Directors'' Report to the Members
 
 The Directors have immense pleasure in presenting their report on the
 business and operations of the Company for the year ended March 31,
 2011.
 
 Financial Highlights :                             (Rs. in Lacs)
 
 The highlights of your Company''s financial results for the financial
 year April 1, 2010 to March 31, 2011 are as follows:
 
 Particulars                              31.03.2011       31.03.2010
 
 Total Income                               7,286.97          6079.38
 
 Total Expenses                             3,138.28          2812.87
 
 Operating Profit (PBDIT)                   4,148.69          3266.51
 
 Interest                                     488.29           502.80
 
 Depreciation                               2,125.71          1645.54
 
 Profit before Tax                          1,534.69          1118.17
 
 Provision for Income Tax including 
 Deferred Tax                                 331.87           190.59
 
 Net Profit after Tax                       1,202.82           927.58
 
 Appropriation
 
 Dividend                                     237.38           100.50
 
 Dividend Tax                                  39.42            17.08
 
 Transfer to General Reserve                  100.00           100.00
 
 Total Appropriations                         376.80           217.58
 
 Earning per Share: Basic and Diluted (in Rs.)
 
 Considering Extraordinary Items                1.56             1.23
 
 Without Considering Extraordinary Items        1.56             1.23
 
 Results of Operations : Total revenues earned during the year amounted
 to Rs. 7,286.97 Lacs compared to that of Rs.  6,079.38 Lacs in the
 previous Financial Year. The profit before tax has increased from Rs.
 1,118.17 Lacs in the previous Financial Year to Rs. 1,534.69 Lacs in
 the current Financial Year. During the year under review, the income
 from operations was Rs. 7,102.49 Lacs compared to Rs. 5,943.16 Lacs in
 the previous Financial Year. This reflects an increase of Rs.1,159.33
 Lacs, which is mainly due to the increase of income from learning
 solution business segment.
 
 The profit before interest, depreciation and tax during this period is
 Rs. 4,148.69 Lacs as compared to the previous Financial Year PBIDT i.e.
 Rs. 3,266.51 Lacs.
 
 As required by AS- 21, Consolidated Financial Statements are provided
 in the later section of the Annual Report.
 
 Business Review :
 
 (1) Software & E-Governance Services : During the year, the Company
 focused on domestic Software services and E-Governance opportunities,
 looking at the bleak scenario in USA. The revenue generated from the
 software segment during the Financial Year 2010-11 was Rs. 804.04 Lacs
 as against Rs. 985.24 Lacs during the last Financial Year. This reflect
 a decrease of 18.39 % i.e. Rs. 181.20 Lacs. Decline in the overseas
 business is due to slowdown in US Economy.
 
 Profit earned from this segment amount to Rs. 358.52 Lacs as compared
 to that of Rs. 477.95 Lacs during the previous Financial Year, which
 has resulted a decrease of 25%. The ratio of the segmental profit to
 the segmental revenue has decreased by 3.92 % from 48.51% to 44.59% as
 compared to the previous Financial Year.
 
 During the year end, JdVVNL has further extended their contract for
 providing and operating IT enabled call center services at Bikaner city
 for the next six months up to December 31, 2011 or till the
 finalization of the new tender. JdVVNL has recently issued LOI to the
 Company for Providing Manpower for operation of Customer Care Centre
 under R-APDRP at Jodhpur and agreement for the same has been signed
 with JdVVNL. This is a 3(Three) year project and total valuation of the
 project is approx. Rs. 3.02 Crores. Compucom is also executing the
 JVVNL order on BOOT basis of contract value of Rs. 11.38 Crores in
 Jaipur city and at Kota city value of Rs. 4.81 Crores. Under this
 contract your Company is providing the call center, fault rectification
 and CSC services, which are running successfully and widely
 appreciated.
 
 (2) Learning Solutions : Company now has 6082 schools and 2 million
 learners under its educational umbrella. The Company is successfully
 implementing the two big educational projects, first is ICT Project by
 secondary education department, Govt. of Rajasthan for providing
 computer education on BOOT basis in 2292 schools of Rajasthan. The
 second project is an IT Project on BOOT basis in 568 Government schools
 of Delhi. Company has witnessed the successful implementation of the
 Computer Aided Learning Program (CALP) project for imparting training
 in 836 Govt.  schools of Rajasthan worth Rs.10.68 Crores. We are
 pleased to inform you that during the year under review your Company
 has successfully implemented ICT-II project in 1550 Schools worth Rs.
 77.77 Crores and CALP II project in 836 Schools worth Rs. 10.41 Crores.
 The Company has massive plans for capturing the advantage of Indian
 education expenditure planned through Govt. of India promoted PPP model
 across India fueled by SSA (Sarva Shiksha Abhiyan).
 
 During the year under review revenue generated from learning solution
 business amounts to Rs. 6107.62 Lacs while the revenue generated in the
 previous Financial Year was Rs. 4761.16 Lacs, reflecting an increase of
 Rs. 1346.46 Lacs i.e. 28.28%. The increase is mainly due to execution
 of ICT II and CALP II projects of Govt. of Rajasthan. Profit earned
 from this segment has increased by 107.37 % to Rs. 927.47 Lacs in
 comparison to Rs. 447.25 Lacs in the previous Financial Year, which is
 mainly due to execution of high profit margin projects like new
 ICT/CALP II projects. In terms of ratio of segment profit to segment
 revenue it has increased to 15.19 %. Profit generated from this segment
 is 59.81% as compared to 38.69% of the previous Financial Year.
 
 (3) Wind Power Generation : The Company owns four wind power generation
 plants of 0.60 MW each, two at Jaisalmer and two at Sikar in Rajasthan.
 Company also owns a 0.8 MW Plant at Krishna (Andhra Pradesh). The
 Company has total installed Wind Power capacity of 3.2 MW. The
 operation and maintenance of the wind power project has been out-
 sourced to Enercon India Ltd. The revenue generated from this segment
 amounted to Rs. 190.83 Lacs in the current year as compared to Rs.
 196.76 Lacs during the previous year ended on March 31, 2010.
 
 (4) Treasury Activities : Treasury income includes capital gains,
 dividends from mutual funds and equity shares, interest on FDRs etc.
 During the year, the revenue generated from treasury operations has
 increased by Rs. 48.26 Lacs mainly due to increase in interest income
 on FDRs. During the year most of the funds were invested in FDRs, where
 returns were lower but safe in comparison to equity-oriented funds.
 
 (5) Subsidiary Companies :
 
 (a) ITneer Inc. is a wholly owned subsidiary of Compucom Software
 Limited. It has earned total revenue of US$ 4,28,492 during the
 Financial Year 2010-11. This reflects a decrease of approx. 27.36% as
 compared to the previous Financial Year. The Company has declared a net
 profit of US$ 6,428 as compared to the loss of US$ 15,848 in the
 previous Financial Year. The copy of the audited accounts together with
 the independent Auditors'' Report is provided in a separate section of
 this Annual Report.
 
 (b) CSL Infomedia Pvt. Ltd. is another subsidiary of Compucom Software
 Limited. It has earned total revenue of Rs. 24.55 Lacs during the
 Financial Year 2010-11. The Company is mainly operating in Multimedia,
 Content Development and Educational TV Segment. The copy of the audited
 accounts together with the independent Auditors'' Report is provided in
 a separate section of this Annual Report.
 
 Employee Stock Options :
 
 In 1999, the Company issued 1,00,000 Equity Shares of Rs. 10/- face
 value at par to Compucom Software Limited Employee Welfare Trust for
 the benefit of the employees and created a stock option plan. These
 shares have been irrevocably granted to the trust and are used for the
 benefit of the employees. As on March 31, 2011 the Trust has the
 ownership of 30,16,529 unutilized shares.
 
 During the Financial Year 2010-11, the Company has not issued fresh
 stock options.
 
 Directors'' Responsibility Statement : Pursuant to Section 217 (2AA) of
 the Companies Act, 1956, Directors state therein that:
 
 (a) In the preparation of the annual accounts, the applicable
 Accounting Standards have been followed along with proper explanations
 and disclosures relating to material departures.
 
 (b) The relevant accounting policies are applied consistently and the
 directors'' have 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 on March 31, 2011 and of the profit of the Company for
 the period.
 
 (c) Proper and sufficient care has been taken in 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.
 
 Dividend : In view of the Company''s profitable performance, your
 Directors are pleased to recommend, for approval of the Members at
 ensuing Annual General Meeting, a dividend @15% i.e. Rs. 0.30/- per
 equity share of Rs. 2/- each for the Financial Year 2010-2011.
 
 Dividend declared & paid during last 11 (Eleven) years
 
 Financial Year                           Dividend Rate
 
 1999-00                                         20%
 
 2000-01                                         25%
 
 2001-02                                         10%
 
 2002-03                                         25%
 
 2003-04                                         25%
 
 2004-05                                         25%
 
 2005-06                                         30%
 
 2006-07                                         30%
 
 2007-08**                                       15%
 
 2008-09***                                      10%
 
 2009-10                                         10%
 
 Book Value per Share : Details of book value during the last 12
 (Twelve) years is as under:
 
 Financial       No. of Shares          Face Value      Book Value
 Year                                   per share       Per share
                                                         (in Rs.)
 
 1999-00           5,000,000                  10          42.28
 
 2000-01           5,025,000                  10          55.74
 
 2001-02           5,025,000                  10          65.60
 
 2002-03           5,025,000                  10          69.00
 
 2003-04           5,025,000                  10          79.90
 
 2004-05           5,025,000                  10          90.79
 
 2005-06           5,025,000                  10          98.73
 
 2006-07           5,025,000                  10         105.89
 
 2007-08**        25,125,000               2 (10)         22.79
 
 2008-09***       502,50,000                   2          13.10
 
 2009-10          502,50,000                   2          14.47
 
 2010-11****     7,91,25,188                   2          12.26
 
 **Equity share of face value of Rs. 10 each subdivided into equity
 share of Face value of Rs. 2/- each. Record date for the same was
 October 15, 2007.
 
 *** The Company granted bonus issue in the ratio of 1:1. Record date
 for the same was December 26, 2008.
 
 ****The Company granted bonus issue in the ratio of 1:2. Record date
 for the same was October 20, 2010.
 
 **** Preferential issue of 37.50 Lacs Equity shares allotted on
 November 4, 2010.
 
 Fixed Deposits : During the Financial Year 2010-11, your Company had
 not accepted any fixed deposits nor renewed any deposit, falling within
 the definition of Section 58 A of the Companies Act, 1956.
 
 Awards : The Govt. of Rajasthan has communicated that Company has been
 selected for Excellence Award for Export Performance during the
 Financial Year 2008-09.
 
 Board of Directors : In accordance with the provisions of Articles of
 Association of your Company, Mr. Ajay Kumar Surana and Mr. Rajeev
 Sogani, Directors of the Company retire by rotation. Mr. Ajay Kumar
 Surana being eligible offer himself for reappointment. The Board
 recommends the reappointment of Mr. Ajay Kumar Surana. Mr. G. L.
 Chaudhary was appointed as an Additional Director in the Board Meeting
 held on August 9, 2011, sought to be appointed as a Director of the
 Company. The Board recommends the appointment of Mr. G. L. Chaudhary as
 a Director of the Company.
 
 Issue of Bonus Shares : During the Financial Year 2010-11, the Company
 had rewarded the shareholders by allotting bonus shares in the ratio of
 1:2 and made an allotment of 2,51,25,188 bonus shares of Rs. 2/- (two)
 each, to the eligible shareholders of the Company in the Board Meeting
 held on October 21, 2010. The said Bonus issue was recommended by the
 Board on July 31, 2010 and approved by the shareholders in the Annual
 General Meeting held on September 18, 2010.  Record date for the same
 was October 20, 2010.
 
 Preferential Issue : During the Financial Year 2010-11, the Board
 issued 25,00,000 convertible warrants and 37,50,000 Equity Shares of
 Rs. 2/- each, at an exercise price of Rs. 25.36/- in the Board Meeting
 held on November 4, 2010 as per the Special Resolution passed by the
 Company in its Extra Ordinary General Meeting held on October 25, 2010,
 to the following allottees:
 
 S.
 No. NAME OF ALLOTTEE                 NO. OF EQUITY  NO. OF CONVERTIBLE
                                     SHARES ALLOTTED WARRANTS ALLOTTED
 
 1.  Compucom Technologies Pvt. Ltd. 
    (Promoter)                             7,50,000       25,00,000
 
 2.  Rukmani Sales Pvt. Ltd. 
     (Non-Promoter)                       30,00,000               -
 
 Total                                    37,50,000       25,00,000
 
 In-Principle Approval for the same was received from Bombay Stock
 Exchange Ltd. on October 22, 2010. The above equity shares have been
 listed on BSE on April 11, 2011 & trading approval has been received on
 May 5, 2011.
 
 Strategic Investment in Educational Broadcasting, T.V., Entertainment &
 Media Segments : The Company made strategic investment of Rs. 3.25
 Crores in the form of equity shares at par in CSL Infomedia Pvt. Ltd.,
 making it a subsidiary , to venture into Educational, Television,
 Entertainment and Media segments.
 
 Auditors and Auditors'' Report : M/s S. Misra & Associates, Chartered
 Accountants, Statutory Auditors of the Company, retires at the
 forthcoming Annual General Meeting and confirmed their eligibility and
 willingness to accept the office, if reappointed.  The Board of
 Directors in its meeting on August 9, 2011 has recommended the
 appointment of M/s S. Misra & Associates as Statutory Auditors of the
 Company at the ensuing Annual General Meeting. The Auditors'' Report is
 self-explanatory and does not call for further explanation.
 
 Conservation Of Energy, Research & Development, Technology Absorption,
 Foreign Exchange Outgo : Disclosure under Section 217(1)(e) of the
 Companies Act, 1956, read with the Companies (Disclosure of Particulars
 in the Report of Board of Directors) Rules 1988 are given in the
 Annexure A.
 
 Particulars of Employees : As required by the provisions of Sub-Section
 217(2A) of the Companies Act, 1956, read with the Companies
 (Particulars of Employees) Rules, 1975, no employee had drawn
 remuneration at or above the limits mentioned therein.
 
 Human Resource Management and Employee Relation : Employees are vital
 assets of the Company. The Company has created a favorable
 work-environment that encourages innovation and nurturing of commercial
 and managerial talents in its operations. The Company also provides
 sharing of ownership of the Company through employee stock option
 scheme, wherein stock options are granted based on the cadre of the
 employees and the policy prevailing in the organization. The Company
 continues to have cordial relation with its employees.
 
 Quality Assurance : Your Company is an ISO 9001:2000 organization,
 certified by Det Norske Veritas (DNV) since 1998.  These standards
 enable us to identify risks at the initial planning stage of the
 project. The Company firmly believes in the pursuits of excellence to
 compete in this emerging and growing software market. Our focus has
 been on providing quality products and services to our customers.
 
 Your Company achieved CMMI level-3 certification and continues to
 implement the certification quality level in its operations.
 
 Corporate Governance : As required under the Listing Agreement with the
 Stock Exchange, a report on Corporate Governance is given in a separate
 section in this Annual Report.
 
 Acknowledgements : The directors sincerely appreciate the contributions
 made by all the employees, associates and business partners who have
 contributed towards the success of the Company. The directors are also
 thankful for the cooperation, support and assistance received from
 banks, investors, customers, central and state government departments,
 local authorities, vendors, strategic alliance partners, stock
 exchanges and all others associated with the activities of the Company.
 
 For and on behalf of the Board
 
 Surendra Kumar Surana                            R.P. Udawat
 
 Managing Director & CEO                            Director
 
 Jaipur, August 9, 2011