Dear Shareholders,
 
 The real estate sector in India is being recognized as an
 infrastructure service that is driving the economic growth engine of
 the Country. Currently about 5% of India''s GDP is contributed by the
 housing sector. Demand for real estate is expected to grow at a
 compounded annual growth rate (CAGR) of 19% until 2014. Tier- I
 metropolitan cities are projected to account for about 40% of this.
 Growing requirements of space from sectors such as education, health
 care and tourism provide opportunities in the real estate sector.
 
 India''s GDP had downward movement consistently in the last three
 quarters of 2012. In 2013, this trend will prevail - though the quantum
 of revision will be lower. The country''s economic environment will
 certainly improve in 2013, with a corresponding (though lagging) gain
 in momentum for real estate. The most tangible benefits of economic
 improvements on the Indian real estate space will be seen in 2013-14.
 
 In Chennai, Old Mahabalipuram Road and GST Road are emerging as good
 realty destinations as there are a significant number of under
 construction projects by good developers. In 2011, Chennai has
 witnessed the maximum supply and the city has witnessed an average of
 22-33 percent unsold stock in last four years. Although, the market
 faced 36 percent fall in new launches.
 
 According to a real estate research, 2012 was not a thriving year for
 the real estate sector and even in 2013 the real estate market is not
 likely to witness the graph of success.  Although there is a steep rise
 in residential properties, the private equity sector dried up. If the
 land acquisition bill and the real estate regulation bill is approved,
 there might be a revival in the economy.
 
 During the year under review, your Company has made an average
 performance in terms of Sales and Profits. In terms of operational
 performance, many of its projects which are large residential complexes
 and Township are under Joint Venture and are progressing well. Your
 Company will earn good profits from these projects in the year to come.
 Recent past your Company has launched a residential project comprising
 of 1,94,145 Sq ft. at Mugappair, Chennai.  Another residential project
 is in pipeline which is located at Nandambakkam, Chennai will be
 launched shortly.
 
 We at Arihant, believe in building integrity by providing qualitative
 service and maintaining healthy and cordial relationship with our
 Customers and Investors.
 
 Your Directors wishes to place on record its sincere thanks to Bankers,
 Financial Institutions, Chennai Metropolitan Development Authority and
 Corporation of Chennai and related departments of Govt. of Tamil Nadu
 for having supported us on all our efforts and endeavours and all those
 who work for or are associated with Arihant.
 
                                                    Thank You
 
                                               (Kamal Lunawath) 
 
                                                      CMD