CESC

From the Chairmans desk
 
 Dear Shareholder,
 
 2008-09 was a tough year for the world economy. The first half
 witnessed the highest commodity prices over the previous century; the
 second half saw the biggest financial meltdown since the Great
 Depression. The Indian economy was also affected; liquidity dried up
 and industrial growth fell. The GDP shrank from 9.1% in ’08 to 6.8% in
 09.
 
 In this difficult situation, your Company has increased both topline
 and profitability. CESC’s sales revenue for ’09 grew by 9% to Rs.
 3,031 crore. Earnings before depreciation and taxation (EBDT) grew by
 nearly 12% to Rs. 640 crore and profit after taxes (PAT) increased by
 over 15% to reach Rs. 410 crore.
 
 Let me share some highlights with you.
 
 - Budge Budge and Southern, two of CESC’s three pulverised fuel plants,
 are among the country’s top ten power plants in terms of plant
 efficiency.
 
 - CESC is one of the very few power utilities around the world that has
 earned Clean Development Mechanism (CDM) credits.
 
 - New Cossipore, a sixty-year old generating station, still generates
 445 MU of power during the ‘peak demand’ period – thanks to meticulous
 and innovative maintenance practices.
 
 - Budge Budge, Southern and New Cossipore have been OHSAS 18001
 certified. The three pulverised fuel plants generate zero water
 effluents – which has been recognised by the West Bengal Pollution
 Control Board.
 
 - The new 250 MW third unit at Budge Budge is fast nearing completion;
 with this, the Company hopes to generate additional power for the
 consumer and reduce its dependence on outside sources.
 
 - CESC has set up its first 220 kV / 132 kV substation; to optimise
 operational flexibility, it will be upgrading all its substations to
 220 kV over a period of time.
 
 - The Company is also rapidly progressing towards completing its 85 km
 long transmission line from Budge Budge.
 
 CESC’s generating stations are located mainly within the metropolitan
 area of Kolkata. With environmental concerns taking centre stage in
 thermal power generation, it is difficult to add capacity. We are,
 therefore, looking at installing power plants outside Kolkata - in West
 Bengal, Bihar and Jharkhand - through our associates and subsidiaries.
 We are also looking at ways and means to generate ‘cleaner’ and more
 environmentally friendly thermal power for our consumers.
 
 Although the second half of 2008-09 was marked by a lower rate of
 growth, I see the downturn playing out by 2009, and the emergence of
 stronger growth in 2010. Therefore, I see a greater demand for power in
 the near future. I am confident that your Company will achieve healthy
 growth in the following years and generate greater shareholder value.
 
 Let me thank all employees and associates for working so hard during
 the year and showing their unwavering commitment to the Company and to
 you, dear shareholders, for your support.
 
 CESC and Kolkata have grown together for the last 110 years; and I am
 sure that we will grow together in the future as well.
 
 22nd May, 2009                                          Dr. R P Goenka