We are in the midst of very challenging times.  The global economic
 crisis has now adversely affected nearly all economies across the
 globe, both developed and developing. Inspite of our initial optimism,
 the Indian economy also stands severely affected by this crisis.
 
 The year 2008 started with a lot of promise of continuing the high
 growth of the previous years.  However, monetary measures to control
 runaway inflation towards the middle of the year and the credit crunch
 caused by the economic crisis in the later half of the year saw demand
 severely dampened and our sales sharply falling. The automotive
 markets, especially, were severely affected by this crisis. Overall,
 due to a good first three quarters your Company still managed to show
 decent results for the year, given the circumstances.
 
 What do we expect in 2009?
 
 For one, it will surely be a more difficult year than 2008 with the
 effect of economic crisis spreading in more and more segments of the
 economy.  Your Company has already begun activities to align itself to
 this new market situation to become a leaner and more agile
 organization. And in doing so we believe we can realize the
 opportunities out of this crisis. Fortunately your organization also
 has the necessary financial strength to do all this without
 compromising on our long-term goals where necessary prioritized
 investments towards manpower and facilities continue.
 
 In the long run do we believe the India growth story to be still
 strong?
 
 The answer is Yes, we do. Our continued focus on sustaining our
 long-term competencies is based on our confidence on the long-term
 prospects of the Indian economy. We believe the fundamentals are still
 strong and in time we will be back to where India should be - on a fast
 growth track.
 
 We will also continue our efforts on growing the non-automotive
 business at a faster pace than our automotive business as part of our
 de-risking strategy. Our automotive business will continue to be the
 most important segment of our business.
 
 To sustain our competitive edge in the market it is important that we
 continue to offer our customers products with an attractive value
 proposition.  This is especially important for the Indian market which
 has its own unique needs. You are already aware of our successes in the
 low-priced vehicle market and our efforts in this direction continue.
 
 How are we doing this?
 
 To give you an insight, we have chosen the theme for this years cover
 story to be on Innovation. Innovation as you will read in this article
 can be seen in nearly all areas of the Companys operations and is
 deeply rooted in our culture. We believe we have today the necessary
 organizational competencies and the right people within it to foster
 this culture.
 
 To conclude, in this atmosphere of gloom you can be confident that your
 Company has the necessary strength to not only sustain itself but is
 also well positioned to contribute to and benefit from the
 opportunities which the Indian market offers.
 
                                                 Yours sincerely,
                                                   A. Hieronimus