Dear Shareholders,

I am pleased to report that your Company has completed one more successful year. The Treasury and Media segments of your Company have registered steady growth. Before getting into the specifics of your Company's performance, let me say a few words about the current economic scenario and business environment.

While the rest of the world was grappling with the after-effects of the European debt crisis, the growth momentum of Indian economy has also slowed down considerably over the past year. Gross Domestic Product (GDP) growth in the financial year 2011-12 is estimated at 6.9% as against 8.4% a year ago, mainly due to weakening of industrial growth. High current account deficit, reduced foreign investments and delay in tax and fiscal reforms are some of the hindrances plaguing the Indian Economy. But despite the low growth of GDP, India remains one of the fastest growing economies of the world as all major countries including the fast growing emerging economies are witnessing a significant slowdown.

The Reserve Bank of India (RBI) has partly succeeded in its efforts to tame inflation, which shows signs of moderating. With the monetary easing now expected in coming quarters, cost of money will touch lower levels and improve investment climate. This will make the country confident of bringing back the rhythm of high growth of 8-9% by pushing through further reforms, strengthening infrastructure and generating opportunities for investment and employment.

Performance

Treasury Operations - Your Company's portfolio performed well. The market value of portfolio went up steadily from Rs. 435 crores in the opening of the year to Rs. 572 crores at the close of the year. The overall average gain in mark to market for the portfolio was 32% over last year. The Company booked a profit of Rs. 46.33 crores during the year.

Investments - Your Company stayed on course in its core strategy of identifying and incubating new businesses for the benefit of our shareholders. During the year, your Company invested 8.9% of the equity of the newly formed Hinduja Leyland Finance Limited (HLFL) at par, a company engaged in providing finance for automotive and capital goods sectors. HLFL is expected to grow rapidly and your Company should reap rich dividends in the years ahead.

Similarly, your Company has taken a decision to invest in the power generation sector, which is poised for medium and long-term growth. The Board has approved an investment of upto 10% effective stake in Hinduja National Power Corporation Limited (HNPCL) through a 16% stake in the Hinduja Energy India Limited (HEIL), the holding company of the Hinduja Group's energy business. HEIL plans to create a portfolio of 10,000 MW of generation capacity in the next 5-7 years.

HEIL also has plans for developing renewable energy assets such as Wind, Solar and Biomass. One thermal project of HEIL of 1,040 MW is being developed through its subsidiary Hinduja National Power Corporation Limited (HNPCL) at Vishakhapatnam, in Andhra Pradesh. Construction is in full swing and ahead of schedule. Your Company had invested Rs. 250 mn in HEIL through its wholly owned subsidiary Grant Investrade Limited (GIL). The investment in this sector will provide handsome returns to your company.

Media - During the year, your Company's principal subsidiary IndusInd Media and Communications Limited (IMCL) continued with its consolidation strategy by acquiring several small networks and entering into Joint Ventures with medium sized networks. Its present footprint extends to 34 cities. IMCL remains among the top three Multi System Operators (MSOs) in the country with the distinction of having the highest profitability in the Indian cable TV industry.

IMCL is now on the cusp of the digital revolution being ushered in by Government's mandated policy of digitizing the Cable Networks. The Digital Addressable System (DAS) now being introduced by Government from 1st November 2012 in four phases offers a unique opportunity to IMCL to make all its subscribers addressable and to improve its subscription revenues manifold.

Digitisation will enable IMCL, to achieve triple play. The Company has crafted a strategic plan for next 4-5 years, when they would target to achieve industry leadership in the quality and range of services offered to the customers. With rapid digitalization and expansion, IMCL hopes to reach over two million digital homes in next six months and over ten million digital homes in next 4-5 years. The consolidation plans of IMCL will focus on the rich socio-economic areas to achieve higher revenue growth.

New services for the digital cable foray will include HD Services, Hybrid STBs for Cable and Internet, Value added services for digital cable such as Voice on Demand (VoD), Pay Per View (PPV), Gaming, E-learning, Broadband and Voice Over Internet Protocol (VOIP)/ Internet Telephony services will be expanded through its national Internet Service Provider (ISP) license.

The content side of the media sector is being driven by In Entertainment (India) Limited. IEIL is adopting an approach of focusing on development of own film projects rather than buying and acquiring distribution rights from other producers. IEIL recently produced movie titled "Billa 2" in Tamil, a prequel to the popular Hindi film "Don". The Tamil film and its Telugu dubbed version are expected to be released mid July 2012.

Real Estate - IDL Specialty Chemicals Limited (IDL), wholly owned subsidiary of your Company had acquired 4.75 acres of land at Kukatpally, in Hyderabad. crores. Plans are being drawn up to monetize this asset by developing the property. The plans for developing the 47.2 acres property in the BIAPPA zone near the Bengaluru Airport High-way are underway and would be taken up along with the Joint Developer once the registration of the title in the name of the Company is done and all the clearances are in place.

I would like to conclude by thanking all of you for your unstinted support during the past year. My thanks to the Directors, Management and Staff for the good performance registered. Also my thanks 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.