The Directors have pleasure to present the Thirty Third Annual Report together with the Audited Financial Statements of the Company for the Financial Year ended 31^st March, 2018.

Financial Performance:

(Rs. in Lakh)

Dividend:

Your Directors are pleased to recommend a Dividend of Rs.2.70 (Rupees Two and Paise Seventy) per share on 15,12,51,188 Equity Shares of Rs.10/- each fully paid up, for the year ended on 31^st March, 2018 (Previous year Rs.2.70 per share). The Dividend, if approved by the Shareholders at the ensuing 33^rd Annual General Meeting, shall be paid to those Members, whose names appear in the Register of Members of the Company as on 7^th September, 2018. In respect of Shares held in dematerialized form, it will be paid to Shareholders whose names are furnished by National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL), as beneficial owners as on 07-09-2018.

OPERATIONS:

Vadodara Gas based Stations:

Station I (145 MW):

During the year under review, the Station generated 676.210 Million Units (MUs) at the Plant Load Factor (PLF) of 53.24% as against generation of 701.893 MUs at PLF of 55.26% during the preceding year. The Plant Availability Factor (PAF) was at 92.81% during the year under review as against 98.15% during the preceding year.

Planned Shutdown for improvement in Heat Rate of GT-1 and Renovation of Inlet Air Filter house and Exhaust System was carried out during the year. Major Overhauling of STG-1, Combustion Inspection of GT-2 and Statutory Annual Inspections of HRSG were also carried out during the year.

Your Directors are glad to inform that protecting the interest of Participating Units & Gujarat Urja Vikas Nigam Limited (GUVNL) to meet individual scheduled demand, Company qualified in competitive bidding and has received Letter of Award from GUVNL for the sale of 25 MW power on 'Round The Clock' basis starting from 01/03/2018 to 19/05/2018 and further extended up to 30/06/2018. By virtue of the above initiative, operations of Station at optimum loading is ensured during lean period of power demand.

Station - II (165 MW):

The Power Purchase Agreement (PPA) with GUVNL expired on 31/07/2016 and considering the factors such as significant balance useful life of the plant, consistent power demand and especially during peak hours observed in the region, proximity of the plant at the heart of load centre, situated at Petrochemicals Complex etc. The Company has filed a petition with Gujarat Energy Regulatory Commission (GERC) for regulatory recourse to utilize the idle plant capacity in lieu of expiry of PPA, to mitigate peak shortages in the grid due to increased share of renewable energy associated with its uncertainty and variability requiring quick generation ramp rates at a short notice for safety and sustainability of the Grid.

During the year under review, under Short Term Open Access (STOA) this station has been scheduled for 35.62 Million Units (MUs) at a PLF of 5.12% as against generation of 59.011 MUs at a Plant Load Factor (PLF) of 4.08% in the preceding year under merit order dispatch.

Continuous efforts are made to maintain optimum available supply of gas for the Stations.

Company has also made commercial arrangements to supply surplus Demineralized (DM) water to some of the adjoining industries, which generates additional revenue and increases capacity utilization factor of the idle assets.

Surat Lignite Power Plant (SLPP):

Phase-I (2 x 125 MW Units 1 & 2):

During the year under review, Phase-I generated 1 589.341 Million Units (MUs) at a Plant Load Factor (PLF) of 72.57% as against 1 526.640 MUs at a PLF of 69.71% during the preceding year. Plant Availability Factor (PAF) was 83.24% as against 84.98% during the preceding year. Commercial availability was at 74.83% as against 78.87% during the preceding year. Low Plant Availability was mainly due to temporary disruption of supply of lignite due to prolonged monsoon.

Phase II (2 x 125 MW Units 3 & 4):

During the year under review, Phase-II generated 1 682.374 MUs at a PLF of 76.82% as against 1651.556 MUs at a PLF of 75.41% during the preceding year. Plant Availability Factor (PAF) was 85.41% as against 87.80% during the preceding year. Commercial availability was at 80.07% as against 86.41% during the preceding year.

Constant endeavors are being made to improve the overall performance of the Units, including technology improvement and modifications. The required maintenance program for the upkeep of the Units was undertaken during the year under review.

Mining:

During the year under review, Valia Lignite Mine recorded the highest ever lignite production of 29.06 Lakh Te as against 28.05 Lakh Te during the preceding year and highest ever limestone production of 2.86 Lakh Te from Vastan Limestone Mine as against 2.52 Lakh Te during the preceding year.

Most of the requirement of lignite was met from our captive Vastan Lignite Mine and Mangrol-Valia Lignite Mine. To meet the demand of all the four units for operations during monsoon, highest ever Lignite Stock of 6.29 Lakh Te has been created on 31/03/2018 as against the 4.95 Lakh Te on 31/03/2017.

5 MW PV based Solar Power Plant:

During the year under review, 5 MW PV based Solar Power Pl ant at SLPP generated 7. 03 4 MU s with 16.06% PLF as against 7.5 78 MUs with PLF of 1 7.30% during the preceding year.

Less generation and PLF during the year under review was mainly due to extended cloudy weather.

2 x 1 MW Distributed Solar Power Plants (DSPP):

During the year under review, the 1 MW Amrol DSPP generated 1.498 MUs at a Capacity Utilization Factor (CUF) of 17.10% and the 1 MW Vastan DSPP generated 1.283 MU at a CUF of 14.64% respectively.

Major activities were carried out in Agriculture field during the year under review under the guidance of Navsari and Anand Agricultural Universities.

Your Directors are pleased to inform that this novel concept of Distributed Agri Solar Power Project has received National Level "Golden Peacock Eco-Innovation" Award of the Institute of Directors, New Delhi.

112.4 MW Wind Power Projects:

The Company has total installed and commissioned capacity of 112.4 MW of Wind Power Projects at different sites across State of Gujarat.

During the year under review, the 112.4 MW Wind farms have generated 252 . 7 M U s at a Capacity Utilization Factor (CUF) of 25.66%.

2 x 40 MW Solar Power Projects at Gujarat Solar Park, Charanka:

Your Directors are pleased to inform that your Company has successfully commissioned 2x40 MW Solar Power Projects at Gujarat Solar Park, Village Charanka, District Patan during the year under review and Plot - 1 (40 MW) has generated 32.81 MUs with 19.26% CUF whereas Plot - 3 (40 MW) has generated 38. 73 MUs with 19.85% CUF since Unit Commercial Operation (Plot-1: 20 MW - 27.09.201 7, balance: 20 MW - 14.10.2017; Plot-3: 30 MW - 03.09.2017, balance: 10 MW - 27.09.2017).

Safety Performance:

The health and safety of al l the employees is the prime concern of the Company. Your Directors are pleased to inform that your Company is making sincere and committed efforts to maintain the safety of Plant equipment and creating a safe and heal thy work environment for the employees. The Company has been spending sufficient amount for the health and safety related activities. Constant efforts are made to maintain accident free operations at all the locations.

Your Company has adopted a comprehensive Health and Safety Policy under the Integrated Management System (IMS).

Your Directors are glad to inform that the Company has successfully completed accident free operations for the entire year under review i.e. FY 2017-18.

Safety Audit is conducted through external competent agency to en sure zero accident and cover al l employees and contract workmen for safety related training.

Environmental Protection:

The Company recognizes Environment Management as an integral function of its operations. Towards this end your Company has adopted appropriate technology for control of pollutants at source. Vadodara Plant:

Your Company has also imposed total ban on using thermocol and plastic below 40 micron size packing material for all incoming goods. Disposal of e-waste generated h as been arranged through Central Pollution Control Board (CPCB) registered Vendors. Surat Lignite Power Plant (SLPP):

During the year under review, your Company replaced total internals of four fields and partially replaced internals of one field (out of fourteen fields) of Unit-4 Electrostatic Precipitator (ESP), total internals of One field (out of twelve fields) of Unit-2 ESP during annual over hauling at total expenditure of Rs.385.08 Lakh to reduce suspended particulate matter (SPM) emission through stack / chimney.

Your Company planted 201 nos. of saplings (100% survival rate) in the Plant and Colony premises for better green coverage.

Growth Pl ans:

75 MW (AC) Solar Power Project at Charanka:

Your Directors are pleased to inform that your Company has emerged as successful Bidder for 75 MW (AC) Solar Power Project during reverse e-auction for 500 MW Solar Power Project held by Gujarat Urja Vikas Nigam Limited (GUVNL). The Company has issued LoI for Engineering, Procurement & Construction (EPC) contract on 19/03/2018 to Bharat Heavy Electricals Limited (BHEL) for the said Solar Power Project at Gujarat Solar Park, Charanka.

Accreditation for Integrated Management System (IMS) under ISO certifications:

Your Directors are pleased to inform that during the year under review your Company has successfully maintained standard guidelines for IMS covering ISO:9001 :2008, ISO:14001:2004 and OHSAS 1 8001:2007 certification for Quality Management System (QMS), Environment Management System (EMS) and Occupational Health and Safety Assessment Series (OHSAS) and ISO 50001:201 1 for Energy Management System (EnMS) Certification for its Power Stations at Vadodara and SLPP. Your Company is one of the first group of Power Pl ants to have impl emented and obtained ISO 50001:201 1 Certification. Surveillance Audit for all the standards including up gradation of Quality and Environment Management System Standards (2015 version) have been successfully conducted in May, 2018 which is accredited by TUV India Limited and is also valid for FY 2018-19.

Awards and Accolades:

During the year under review, Valia Lignite Mine has won overall second prize for the Overall Performance among the lignite mines of Gujarat State, from Director General of Mining Safety during Gujarat Lignite Mines Safety & Swachhata Week 2017-18. Valia Mine has also won prizes for 'Record Maintenance', 'Publicity, Propaganda & House Keeping and 'Thrust Area (Safety Management Plan)' and Vastan Lignite Mine has won prizes for 'Health, First Aid & Vocational Training', 'Survey Office, Pl an s & Sections' and 'Mine Illumination & Electrical Installations'.

Vastan Limestone Mine has won First prize for the Systematic & Scientific Development among the 74 Limestone and Bauxite Mines of Gujarat State during 25^th Environment & Mineral Conservation Week 201718. Vastan Limestone Mine has also won prizes for 'Mineral Conservation' and 'Publicity, Propaganda & House Keeping'.

SLPP received National Energy Management Award- 2017 for Outstanding Performance in Energy Conservation conferred by Confederation of Indian Industry (CII), Hyderabad and identified as 'Energy Efficient Unit'.

For Outstanding Performance in Environment Management, SLPP received 'Environment Excellence Award- 201 7' conferred by Mission Energy Foundation jointly promoted by Ministry of Power (MoP), Ministry of Environment and Forest & Climate Change (MoEF and CC) and Ministry of Science and Technology. National Award for Fly Ash Utilization in F.Y. 2017-18 was awarded to SLPP by Mission Energy Foundation jointly supported by Ministry of Environment & Forest and Climate Change (MoEF & CC), Ministry of Power, Coal, Renewable Energy, Ministry of Road and Highways, Ministry of Science and Technology & Ministry of Urban Development.

Subsidiary:

During the previous Financial Year 2016-17, the Company had approached the National Company Law Tribunal (NCLT), Ahmedabad Bench seeking its approval to the Scheme of Arrangement (the Scheme) in the nature of Merger of the Company with its wholly owned subsidiary GIPCL Projects and Consultancy Company Limited (GIPCO). The Hon'ble NCLT, vide its Orders dated 06/1 1/201 7 had approved the Scheme, subject to fulfilling certain conditions by GIPCL. In view of the cost involved, your Board had decided to go for Voluntary Liquidation of GIPCO under the Insolvency and Bankruptcy Code (IBC), 2016 instead of the Scheme of Arrangement in the nature of Merger.

On application, the National Company Law Tribunal (NCLT), Ahmedabad Bench has allowed Gujarat Industries Power Company Limited and GIPCL Projects and Consultancy Company Limited to withdraw their respective Applications seeking approval of the Hon'ble Bench to the Scheme of Arrangement in the nature of Merger of GIPCO with GIPCL & vide its two separate Orders dated 26/04/2018, recalled the earlier order dated 06/1 1/201 7.

Public Deposits:

During the year 2017-18, your Company has not accepted/renewed any Fixed Deposit. As on the date of this Report, there is No Deposit either unpaid / unclaimed or due for transfer to Investors' Education and Protection Fund (IEPF).

Particulars of loans, guarantees or investments:

Loans, guarantees and investments covered under Section 186 of the Companies Act, 2013, form part of the Notes to the financial statements provided in this Annual Report.

Listing Regulations compliance:

Equity Shares of your Company are listed on BSE Limited (BSE) and National Stock Exchange of India Limited (NSE) and their Listing Fees for the FY 2018-19 have been paid.

Insurance:

The properties and the insurable interest of the Company are adequately insured. The Company has also taken necessary insurance cover as required under the Public Liability Insurance Act, 1991.

Corporate Social Responsibility (CSR) Initiatives:

As part of its CSR initiatives, the Company has undertaken projects in the areas of Health, Education, Livelihood, Development of Village Infrastructure, etc. These projects are in accordance with Schedule VII to the Companies Act, 2013.

Report on CSR activities is annexed to this Report as Annexure 'A'.

Energy Conservation and Technology Absorption:

The measures taken by your Company towards Energy Conservation and Technology Absorption are given in the Annexure 'C' to this Report. These measures have resulted in conserving about 2.59 million cubic meter of gas fuel equivalent to 2468 MToE at Vadodara Station and 13.29 Million Units (MUs) electrical energy at SLPP.

Related Party Transactions:

There were no materially significant transactions made by the Company with Promoters, Directors or Key Managerial Personnel or other designated persons which may have potential conflict with the interests of the Company.

All related party transactions are placed before the Audit Committee and also the Board for approval. Omnibus approval of the Audit Committee has been obtained for transactions which are of repetitive nature.

Particulars of contracts or arrangements with related parties referred to in Section 188(1) of the Companies Act, 2013, in the prescribed Form AOC-2, is appended as Annexure 'E' and forms part of this Report.

The Policy on Related Party Transactions (RPTs) is uploaded on the website of the Company and can be accessed on the following link: http://www.gipcl.com/ corporate-policies.htm

None of the Directors has pecuniary relationships or transactions vis-a-vis the Company.

Vigil Mechanism or Whistle Blower Policy:

The Company has a Vigil Policy / Whistle Blower Policy to deal with instance of fraud and mismanagement, if any. The said Policy is explained in the Corporate Governance Report and also posted on the website of the Company at following link: http://www.gipcl.com/corporate-policies.htm

Directors' Responsibility Statement:

The Board of Directors of the Company confirms:

a. that in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departure;

b. that the selected accounting policies were applied consistently and Directors made judgment and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at 31^st March, 2018 and of the profit of the Company for the year ended on that date;

c. that proper and sufficient care has been taken for maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

d. that the Annual Accounts have been prepared on a going concern basis;

e. internal financial controls to be followed by the company have been laid down and that such internal financial controls are adequate and operating effectively; and

f. Proper systems have been devised to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

Corporate Governance:

A detailed report on Corporate Governance along with Certificate dated 24^th May, 2018 issued by J J Gandhi & Co., Practicing Company Secretaries, Vadodara (CP No. 2515) is annexed forming part of this Report.

Management Discussion and Analysis:

A report on Management Discussion and Analysis dealing with Business Operations and Performance, Research and Development, Expansion Project, Safety and Environment, Human Resource Development, Corporate Social Responsibility etc. is annexed forming part of this Report.

Risk Management:

The Board of Directors review the Report on Risk Management and Risk Minimization on quarterly basis. The provisions of Listing Regulations relating to Risk Management are not presently applicable to the Company.

Directors:

Government of Gujarat (GoG) vide Notification/ Resolution dated 7^th August, 2018, has appointed Shri Raj Gopal , I AS (DI N : 022523 58), Principal Secretary, Energy & Petrochemicals Department (EPD), as Chairman of your Company vice Shri Sujit Gulati, IAS, (DIN: 001 77274) w.e.f. 7^th August, 2018.

The Board of Directors of you r Company has appointed Shri Raj Gopal, IAS (DIN:02252358) as Additional Director and Chairman of the Company w.e.f. 07.08.201 8. Shri Raj Gopal, IAS (DIN: 02252358) holds office of Director up to the date of the ensuing 33^rd Annual General Meeting (AGM) of the Company.

Your Directors recommend for your approval Resolution at Sr. No. 5 of the Notice of the 33^rd AGM for appointment of Shri Raj Gopal, IAS, as Nominee Director of the Company.

The Board places on record its sincere appreciation for the leadership, valuable guidance and support extended by Shri Sujit Gulati, IAS during his tenure as Chairman of the Company.

Vide Notification No. AIS/35.2018/29/G dated 18^th August, 2018, Government of Gujarat (GoG), General Administration Department has placed the services of Smt. Vatsala Vasudeva, IAS (DIN: 0701 7455) for appointment as Managing Director of your Company vice Smt. Shahmeena Husain, IAS (DIN: 03584560).

Accordingly, pursuant to the provisions of Article 94, 95 & 96 of the Articles of Association of the Company, the Board of Directors has appointed Smt. Vatsala Vasudeva, IAS (DIN: 0701 7455) as Additional Director and Man aging Director of your Company vice Smt. Shahmeena Husain, IAS (DIN : 03584560) w.e.f. 20^th August, 2018.

The Board places on record its sincere appreciation for the leadership and valuable contributions made by Smt. Shahmeena Husain, IAS, during her tenure as Managing Director of the Company.

Your Directors recommend for your approval resolution at Sr. 6 of the Notice of 33^rd AGM for appointment of Smt. Vatsala Vasudeva, IAS (DIN: 0701 7455) as Director and Managing Director of the Company.

The 32^nd AGM was held on 18^th September, 2017, post which IDBI Bank Limited has vide its letter dated 10^th May, 2018, withdrawn the nomination of Shri Janakiraman M (DIN: 06919906), with immediate effect and the same was noted by the Board of Directors. The Board places on record its sincere appreciation for the guidance and support extended by Shri Janakiraman M, during his tenure as Director of the Company.

Shri Pankaj Joshi, IAS (DIN: 05323992) and Shri Milind Torawane, IAS (DIN: 03632394), Directors of the Company retire by rotation at the ensuing Annual General Meeting and being eligible, offer themselves for re-appointment.

Your Directors recommend for your approval resolutions for the re-appointment of Shri Pankaj Joshi, IAS (DIN: 05323992) and Shri Milind Torawane, IAS (DIN: 03632394) as Directors of the Company, liable to retire by rotation, as stated in the Notice of the 33^rd AGM.

Policy on Directors' Appointment and Remuneration:

The Company has formulated and adopted a Policy on Directors' Appointment and Remuneration and the same is accessible on the website of the Company: http://www.gipcl.com/corporate-policies.htm

Performance Evaluation of Board, Committees and Directors:

Pursuant to the provisions of Section 178(2) of the Companies Act, 2013 and Regulation 19 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, your Company has constituted a Nomination & Remuneration (N R) Committee of Directors to, inter alia, evaluate the performance of Directors, the Board and various Committees of the Board.

Appraisal of each Director of the Company is based on the broad criteria mentioned below as required under the provisions of Section 134(3)(p) of the Companies Act, 2013 (the Act).

1. Knowledge of the Job Profile;

2. Various Directions provided in the best interest of the Com pany on key issues; review of compliance management;

3. Achievement of Targets budget v/s actual and reasons for deviations; contribution towards new projects;

4. Detailed analysis of internal control functions; and

5. Thorough compliance with the Code of conduct. The NR Committee shall evaluate the performance of each member of the Board of Directors with reference of th e authority under th e Nomination and Remuneration Policy of the Company framed in accordance with the provisions of Section 178 of the Act and as per the evaluation criteria mentioned above.

Evaluation of Independent Directors shall be carried out by the entire Board in the same manner as it is done for other Directors of the Company except the Director being evaluated.

Based on the performance evaluation of each and every Director and the Chairman of the Company, the Committee shall provide the ratings based on each criteria.

Evaluation of Executive Director of the Company is done by the entire Board except the Director being evaluated. The meeting for the purpose of evaluation of performance of Board Members is held at least once in a year. The Company has disclosed the criteria laid down by the NR Committee for performance evaluation, on its website for the reference and also in the Annual Report of the Company.

Particulars of Employees:

The information required pursuant to Section 197 read with Rule 5 of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 in respect of employees of the Company, is not applicable as no Employee was paid remuneration during the year in excess of Rs.1.02 Crores when employed throughout the year and Rs.8.50 Lakh per month when employed for a part of the year. Further, there was no employee holding 2% or more of the equity shares of the Company during 2017-18.

The information required pursuant to Section 197 read with Rule 5 of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, in respect of employees of the Company, will be provided upon request.

The detail s of top ten employees in term s of remuneration drawn during the year 2017-18 is given at Annexure 'F' to this Board's Report.

In terms of Section 136 of the Act, the Report and Accounts are being sent to the Members and others entitled thereto, excluding the information on employees' particulars which is available for inspection by the Members at the Registered Office of the Company during 3:30 p.m. to 5:30 p.m. on all working days of the Company up to the date of the ensuing 33^rd AGM. N one of such employees is a relative of any Director of the Company.

None of such employees hold [by themselves or along with their spouse and dependent children(s)] more than two percent of the equity shares of the Company.

Auditors:

Internal:

K N Mehta & Company, Chartered Accountants, Vadodara, (ICAI Firm Reg. No.:1 06242W) were appointed as Internal Auditors of the Company for the Financial Year 2017-18 and they have submitted their Report to the Audit Committee of Directors.

K N Mehta & Company, Chartered Accountants, Vadodara, (ICAI Firm Reg. No.:106242W) have been appointed as Internal Auditors of the Company for the Financial Year 2018-19.

The Audit Committee of Directors periodically reviews the reports of Internal Auditors.

Statutory:

The Members at their 30^th AGM have appointed K C Mehta & Co., Chartered Accountants, Vadodara (ICAI Firm Reg. No.:106237W) as Statutory Auditors of the Company, for a period of five consecutive financial years i.e. from FY 2015-16 to FY 2019-20.

The Companies (Amendment) Act, 2017 and the Companies (Audit and Auditors) Second Amendment Rules, 2018, have done away with the provision of ratification of the appointment of Statutory Auditors for each year.

Cost:

Cost records as specified by the Central Government under sub section (1) of Section 148 of the Companies Act, 2013, have been maintained by your Company during the year under review.

Diwanji & Associates, Cost Auditors, Vadodara (Firm Registration No.:1 00227) were appointed as Cost Auditors of the Company for the Financial Year 2017-18.

The Board of Directors has appointed Diwanji & Company (Firm Registration No.:000339) as Cost Auditors of the Company for the Financial Year 2018-19. Resolution at Sr.No. 8 of the Notice of 33^rd AGM is recommended for ratification of the Members for the remuneration payable to Cost Auditors for the Financial Year 2018-19.

Secretarial:

J J Gandhi & Co., Practicing Company Secretaries, Vadodara, (CP No. 2515) have been appointed as Secretarial Auditors of the Company for the year 201718. Report of J J Gandhi & Co. for the Financial Year 2017-18 ended on 31^st March, 2018 in the prescribed Form-MR 3 is annexed to this Report as Annexure 'B'. Your Company is in the process of appointing one more Independent Director to be compliant with the provisions of Regulation 1 7(1)(b) of the Listing Regulations.

Extract of Annual Return:

The details forming part of the extract of Annual Return in prescribed Form MGT-9 is annexed to this Report as Annexure 'D'.

Your Directors further state that, the Company has constituted an Internal Complaints Committee under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013, and no case was reported during the year under review. Acknowledgements:

The Board of Directors places on record its gratitude and appreciation to the Government of India, Government of Gujarat, Financial Institutions, Banks, Insurance companies, Business Associates, Promoters, Shareholders and Employees of the Company for their valuable support and faith reposed by them in the Company.

For and On behalf of the Board

Shri Raj Gopal, IAS

Date: 29^th August, 2018. Chairman

Place: Gandhinagar (DIN: 02252358)