Dear Shareholders,

It is indeed my privilege to be presenting to you the highlights of the investments of your Company during the Financial Year 2012-13. Your Company remained resilient in the back drop of slowing GDP and a tough global economic environment.

The global economy remained sluggish. Structural bottlenecks, widening of the Current Account Deficit (CAD), inflation and uncertainty in the political environment hampered the growth of GDP in India.

According to the first advance estimates of national income for the year 2012-13 of the Central Statistics Office (CSO), the Indian economy is expected grew at its slowest pace in a decade at a mere 5% in 2012-13, on the back of dismal performance of the farm, manufacturing and services sectors.

In late 2012-13, the Indian Government announced a new round of reforms and deficit reduction measures to reverse India's slowdown. The outlook of India's medium-term growth is positive due to a young population and corresponding low dependency ratio, healthy savings and investment rates and increasing integration into the global economy. The greatest risk to the Indian economy continues to be the extremely high CAD. In the light of this scenario, while RBI has taken certain monetary measures to stimulate the economy, industrial revival will require greater facilitation in terms of effective policy measures to stimulate private investment.

Your Company adopted a wait and watch methodology for its investment as capital preservation remained the theme for this year. Your Company continued to hold its investments in the following sectors viz., Media, Power, Non-Banking Financial Institution, Banking and Real Estate besides holding a robust Treasury.

The performance of its investments

Media – IndusInd Media & Communications Limited (IMCL) - During the year, your Company's principal subsidiary - IMCL - successfully managed the first phase of digitalization, converting all analogue homes into digital homes in Mumbai, Delhi and Kolkata. Having received an All India Digital Addressable Cable license, IMCL converted around 2.5 million homes to digital in Phase I and Phase II cities as mandated by Government. IMCL continues to be one of the leading Multi-System Operators having pan-India presence with a reach of around 8.5 million subscribers in 36 locations.

IMCL infrastructure is adequately geared up to meet the opportunity presented by mandatory Digital Addressable System (DAS) and is currently supported by 10,000 km of hybrid fibre optic cable network, which includes 2,000 km of underground fibre. There are plans to introduce Value Added Services (VAS) in digital cable.

During the year, your Company applied for a HITS (Head-end in the sky) license, through its wholly owned subsidiary, with the Ministry of Information & Broadcasting. HITS is expected to provide white label services to over millions of customer in phase III and phase IV. This will results in substantial revenue to your company and handsome rewards to its shareholders by way of dividend.

Power – Hinduja Energy (India) Limited (HEIL) - Your Company remains invested in the Power Sector through its stake of 15.74% for Rs. 187 crores (fully invested) in HEIL – holding company of Power Assets of Hinduja Group. This translates into a 10% effective holding in the SPV – Hinduja National Power Corporation Ltd. The project of 1040 MW under the SPV is progressing well and will be commissioned during this financial year.

Non-Banking Finance Company - Hinduja Leyland Finance Limited (HLFL) - Your Company purchased 2,00,00,000 shares i.e. a stake of 8.9% in HLFL – an Asset Financing Company (mainly Vehicles and Construction Equipments) - at par in early 2011. It further acquired 88,88,890 shares at par under the Rights issuance of the Company. As of the end of financial year 2013, it retained a stake of around 6.7%, after having divested a small portion (2.15%) of it to an overseas investor. The sale took place at Rs. 40 per share, clocking a return of 4 times in about two years.

The prospects of HLFL look positive; the Company registered a Profit After Tax (PAT) of Rs. 91.38 crores at the end of financial year 2013 vis-a-vis Rs. 83.69 crores in the previous year. This was despite the tough business environment that the Automobile industry faced during the last year.

NBFCs, especially vehicle financing, has seen a lot of investor appetite in the last year. HLFL is also close to finalising an equity infusion by a Private Equity investor of Rs. 200 crores in the coming year for funding its growth plans. This will bring down the percentage holding for your Company in HLFL to a tad below 5%. The possibility of listing HLFL in the future remains high.

Banking – IndusInd Bank Limited (IBL) - Your Company, directly and indirectly through its subsidiaries, holds 1,82,37,383 Shares, a stake of 3.49% in IBL as of March 31, 2013 as against 1,51,32,383 Shares a stake of 3.01% as of March 31, 2012.

Post the management change in 2008, IBL has smoothly turned around the business with an improvement across various business parameters viz. efficiency, productivity and profitability. Its superior franchise, well experienced employee base, operational expertise and an understanding of the market environment has catapulted the Bank in the Top 3 league of new generation Private Sector Banks in India. The confidence of the investor community in the stock was evident from the response IBL received on its Qualified Institutional Placement (QIP) from high quality FIIs as well as domestic investors. The subscription happened at a premium to the market price wherein the Bank raised around Rs. 2,000 crores. This capital increase will meet the growth plans that Bank has set for itself for the next planning cycle where it will focus on building 'Scale with Profitability'.

The stock has appreciated around 53%, since the last year.

Real Estate - The Company continues to pursue its efforts in seeking clearance for the development of its real estate in Bengaluru including attending the legal suits related to title in respect of 47.2 acres land. The land was purchased at Rs. 0.14 crores per acre and today the market value stands at Rs. 3.08 crores per acre. Post clearance of all the issues, the Company will take up development of the property.

Your Company through its wholly owned subsidiary had acquired 4.75 acres of land in Hyderabad at a price of Rs. 5 crores per acre. As of March 31, 2013, the reckoner rate of land stands as Rs. 12.1 crores per acre, registering an unrealised gain of 142%.

Mobile Medical Units - Your Company has generously funded the Hinduja Foundation in implementing its mobile health care project targeting the rural poor in the tribal areas of Thane district. The contributions have been made u/s 35 AC which is 100% tax exempt. The project focuses on providing access to basic health care facilities for tribal people, who, due to a variety of reasons ranging from financial to geographical constraints, remain largely neglected.

This marks the beginning of our contribution to the society in a tangible manner. We will continue to pursue our efforts in giving back to the society and contributing in making lives of people better.

Way forward - Whilst the above initiatives will take shape during the coming year, your Company's management will remain committed to evaluating the most lucrative opportunities for value creation for its stakeholders. We would broaden our horizons to include new sectors to the boutique that are most promising.

I would like to place on record my sincere appreciation of your unstinted support to the Company. I would also like to thank the Directors, Management and Employees for the good performance registered. Also my thanks go out to our Bankers, Auditors and Advisors for their help and guidance during the year to maintain the highest standards of corporate governance, a top priority for the Group.