audit for the financial Year 2013-14 on ad- hoc basis subject to approval of shareholders in the ensuing Annual General Meeting as M/s. Gaur Jain & Co., Chartered Accountants could not hold the office due to some unavoidable circumstances. Being eligible for appointment, M/s. Sinha Gupta & Associates, Chartered Accountants, have expressed their willingness to be appointed as Statutory Auditors of the Company. They have given certificate to the effect that the appointment, if made, would be within the limit prescribed under section 139 of the Companies Act, 2013. Your directors recommend their appointment for four years. Accordingly the Statutory Auditors have audited the Annual Financial Statements of the Company for the Financial Year ended 31st March, 2014.

SECRETARIAL AUDITORS

In Pursuance of provisions of Section 204 of the Companies Act, 2013, Mr. Sanjeev Sharma, Company Secretary in practice, has been appointed as Secretarial Auditor by the Board of your Company for carrying out Secretarial Audit for the Financial Year 2014-15.

INTERNAL AUDITORS

In pursuance of provisions of section 138 of Companies Act, 2013 read with Companies (Account) Rules 2014, Mr. Manish Mehndroo has been appointed as Internal Auditor of your Company for carrying out Internal Audit for the Financial Year 2014-15.

STATUTORY AND OTHER INFORMATION REQUIREMENTS

Information required to be furnished as per the Companies Act, Listing Agreement with Stock exchanges, Management Discussion & Analysis Report, Report on Corporate Governance, Auditor''s Certificate on Corporate Governance forms the part of this Annual Report.

DIRECTORS'' RESPONSIBILITY STATEMENT

With reference to Section 217(2AA) of the Companies Act, 1956, your Directors confirm that:-

(i) in the preparation of the Annual Accounts for the financial Year 2013-14, the applicable accounting standards have been followed along with proper explanations relating to material departures, wherever applicable;

(ii) such accounting policies have been selected and applied consistently and judgments and estimates made 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;

(ii) proper and sufficient care is taken for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; and

(iii) The Annual accounts have been prepared on a ''going concern'' basis.

CONSERVATION OF ENERGY AND TECHNOLOGY ABSORPTION

In view of the nature of activities which are being carried on by the Company, the particulars as prescribed under Section 217(1)(e) of the Companies Act, 1956 read with Companies'' (Disclosures of Particulars in the Report of the Board of Directors) Rules, 1988 regarding Conservation of Energy and Technology Absorption are not applicable to the Company.

FOREIGN EXCHANGE EARNINGS AND OUTGO

During the year under review, the Company has neither earned nor used any foreign exchange. PARTICULARS OF EMPLOYEES UNDER SECTION 217(2A) OF THE COMPANIES ACT, 1956

There is no employee in the company whose particulars are required to be given under section 217 (2A) of the Companies Act, 1956.

VIGILANCE MECHANISM

Vigilance Mechanism lays its emphasis on ''Preventive Vigilance'' so as to enhance transparency and accountability on systems and procedures.

INVESTOR RELATIONS

Your Company always endeavors to keep the timely response to shareholder''s request/grievances at a minimum. Priority is accorded to address all the issues raised by the shareholders and provide them satisfactory reply at the earliest possible time. The Stakeholder Relationship Committee (earlier Shareholder''s and Investor Grievances committee) of Board meets periodically and reviews the status of redresses of investor''s grievances.

ACKNOWLEDGEMENT

Your Directors would like to express their sincere appreciation for the co-operation and assistance received from the stakeholders and business associates who have extended their valuable sustained support and encouragement during the year under review.

Your Directors take this opportunity to recognize and place on record their gratitude and appreciation for the commitment displayed by staff at all levels of the Company. We look forward for your continued support in the future.

By the order of the board For CDI International limited

Sd/- Mr. Suresh Kumar Place : Chandigarh (Managing Director) Date : 21.08.2014 DIN: 00507208

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Mar 31, 2011

Dear Members,

The directors take pleasure in presenting the Annual Report and the Audited Accounts of the company for the year ended March 31, 2011.

FINANCIAL RESULTS

(Rs. in lac)

Year Ended Year Ended March 31, 2011 March 31, 2010

Total Sales/Income 26924.34 22817.60

Total Expenditure 21822.06 17991.10

Profit before Depreciation 5102.28 4826.50

Depreciation 23.30 18.39

Interest 16.55 00.81

Profit before Taxation 5062.43 4807.30

Provision for Taxation - 74.57

Deferred Tax (4.73) 1.03

Profit available for appropriations 5057.70 4733.76 Appropriations:

Provision for Bad & Doubtful Debts - 1809.24

Proposed Dividend - 191.41

Tax (including cess) on Dividend - 32.53

Transfer to General Reserve 505.77 473.38

Balance carried to Balance Sheet 4551.93 2227.20

FINANCIAL PERFORMANCE

Your company achieved a turnover of Rs. 26924.34 lac against Rs. 22817.60 lac during the previous year showing an increase of 18%. The profit after tax (PAT) of CDI grew by 6.84% to Rs. 5057.70 lac over fiscal 2009-10. The profit before tax (PBT) increased by 5.30% to Rs.5062.43 lac. The company recorded earnings per share (EPS) Rs.53 as compared to Rs. 49 last year, higher by 8.16% (annualized).

OPERATIONS AND FUTURE PROSPECTS

CDI is the largest animation company of South Asia and 2nd largest in Asia. The company was awarded by Forbes Asia as the best performing mid sized company of Asia-Pacific region and ranked at overall position of 28 in terms of business performance in India by Inc. Magazine alongwith several performance records/ awards by Economic Times, Business Standard etc. The next few years are likely be characterized by uncertainty and volatility as the effects of the global slowdown have started becoming apparent. The Board has decided to consolidate its all existing operations at one single place, explore new business avenues in Japan, China and other Asian & Middle-East countries. The Board has also decided to diversify into education, healthcare and infrastructure sectors.

DIRECTORS

Mrs. Rashmee Seengal, director of the company retires by rotation and being eligible offers herself for re-appointment.

CORPORATE GOVERNANCE

The company has complied with the mandatory provisions of the corporate Governance as prescribed in the Listing Agreement with the stock exchanges. A separate report on corporate governance is included as a per of the Directors Report with the Auditors Certificate on its compliance.

AUDITORS

Suresh Goyal & Associates, Chartered Accountants, Chandigarh, Statutory Auditors of the company, retire at the conclusion of the ensuing Annual General Meeting and being eligible offer themselves for re-appointment as Statutory Auditors of the company.

SUBSIDIARY COMPANY

In accordance with the general circular issued by the Ministry of Corporate Affairs, Government of India, the Balance Sheet, Profit and Loss Account and other documents of the subsidiary companies are not being attached with the balance sheet of the company. The company will make available the annual accounts of the subsidiary companies and the related detailed information to any member of the company who may be interested in obtaining the same. The annual accounts of the subsidiary companies will be kept open for inspection at the Registered Office of the company and that of the respective subsidiary companies. The consolidated financial statements presented by the company include the financial results of its subsidiary companies.

CONSOLIDATED FINANCIAL STATEMENT

In accordance with the Accounting standard AS-21 on consolidated financial statements read with Accounting standard AS-23 on accounting for investment in associates, the audited consolidated financial statements are provided in Annual Report.

DIRECTORS' RESPONSIBLITIY STATEMENT

Pursuant to the requirement under section 217(2AA) of the companies Act, 1956 with respect to Directors Responsibility statement, it is hereby confirmed:

a) that in preparation of the annual accounts for the financial year ended March 31, 2011, the applicable accounting standards had been followed.

b) that the directors had selected such accounting policies and applied them consistently and made judgments and estimates that were 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 or loss of the company for the year under review.

c) that the directors had 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. d) that the directors had prepared the accounts for the financial year ended March 31, 2011 on a going concern basis.

NEW INITIATIVE

The Board had decided to consolidate its all existing operations at one single place, explore new business avenues in japan, China and other Asian & Middle- East countries. The board has also decided to diversity into education, healthcare and infrastructure sectors.

CORPORATE SOCIAL RESPONSIBILITY REPORT

Compact Disc India Ltd. embraces its responsibility for society and community at large. GDI has donated 2 nos. fully equipped Ambulances to Kanta Seengal Memorial Charitable Trust to start Ambulance Services. It offers ambulance services to the needy people at nominal charges within "0 Kms radius of Chandigarh city.

FIXED DEPOSITS

The company has not raised any fixed deposits during the year.

PARTICULARS REGARDING ENERGY CONSERVATION, TECHNOLOGY ABSORPTION ETC.

Since the company is not a major energy-consuming unit, particulars regarding conservation of energy etc. as prescribed under section 217(1) (e) of the Companies Act, 1956 are not applicable to the company. As the company has not absorbed any technology, research and development etc, the particulars regarding technology absorption, innovation and research & development are not applicable.

PARTICULARS OF EMPLOYEES

There was no employee during the year whose particulars are required to be given under section 217(2A) of the Companies Act, 1956 read with the Companies {Particulars of Employees) Rules 1975.

PERSONNEL AND INDUSTRIAL RELATIONS

The management and employees relations remained cordial throughout the year under report.

MANAGEMENT DISCUSSIONS AND ANALYSIS REPORT

Management Discussion and Analysis Report for the year under review, as stipulated under clause 49 of Listing Agreement with Stock Exchange in India, is presented in a separate section forming part of the Annual Report.

ACKNOWLEDGEMENT

Your directors wish to place on record their appreciation for the continued support, encouragement and co-operation extended by State and Central Government Agencies, Company's Bankers, Business Associates, Esteemed Customers and Shareholders. Your directors also record their appreciation for the dedicated services rendered by all ranks of the company's personnel.

For and on behalf of the Board of Directors

Sd/- Place: Chandigarh (Suresh Kumar)

Date : August 31, 2011 Chairman and Managing Director

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Mar 31, 2010

The directors take pleasure in presenting the Annual Report and the Audited Accounts of the company for the period ended 31st March, 2010.

FINANCIAL RESULTS

( Rs. in lac) Year Ended Year Ended 31st March, 2010 31st March, 2009

Total Sales/Income 22817.60 19210.15

Total Expenditure 17991.10 14748.49

Profit before Depreciation 4826.50 4461.66

Depreciation 18.39 15.45

Interest 00.81 65.26

Profit before Taxation 4807.30 4380.95

Provision for Taxation 74.57 432.41

Deferred Tax 1.03 1.12

Profit available for appropriations 4733.76 3949.66

Appropriations :

Provision for Bad & Doubtful Debts 1809.24 -

Proposed dividend 191.41 191.41

Tax (including cess) on dividend 32.53 32.53

Transfer to General Reserve 473.38 438.09

Balance carried to Balance Sheet 2227.20 3287.63



FINANCIAL PERFORMANCE

Your company achieved a turnover of Rs. 228.17 crore against Rs. 192.10 crore during the previous year showing an increase of 18.78%. The profit after tax (PAT) of CDI grew by 19.82% to Rs. 47.33 crore over fiscal 2008-09. The profit before tax (PBT) increased by 9.73% to Rs. 48.07 crore. The company recorded earnings per share (EPS) Rs. 49.45 as compared to Rs. 41.27 last year, higher by 19.82% (annualized).

DIVIDEND

Your directors are pleased to recommend dividend @ Rs.2/- per share for the year ended 31st March, 2010. This, if approved at the annual general meeting will absorb an amount of Rs.191.41 lac.

OPERATIONS AND FUTURE PROSPECTS

Compact Disc India Limited (CDI) is an existing profit making company engaged in multimedia and entertainment production in India. Presently CDI is India’s leading integrated media and entetainment company with prime focus on Animation Outsourcing and Production. With a phenomenal growth of over 345% in just 5 years, CDI is fast emerging as Asia’s undisputed leader in the animation film industry.

The company is anticipating significant growth in its business and with the growing business it needs to set-up Pre-Visualization Studios at Los Angeles, London and Singapore. All existing business from affiliates will be consolidated in Chandigarh by the end of this year. CDI will also be holding company for all overseas subsidiaries. These subsidiaries will be serviced by establishing marketing offices in Sao Paulo, Tokyo and Johannesburg.

The company has engaged Grant Thornton to assist in preparing a Business Plan.

The company has also decided to set-up five world class state-of-the-art Animation & Gaming Centres of Excellence at par with IITs, which would be the first of their kind in India. The first such centre at Chandigarh is already in process of commencing Animation & Gaming courses for engineering students to impart highest level of quality education from the session 2011-12.

Grant Thornton has also been engaged to prepare the Business Plan for the education venture.

DIRECTORS

Mrs. Santosh Grover, Director of the company retires by rotation at the end of this Annual General Meeting and being eligible offers herself for re-appointment. Mrs. Rashmee Seengal has resigned from the post of whole time director, however she will remain as director on the Board. The Board of Directors has appointed Mr. Kanad Kshayap and Mr. Anil Kumar as additional directors of the company w.e.f. 15.05.2010, who will cease to be directors at the conclusion of this Annual General Meeting pursuant to the provisions of Section 260 of the Companies Act, 1956. Mr Kanad Kashyap is not interested in reappointment. Company has received notice from a member of the company u/s 257 alongwith requisite deposit proposing the name of Mr. Anil Kumar for appointment as director. Board recommend his appointment.

PREFERENTIAL ALLOTMENT

The company has issued 14,00,000 Convertible Warrants of Rs. 10/- each at a price of Rs. 100/- per warrant on 18.12.2008, on preferential basis. Each warrant was convertible into one equity share of Rs. 10/- each to be issued on a premium of Rs. 90/- per share, within 18 months from the date of allotment at the option of the allottee. The allottee has not opted for conversion of warrants into equity shares of the company within 18 months from the date of allotment and has not deposited the balance amount. As such the application money of Rs. 1,40,00,000/- received from the allottee is forfeited pursuant to the provisions of Securities & Exchange Board of India (Disclosure and Investors Protection) Guidelines 2000 and in terms of allotment of warrants.

CORPORATE GOVERNANCE

The company has complied with the mandatory provisions of the Corporate Governance as prscribed in the Listing Agreement with the Stock Exchanges. A separate report on Corporate Governance is included as a part of the Directors Report with the Auditors Certificate on its compliance.

AUDITORS

Suresh Goyal & Associates, Chartered Accountants, Chandigarh, Statutory Auditors of the company, retire at the conclusion of the ensuing Annual General Meeting and being eligible offer themselves for re-appointment as statutory auditors of the company.

SUBSIDIARY COMPANY

The statement of the holding companys interest in Seengal Animation Pvt. Ltd., the subsidiary company is attached to the report and accounts of the company.

CONSOLIDATED FINANCIAL STATEMENT

The duly audited financial statements as required under the Accounting Standard 21 and 27 and provisions of clause 32 of Listing Agreement have been prepared after considering the audited financial statement of your companys subsidiary and appear in the Annual Report of company for the year 2009-10.

DIRECTORS’ RESPONSIBILITY STATEMENT

Pursuant to the requirement under section 217(2AA) of the Companies Act, 1956 with respect to Directors’ Responsibility Statement, it is hereby confirmed:

a) That in preparation of the annual accounts for the financial year ended 31st March, 2010, the applicable accounting standards had been followed.

b) That the directors had selected such accounting policies and applied them consistently and made judgments and estimates that were 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 or loss of the company for the year under review.

c) That the directors had 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.

d) That the directors had prepared the accounts for the financial year ended 31st March, 2010 on a ‘going concern’ basis.

FIXED DEPOSITS

The company has not raised any fixed deposits during the year.

PARTICULARS REGARDING ENERGY CONSERVATION, TECHNOLOGY ABSORPTION ETC.

Since the company is not a major energy-consuming unit, particulars regarding conservation of energy etc. as prescribed under section 217(1) (e) of the Companies Act, 1956 are not applicable to the company. As the company has not absorbed any technology, research and development etc, the particulars regarding technology absorption, innovation and research & development are not applicable.

PARTICULARS OF EMPLOYEES

Statement of employees whose particulars are required to be given under section 217(2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules 1975, is annexed.

RELATED PARTY TRANSACTIONS

A statement of related party transactions pursuant to Accounting Standards 18 form a part of this Annual Report.

PERSONNEL AND INDUSTRIAL RELATIONS

The management and employees relations remained cordial throughout the year under report.

ACKNOWLEDGEMENT

Your directors wish to place on record their appreciation for the continued support,encouragement and co-operation extended by State and Central Government Agencies, Companys Bankers, Business Associates, Esteemed Customers and Shareholders.

Your directors also record their appreciation for the dedicated services rendered by all ranks of the companys personnel.

For and on behalf of the Board of Directors Sd/- Place : Chandigarh (SURESH KUMAR) Date : July 26, 2010 Chairman and Managing Director