Arshiya International

The Directors are pleased to present the 27th Annual report together
 with the Audited Accounts for the financial year ended 31st March,
 2008.
 
 The name of the Company was changed from Arshhiya technologies
 international ltd. to Arshiya international ltd with effect from 28th
 September, 2007.
 
 A) Summarized FINANCIAL RESULTS ARSHIYA INTERNATIONAL Ltd
 
                                          YEAR ENDED          YEAR ENDED
                                          31.03.2008          31.03.2007
                                        (Rs. in Lacs)      (Rs. in lacs)
 
 income from operations and other income     20806.97           9172.87
 expenditure                                 18926.54           8642.32
 Profit Before Depreciation & tax             1880.42            530.55
 Depreciation                                   64.25             34.18
 Profit Before tax, exceptional items and 
 Prior period items                           1816.17            496.38
 exceptional items                                  -            318.11
 Prior period items(net)                       (33.88)          (137.99)
 Provision for taxation                        546.05            278.96
 Profit After tax                             1236.24            397.55
 Balance B/f                                   515.48            123.24
 Surplus in P&l A/c of erstwhile BDP 
 India Pvt ltd                                      -            290.15
 Amount available for Appropriation           1751.71            810.94
 Proposed Dividend                             456.03            218.56
 Dividend tax                                   77.50             37.14
 transfer to general reserve                   123.62             39.75
 Balance Carried to Balance Sheet             1094.55            515.48
 
 the income from operations, along with other income has increased by
 more than 125 per cent as compared to the previous year. the Profit
 before tax has recorded an increase of 163 per cent over that of the
 previous year and the Profit After tax has increased by 210 per cent as
 against the previous year.
 
 b) SUMMARIZED FINANCIAL RESULTS – ARSHIYA INTERNATIONAL LTD AND ITS
 SUBSIDIARIES
 
                                            YEAR ENDED        YEAR ENDED
                                            31.03.2008        31.03.2007
                                          (Rs. in Lacs)    (Rs. in lacs)
 
 income from operations and other income       40744.97       18741.50
 expenditure                                   35037.34       16458.29
 Profit Before interest, Depreciation & tax     5801.57        2350.09
 Depreciation                                    416.64         291.40
 Profit Before tax, exceptional items and 
 Prior period items                             5290.99        1991.80
 exceptional items                                    -         318.11
 Prior period items (net)                         33.88         137.99
 Provision for taxation                          737.26         377.35
 Profit After tax and Minority interest         4537.52        1751.19
 
 on a Consolidated basis your Company has recorded a 117 per cent
 increase in income and 159 per cent increase in profit after tax over
 the previous year.
 
 DIVIDEND
 
 your Directors recommend a dividend of 40 per cent for the year
 2007-08. the proposed dividend would absorb a sum of Rs. 456.03 lacs
 and Rs. 77.50 lacs towards dividend tax.
 
 BUSINESS AND OUT LOOK
 
 As an integrated supply chain services company, your Company is
 providing end to end logistics and supply chain solutions to customers
 across the world with it support developed inhouse by your Company’s
 subsidiary viz.  Cyberlog technologies international Pte ltd.
 
 While your Company is committed to providing efficient and innovative
 solutions in the core areas of the operations, your Company’s strategy
 during the year under review included following infrastructural
 development project proposals to provide a complete range of supply
 chain management services to customers across the globe in offering a
 comprehensive and integrated supply chain services.
 
 (i) Free trade Warehousing zone (FTWZ):
 
 your Company is setting up a Free trade Warehousing Zone, a special
 category SEZ at Sai Village, District Raigad, Maharashtra with a
 project outlay of approx. Rs. 1200 Crores for which acquisition of land
 is nearing completion. your Company has placed orders for capital
 equipments and construction activities are expected to go in full
 stream by the third quarter of the current financial year. the Ministry
 of Commerce at new Delhi has approved at the Board of Approvals meeting
 to grant in principle approval to your Company’s FTWZ at Raigad Dist.
 Maharashtra.
 
 your Company has made substantial acquisition of land for the FTWZ
 proposed at Uttar Pradesh and near Nagpur. your Company has plans to
 develop two more FTWZ in eastern and Southern India. the project outlay
 for the FTWZ at Uttar Pradesh and near Nagpur are estimated approx Rs.
 1100 Crores and Rs. 900 Crores respectively.
 
 (ii) containerised rail operations:
 
 your Company has secured Category i license from the Ministry of
 railways for permission to operate contrainerised rail services as a
 part of your Company’s objective of providing comprehensive range of
 services to the customers for both domestic and exim cargo movement
 across the country. your Company has also placed orders for 75 rakes
 with the suppliers and the deliveries of the rakes are expected to
 commence from November this year. to augment these services, your
 Company has also initiated process for identification of land required
 for private siding operations across the pan India rail operation
 network. the project outlay for the containerised rail operations is
 estimated at Rs. 1600 Crores.
 
 your Company has also incorporated a subsidiary namely Arshiya rail
 infrastructure limited for the containerised rail operations.
 
 (iii) Both the FTWZ projects and containerised rail operations are
 strategized with a view to result in significant reduction in
 consumption of fossil fuel and result in reduced carbon emission and
 for this purpose your Company will be using environment friendly energy
 sources for generation of electricity and reduction in carbon emission.
 
 The Board of your Company is confident that the aforesaid
 infrastructural investments initiated by your Company being capital
 intensive will be successfully implemented with the support of banks,
 financial institutions and investors. the aforesaid initiatives are
 expected to bring down logistics costs significantly at the same time
 strengthening the operational advantages for your Company to a
 considerable extent.
 
 FIXED DEPOSITS
 
 your Company has not accepted Fixed Deposits within the meaning of
 Section 58A of the Companies Act, 1956 during the year.
 
 SUBSIDIARIES
 
 The Company has following nine subsidiaries as on 31st March, 2008:
 
 1) Arshiya hong kong limited, Hongkong and its subsidiaries viz. BDP
 (Dubai) llC, BDP (Qatar) Wll and Arshiya logistics llC, Oman
 
 2) Cyberlog technologies international Pte. ltd., Singapore and its
 subsidiaries viz. Cyberlog technologies (U.A. E.) FZE, Cyberlog
 technologies inc. USA and Cyberlog technologies hong kong limited
 
 3) Genco (India) Private limited
 
 Subsequent to the year ended 31st March 2008, the following Companies
 became subsidiaries of your Company: Arshiya Western logistics
 infrastructure ltd; Flat World Processes ltd; Arshiya northern
 logistics infrastructure ltd; Arshiya logistics infrastructure ltd &
 its Subsidiaries viz. Arshiya Central logistics infrastructure ltd,
 Arshiya Southern logistics infrastructure ltd and Arshiya eastern
 logistics infrastructure ltd; Arshiya northern Distripark ltd; Arshiya
 Distripark ltd & its Subsidiaries viz. Arshiya Central Distripark ltd,
 Arshiya Southern Distripark ltd, Arshiya Western Distripark ltd and
 Arshiya eastern Distripark ltd; Cyberlog technologies (india) Pvt ltd
 and Arshiya rail infrastructure ltd.
 
 Out of the aforesaid subsidiaries, Arshiya logistics infrastructure
 ltd, Arshiya Distripark ltd, Arshiya Western logistics infrastructure
 ltd and Flat World Processes ltd were incorporated during the later
 part of the financial year 2007-08 and the Company was subscriber to
 their Memorandum of Association. however, the shares so agreed to be
 subscribed by your Company were actually issued in the subsequent
 financial year. As the first financial year of the said subsidiaries
 will end only on 31st March, 2009, in view of provisions of Section
 212(2)(d) of the Companies Act, 1956 the accounts of the said
 subsidiaries are not required to be prepared and attached to the
 financial statements of your Company for the year ended 31st March,
 2008.
 
 Your Company has applied to the Ministry of Corporate Affairs u/s 212
 of the Companies Act, 1956 for granting exemption from attaching the
 Balance Sheets etc. of the aforesaid nine subsidiaries, for the
 financial year ended 31st March, 2008. in view of the same the Balance
 sheets etc. of aforesaid nine subsidiaries have not been attached to
 the Balance sheet of the Company.
 
 The Annual Accounts of the above-referred nine subsidiaries as on 31st
 March, 2008 and the related detailed information will be made available
 to the investors of the Company and its subsidiaries seeking such
 information at any point of time. the annual accounts of the subsidiary
 companies will also be kept for inspection by any investor at the
 registered/head office of the Company and that of the subsidiary
 companies concerned. A gist of financial performance of the
 subsidiaries is given in this annual report.
 
 SHARE CAPITAL
 
 During the year each equity share of R. 10/- each was sub divided into
 five equity shares of R. 2/- each.
 
 Your Company issued and allotted 11,290,322 equity shares of R. 2/-
 each at a price of R. 310/- per share to Qualified institutional Buyers
 on 20th December, 2007 on a preferential allotment basis in terms of
 SEBIlines for issue of shares to QIBs.
 
 Further 20,01,500 equity shares of R. 2/- each against conversion of
 4,00,300 warrants (out of total 750,000 warrants issued in February
 2007) were allotted on 18th March, 2008 in favour of warrant holders
 who exercised their option for conversion into equity shares.
 
 Your Company has received listing and trading approval from Bombay
 Stock exchange limited (BSE)for the aforesaid shares.
 
 Out of net proceeds of Rs. 34149 lacs received by the Company on
 placement to QIBs, Rs. 21583.78 lacs have been utilised towards payment
 of capital advance and capital expenditure for ongoing FTWZ Projects,
 rs. 6044.52 lacs have been paid for ongoing rail transport Project
 including payment to indian railway for obtaining Category i licence to
 run Container trains and balance rs. 6520.70 lacs is kept in deposits
 with Banks, Corporates and in units of mutual funds.
 
 CONSOLIDATED FINANCIAL STATEMENTS
 
 Consolidated Financial Statements are prepared in accordance with
 Accounting Standard - 21 “Consolidated Financial Statement” issued by
 ICAI. your Directors have attached the Consolidated Financial
 Statements for the financial year ended 31st March, 2008 which form
 part of the Annual report and Accounts.
 
 CORPORATE GOVERNANCE
 
 A separate report on Corporate governance including a Certificate from
 a Practising Company Secretary confirming compliance with Corporate
 governance as stipulated under clause 49 of the listing Agreement
 entered into with BSE is annexed hereto and forms part of the report.
 
 DIRECTORS
 
 Mr.Francis X Bolte & Mr. Richard Bolte jr. retire by rotation and being
 eligible, offer themselves for re-appointment.
 
 GLOBAL ADVISORY BOARD
 
 Your Company has a seven member global Advisory Board consisting of
 following eminent personalities having rich global experience in
 diverse fields including business, management and supply chain. the
 global Advisory Board usually meets twice a year. the valuable advice
 and guidance of the Advisory Board plays a crucial role in formulating
 strategies, expansion plans and creating a Company with uniqueness in
 supply chain services sector.
 
 1. Dr. jerry (Yoram) Wind
 
 2. Dr. Frank-jurgan Richter
 
 3. Mr. William Adamopoulos
 
 4. Dr. John Gattorna
 
 5. Mr. Richard Taffet
 
 6. Mr.Michael Proffitt
 
 7. Prof.g. Raghuram
 
 ARSHIYA EMPLOYEES STOCK OPTION PLAN 2007
 
 Arshiya employee Stock option Plan, 2007, (ESOP 2007) was approved at
 the extra-ordinary general Meeting of the members held on 20th
 November, 2007 and adopted by the Board at its meeting held on 28th
 January, 2008.  the aggregate number of options/underlying shares that
 may be granted under the ESOP Plan are 10,00,000 for the employees of
 the Company and 10,00,000 for the employees of Subsidiaries including
 step down subsidiaries, in India and out of india, existing or which
 may be formed in future. ESoP 2007 is administered by the Compensation
 Committee of the Board.
 
 The Company has received in-Principle Approval for listing of 20,00,000
 equity shares of rs. 2/- each; as may arise once all the options are
 exercised; from the Bombay Stock exchange limited.
 
 Under tranche i, the Compensation Committee at its meeting held on 15th
 February, 2008, granted 5,41,800 options, at a grant price of rs. 210/-
 per option to the employees of the Company and 8,69,900 options to the
 employees of subsidiaries/step down subsidiaries.
 
 Under tranche ii, the Compensation Committee at its meeting held on
 24th April, 2008, granted 1,06,300 options, at a grant price of rs.
 210/- per option to the employees of the Company and 27,600 options to
 the employees of subsidiaries/step down subsidiaries.
 
 Details of options granted and other disclosures; as on 31st March,
 2008; under Securities and exchange Board of india (employee Stock
 option Scheme and employee Stock Purchase Scheme) guidelines 1999; are
 set out in Annexure to this report.
 
 DIRECTORS RESPONSIBILITY STATEMENTS
 
 in accordance with the provisions of Section 217 (2AA) of the Companies
 Act, 1956, with regard to the Directors responsibility Statement, the
 Directors confirm that:
 
 a) in the preparation of the annual accounts, the applicable accounting
 standards have been followed and there has been no material departures;
 
 b) the selected accounting policies were applied consistently and the
 Directors made judgements 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 31st March, 2008 and of the profit of the Company for the
 year ended on that date.
 
 c) proper and sufficient care has been taken for the maintenance of
 adequate accounting records in accordance with the provisions of the
 Companies Act, 1956 for safeguarding the assets of the Company and for
 preventing and detecting fraud and other irregularities.
 
 d) the annual accounts have been prepared on a going concern basis.
 
 HUMAN RESOURCES
 
 Your Company recognizes the importance of human resources which is a
 key and vital asset for enabling your Company to provide an integrated
 supply chain platform to customers across the globe under an unique
 umbrella of services offered by your Company. While on the one hand
 your Company is committed in strengthening its human resources by
 induction of experienced and competent professionals, on the other
 hand, your Company is formulating appropriate policies, systems and
 schemes which will create adequate opportunity for growth in career and
 create a working environment which enhances productivity and create a
 strong satisfied profile of customers from india and abroad who take
 pride in services offered by your Company.
 
 Your Company also has undertaken aggressive recruitment for its FtWZ
 and rail activities targeting a mix of young talent from reputed
 Management institutions and persons with rich experience from relevant
 industry. Further in order to suitably appreciate and reward the
 efforts of the employees, your Company granted Stock options during the
 year. A focused approach has been adopted to motivate and encourage the
 employees to meet challenges of competition and work towards growth
 strategy of your Company.
 
 HEALTH, SAFETY AND ENVIRONMENT
 
 As a responsible corporate citizen your Company lays due emphasis on
 health and safety aspects of its human capital, operations and overall
 working. Constantly aware of its obligations towards maintaining and
 improving the environment, all the possible steps are being taken to
 meet the toughest environmental standards on pollution, effluents etc.
 in various spheres of its activities.
 
 CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
 EARNING & OUT GO :
 
 the Company did not undertake any activity during the year that would
 require disclosure under Section 217(1)(e) of the Companies Act, 1956
 relating to Conservation of energy and technology Absorption.
 
 Foreign exchange earnings: rs. 14,19,22,174/-
 Foreign exchange outgo: rs. 29,25,53,817/-
 
 PARTICULARS OF EMPLOYEES
 
 The information required under Section 217(2A) of the Companies Act,
 1956 and the Companies (Particulars of employees) rules, 1975 as
 amended, forms part of this report. however, in terms of Section
 219(1)(b)(iv) of the Companies Act, 1956 this report is being sent
 excluding the aforesaid information. the same will be provided to the
 members on request in writing.
 
 AUDITORS
 
 M/s. Price Waterhouse, Chartered Accountants, Mumbai, Auditors of the
 Company, retire at the ensuing Annual general Meeting and are eligible
 for reappointment.
 
 ACKNOWLEDGEMENT
 
 The Board places on record its sincere appreciation of the contribution
 of employees at all levels, clients, vendors, investors, bankers and
 all other stakeholders towards performance of the Company during the
 year under review.
 
                             For and on behalf of the Board of Directors
 
 Place : Mumbai                                            Ajay S Mittal
 Date  : 30th July, 2008                    chairman & managing director