DIRECTORS' REPORT

Dear Shareholders,

We are pleased to present the Twenty Fifth Annual Report of Jain Studios Limited together with Audited Financial Statements and Auditor's Report for the Financial Year ended as on 31st March 2015

Performance

During the year under review, the total income of your Company was Rs. 2321.89 Lakh as compared to Rs. 2517.83 Lakh in the previous F.Y. 2013-14 registering a decrease of 7.78%. The loss before Tax for the year under review was Rs. 47.17 Lakh as compared to Profit before Tax of Rs. 106.46 Lakh in the previous year. The Net Loss for the year under review was Rs. 189.88 Lakh as compared to Net Profit of Rs. 50.80 Lakh in the previous year.

Dividend

In view of the brought forward losses and lack of adequate profits in the current year, your Directors have been unable to recommend any dividend.

Business Operations Overview & Future Outlook

The principal business activities of the Company are broadly categorized into following areas:

1. Television (Marketing, Production & Broadcasting)

2. Education Infrastructure & Technology

3. Teleport

4. Others including Production and Distribution of Cinema Photographic Film (s) and Mobile Healthcare.

During the year, major revenues generated by the Company from 'Mobile Healthcare' in different state of India and from 'Education Infrastructure & Technology'. We are hopeful for continuous increase in revenues of the Company taking into consideration state-wise requirement of operation of mobile healthcare projects in India and expansion of 'Education Infrastructure & Technology' business.

Company is concentrating in its existing "JAIN Satellite Television" and Broadcasting business, through a reputed & experienced distribution platform, which will hopefully contribute in enhancing the revenues of the Company.

Further, Company is in discussions with different parties to generate the revenues through other revenue streams apart from its existing business. Shortly, it will come up with additional revenue streams.

The Company is also in talks with various consultants and possible partners regarding re-structuring of its various business activities and to find ways to recognize its investments to achieve better shareholders' value.

Fixed Deposits

The Company has not accepted any deposits during the financial year under review.

Directors' Responsibility Statement

Pursuant to Section 134 of the Companies Act, 2013 ('the Act'), in relation to the Audited Financial Statements for the Financial Year 2014-15, your Directors hereby confirm that:

a) The Financial Statements of the Company comprising of the Balance Sheet as at March 31, 2015 and the Statement of Profit & Loss for the year ended on that date, have been prepared on a going concern basis following applicable Accounting Standards and that no material departures have been made from the same;

b) Accounting policies selected were applied consistently and the judgements and estimates related to the financial statements have been made on a prudent and reasonable basis, so as to give a true and fair view of the state of affairs of the Company as at March 31, 2015 and of the profit of the Company for the year ended on that date;

c) Proper and sufficient care has been taken for maintenance of adequate accounting records in accordance with the provisions of the Act, to safeguard the assets of the Company and for preventing and detecting fraud and other irregularities;

d) Requisite internal financial controls were laid down and that such financial controls are adequate and operating effectively; and

e) Proper systems have been devised to ensure compliance with the provisions of all applicable laws and such systems are adequate and operating effectively.

Conservation of Energy, Technology Absorption and Foreign Exchange Earnings Outgo

Information Pursuant to Section 134 (3)(m) of the Companies Act, 2013 read with Companies (Accounts) Rules, 2014:

A. Energy conservation - The Company makes continuous efforts to explore new technologies and techniques to make the infrastructure more energy efficient. Moreover, the operations of the Company are not energy intensive.

B. Technology absorption - Company uses Indian technical manpower to operate Indian and imported infrastructure.

C. Foreign Exchange earnings and out go:

Earnings in foreign exchange : NIL

Expenditure in foreign exchange : NIL

Personnel and Particulars of Employees

The industrial relations with the workers and staff of the Company remained cordial throughout the year. There was unity of purpose among all levels of employees, continuously striving for improvement in work practices and productivity. Training and development of employees continue to be an area of prime importance. Requisite disclosures in terms of Section 197 of the Companies Act, 2013, read with Rule 5 of the Companies

(Appointment and Remuneration of Managerial Personnel) Rules, 2014, as amended, are given to the extent applicable and Particulars of employees are not given as none of the employees qualify for such disclosure.

Directors and Key Managerial Personnel

Your Board comprises of 4 Directors including 2 Independent Directors. Independent Directors provide their declarations both at the time of appointment and annually confirming that they meet the criteria of independence as prescribed under Companies Act, 2013 and Clause 49 of the Listing Agreement. During F.Y.2014- 2015 your Board met 5 (five) times, details of which are available in Corporate Governance Report annexed to this report.

Dr.(Mrs.) Ragini Jain, Non-Executive Director is liable to retire by rotation at the ensuing Annual General Meeting and, being eligible offered herself for re-appointment. Your Board recommends her re-appointment.

In compliance with the requirements of Section 203 of the Companies Act, 2013, Dr. J. K. Jain, Chairman & Managing Director, Mr. Sunil Kumar Malhotra, Chief Finance Officer and Mr. Satyendu Pattnaik, Chief Compliance Officer & Company Secretary of the Company were nominated as Key Managerial personnel.

Board Evaluation

In a separate meeting of Independent Directors, performance of non-independent directors, performance of the Board as a whole and performance of the Chairman was evaluated. Based on such report of the meeting of Independent Directors and taking into account the views of executive directors and non-executive directors the Board had evaluated its performance on various parameters such as Board composition and structure, effectiveness of board processes, effectiveness of flow of information, contributions from each Directors etc.

Terms of Appointment of Dr. J.K. Jain

Dr. J.K. Jain was appointed as Managing Director of the Company for a period of five years w.e.f. 01.10.1999. Thereafter, he re-appointed as Managing Director of the Company by the Board of Directors at their meeting held on 26th August 2004 for a period of five years w.e.f. 01.10.2004 with the approval of members of the Company and of the Central Government. Remuneration of Dr. J.K. Jain, Chairman & Managing Director of the Company was revised @ Rs. 5.00 Lac per month w.e.f. 01.04.2007 with the approval of the members of the Company and of the Central Government. Further, he re-appointed as Chairman & Managing Director of the Company at the remuneration of Rs.5.00 Lac per month for a period of three years w.e.f. 01.10.2009 with the approval of shareholders of the Company and Central Government. Thereafter, he re-appointed as Chairman & Managing Director of the Company at nil remuneration for a period of three years w.e.f. 01.10.2012 with the approval of members of the Company at their AGM held on 29.09.2012.

Nature of appointment of Dr. J.K. Jain, Chairman & Managing Director: Contractual

No. of equity shares of Jain Studios Ltd. held by Dr. J.K. Jain as on 31.03.2015 are 62,50,100, which constitutes 21.86% of the paid up share capital of the Company.

Auditors

Statutory Audit: The Statutory Auditors M/s N.P. Bansal & Co., Chartered Accountants, New Delhi, having Firm Registration No. 877N, holds office until the conclusion of the ensuing Annual General Meeting and is eligible for reappointment. Your Company has received confirmation from the Auditors to the effect that their appointment, if made, will be in accordance with the limits specified under the Companies Act, 2013 and the firm satisfies the criteria specified in Section 141 of the Companies Act, 2013 read with Rule 4 of Companies (Audit & Auditors) Rules 2014. Your Board is of the opinion that continuation of M/s N.P. Bansal & Co., as Statutory Auditors during FY 2015-16 will be in the best interests of the Company and therefore, Members are requested to consider their re-appointment as Statutory Auditors of the Company from the conclusion of ensuing Annual General Meeting till next Annual General Meeting at remuneration be decided by the Board.

Secretarial Audit: During the year, Secretarial Audit was carried out by Mr. Ajay Behera, Practicing Company Secretary in compliance with Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.

The report of Statutory Auditor and/or Secretarial Auditor forming part of this Annual report having any qualification, reservation or adverse remarks are self-explanatory and do not call for further explanation.

Disclosures

I. Particulars of loans, guarantees and investments:

Particulars of loans, guarantees and investments made by the Company required under section 186 (4) of the Companies Act, 2013 are contained in Note No. 2.9 and 2.27 to the Financial Statements.

ii. Transactions with Related Parties: None of the transactions with related parties fall under the scope of Section 188(1) of the Act. Information on material transactions with related parties pursuant to Section 134(3)(h) of the Act, read with rule 8(2) of the Companies (Accounts) Rules, 2014, in form AOC-2 is annexed to this report.

iii. Deposits: Your Company has not accepted any public deposit under Chapter V of the Companies Act, 2013.

iv. Extract of Annual Return: The extract of Annual Return in Form MGT-9 as required under Section 92(3) of the Act read with Companies (Management & Administration) Rules, 2014 is annexed to this report.

v. Sexual Harassment: The Company has zero tolerance for sexual harassment at workplace and has adopted a Policy on prevention, prohibition and redressal of sexual  harassment at workplace in line with the provisions of the Sexual Harassment of Women at workplace (Prevention, Prohibition and Redressal) Act, 2013 and the Rules there under. During the year under review there is no complaint has been received on sexual harassment.

vi. Regulatory Orders: No significant or material orders were passed by the regulators or courts or tribunals which impact the going concern status and Company's operations in future.

Auditors' Report

Auditors' observations are suitably explained in notes to the Accounts and are self- explanatory and therefore do not call for any further explanation.

Audit Committee recommendations

The Audit Committee has recommended for deposit of all statutory dues, such as, Provident Fund, Employees State Insurance, Service Tax, Sales Tax/VAT, Custom Duty, Cess, TDS and any other material statutory dues before due date and file the necessary returns to the concerned department before due date to avoid unnecessary interest, penalties and prosecutions.

One Time Settlement (OTS) with SASF and Issue of Equity Shares

With reference to OTS arrived with Stressed Assets Stabilization Fund (SASF) by the Company, agreed OTS amount of Rs. 11.00 Crore in cash has been paid by the Company to SASF without any outstanding and 50,00,000 equity shares of Rs.10/- each fully paid up at par of the Company amounting to Rs. 5.00 Crore has been allotted to SASF on 23.04.2012 with the condition of buy-back of these shares by promoters/Representatives.

Issue of Equity shares and Warrants to the Promoters of the Company

60,50,000 equity shares of Rs. 10/- each fully paid up of the Company at a premium of Rs. 2.50/- each per share and 51,50,000 Warrants convertible into equivalent number of equity shares of Rs.10/- each at premium of Rs.2.50/- each per share issued and allotted to the Promoter of the Company on 23.04.2012 against the consideration of full application money and 25% warrant money. Thereafter, Company allotted 31,58,700 equity shares of Rs. 10/- each fully paid up at a premium of Rs.2.50/- per share to the Promoter(s) of the Company on 17.10.2013 by converting 31,58,700 Warrants out of 51,50,000 allotted Warrants on receiving balance warrant money. Total consideration from issue of equity shares and warrants as mentioned above was utilized by the Company to clear the agreed OTS amount of Rs.11.00 Crore in cash to SASF and some outstanding statutory dues of the Company

Listing of Equity Shares

Listing Application alongwith necessary documents and certificates filed with BSE and NSE for listing of 60,50,000 equity shares of Rs. 10/- each fully paid up of the Company at a premium of Rs. 2.50/- each per share allotted to the Promoter of the Company and 50,00,000 equity shares of Rs.10/- each fully paid up at par of the Company allotted to Stressed Assets Stabilization Fund (SASF) respectively. With reference to our said listing application, BSE vide their letter dated 30.07.2012 has given the listing approval. But trading permission will be granted by BSE subject to obtaining of listing approval from NSE and some other formalities with NSDL & CDSL. Listing approval from NSE is awaited.

Further, on allotment of 31,58,700 equity shares on 17.10.2013, listing application had been filed with BSE & NSE along-with other certificates and documents. Follow up is going on for listing of these shares at BSE & NSE.

Pending Status of Preferential Issues & Reduction of Share Capital

Company had allotted 38,00,000 and 15,00,000 equity shares on 25.08.2005 and on 25.02.2006 respectively to the Indian Promoter Group Companies against the conversion of 53,00,000 share warrants allotted on 26.08.2004. Thereafter, Company got the in-principle approval from BSE for listing of said shares vide their letter dated 26.05.2008 with the condition of in-principle approval from NSE also. However, NSE did not grant any listing and trading permission of said 53,00,000 shares allotted by the Company on preferential basis due to certain lapses of erstwhile SEBI (DIP) Guidelines.

Non listing of the said 53,00,000 Equity Shares led to a mismatch between the "Issued Equity Share Capital" & "Listed Equity Share Capital" of the Company.

It may be noted that the "Issued Equity Share Capital" has to be in line with the "Listed Equity Share Capital", as per the Stock Exchanges.

Hence it was proposed by the Board for reduction of the unlisted 53,00,000 Equity Shares of Rs. 10/- each, issued at a premium of Rs.9/- each, by paying off/ returning the entire paid up share capital on the unlisted 53,00,000 (Fifty Three Lac) Equity Shares of Rs. 10/- each fully paid up, to those allottees, who had subscribed to the said preferential allotment of 53,00,000 equity shares made by the Company and thereby extinguishing all those shares. Further, apart from above, it was proposed to issue upto 4,77,000 (Four Lac Seventy Seven Thousand) Redeemable Preference Shares of Rs.100/- each fully paid up at par in one or more trenches to these allottees against and in proportion to the share premium amount received by the Company @ Rs.9/-each per share (53,00,000 equity shares) from these allottees. The said resolutions were approved by the shareholders of the Company at their AGM held on 30th September 2011.

Company received NOC from NSE and BSE vide their letter dated 06.03.2012 and 04.04.2012 respectively and part  creditor(s) of the Company for filing of Scheme of Arrangement relating to Re-Organisation and Reduction of share capital with the Hon'ble High Court of Delhi pursuant to Section 391 and other applicable provisions of the Companies Act, 1956. However, pursuant to SEBI circular dated 04.02.2013, Company was required again, to obtain the NOC from BSE and N SE alongwith the observation/approval of SEBI, as the Company did not able to file the said scheme with the Hon'ble High Court of Delhi before 04.02.2103 due to some technical and procedural formalities including non-issue of NOC by SASF.

Therefore, Company once again filed the draft copy of said scheme alongwith other certificates and documents with BSE and NSE for their NOC with the observation and approval of SEBI. However, after review and observation of SEBI, again Scheme of Reduction shall be modified and shall be filed with BSE & NSE for their NOC subject to observation and approval of SEBI before filing the same with the Hon'ble High Court of Delhi.

Listing with Stock Exchanges

The Company confirms that it has paid the Annual Listing Fees for the year 2014-15 to NSE and BSE where the Company's shares are listed.

Dematerialization of Shares

16.79% of the Company's paid up equity share capital is in dematerialized form as on 31.03.2015.  The Registrars of the Company is Beetal Computer & Financial Services Pvt. Ltd. Beetal, House, 3rd Floor, 99, Madangir, BH - Local Shopping Centre, Near Dada Harsukhdas Mandir, New Delhi - 110 062.

Corporate Governance & Policies

We strive to attain high standards of corporate governance while interacting with all our stakeholders. The Company has duly complied with revised Clause 49 - Corporate Governance Code as stipulated in the listing agreement with Stock Exchanges. A separate section on Corporate Governance alongwith Certificate from Ajay Behera & Associates, Company Secretaries, confirming level of Compliance is annexed and forms part of the Directors' Report.

A detailed report on Corporate Governance together with the compliance certificate from Ajay Behera & Associates, Company Secretaries is attached to this Annual Report. Management's Discussion and Analysis Report for the year under review, as stipulated under Clause 49 of the Listing Agreement with the Stock Exchanges are presented in separate sections forming part of the Annual Report.

The Audit Committee of the Board has been vested with powers and functions relating to Risk Management which inter alia includes (a) review of risk management policies and business processes to ensure that the business processes adopted and transactions entered into by the Company are designed to identify and mitigate potential risk; (b) laying down procedures relating to Risk assessment and minimization; and (c) formulation, implementation and monitoring of the risk management plan.

In compliance with the requirements of Section 178 of the Companies Act, 2013, the Nomination & Remuneration Committee of your Board had fixed various criteria for nominating a person on the Board which inter alia include desired size and composition of the Board, age limits, qualification / experience, areas of expertise and independence of individual. The Committee had also approved in-principle that the initial term of an Independent Director shall not exceed 5 years. Your Company has also adopted a Remuneration Policy, salient features whereof is annexed to this report.

Your Board has in accordance with the requirements of Companies Act, 2013 and Clause 49 of the Listing Agreement has adopted new policies and amended existing policies such as policy on Related Party Transaction, Code of Conduct for Directors and Senior Management and Whistle Blower and Vigil Mechanism Policy. These policies are available on the website of the Company and can be viewed on www.jainstudiosltd.com

Appreciation

Your Directors greatly appreciate the dedication and commitment of employees at all levels who have contributed towards the effective functioning of the Company. We also wish to convey gratitude to Company's Bankers, Financial Institutions, Government Authorities, Clients, Vendors, and Investors for their support and encouragement and look forward for their continued support in the future.

For and on Behalf of the Board

 (Dr. J.K. Jain)

Chairman & Managing Director

 Place: New Delhi

Date : 13th August, 2015