The Directors are pleased to present the 18th Annual Report together
 with the statement of audited accounts of the Company for the financial
 year ended on December 31, 2011.
 
 Financial Highlights
 
 The following table summarizes the financial highlights of your
 Company, on a standalone basis, for the financial year under review:
 
                                                      (Amount in Rs.)
 
 Particulars                            Year ended     Year ended
                                        31st December, 
                                        2011           31st December,
                                                       2010 
                                       (12 months)    (18 months)
 
 Total Income                           53,65,07,714     119,29,85,522
 
 Profit Before Interest, Depreciation 
 and Taxes                               7,26,35,079      39,83,74,913
 
 Less: (a) Interest                      1,87,82,500       4,30,58,343
 
 (b) Depreciation                       17,71,48,232      37,01,00,290
 
 Profit/(Loss) Before Tax              (12,32,95,653)     (1,47,83,720)
 
 Less: Provision for - (a) Provision 
 for Current Tax                           10,72,000       1,21,90,000
 
 (b) Deferred Tax                       (1,03,70,322)     (1,68,84,584)
 
 Profit/(Loss) After Tax               (11,39,97,331)     (1,00,89,136)
 
 Note: The figures for the current year are for a period of 12 months as
 against 18 months in the previous period and hence, are not comparable.
 
 Financial Review
 
 The turnover of the Company for the financial year ended 31st December,
 2011, reported a decrease of 55.03% from Rs.  11929.85 lakhs in the
 previous year to Rs. 5365.08 lakhs in the year under review.
 
 The Company has reported a Profit before interest, depreciation and tax
 of Rs. 726.35 lakhs and after providing Rs.  187.83 lakhs towards
 interest, Rs. 1771.48 lakhs towards depreciation and adjusting Rs.
 92.98 lakhs towards tax, the net loss amounts to Rs. 1139.97 lakhs.
 
 Business Review
 
 During the current financial year ended December 31, 2011, the
 businesses across all verticals met with a substantial setback on
 account of factors both external and beyond the control of the
 management and internal relating to issues such as marketing structure
 and reach, product pricing etc. Dhanus has, over the past two years,
 been trying to make efforts to reverse the downslide in business by
 attempting to restructure its businesses and salvage the Company''s
 business clientele and marketing reach.
 
 Telecom
 
 With the Company facing a recession throughout the year under review,
 and on account of growing financial instability and economic downturn
 across various parts of the globe, more significantly in Europe, and
 making an impact in India, the tourism industry suffered substantially
 thus adversely influencing the overseas travels of Indians. The
 Company''s telecom services were thus impacted as Indians traveling
 abroad happen to be the exclusive target customer segment in this
 vertical. V-tel continues to contribute a major share to the Company''s
 top line. The Company continues to make efforts to arrest this negative
 trend by reviewing and drawing new plans both on the product and
 marketing front.
 
 Telematics
 
 The Company''s telematics vertical brand ''Fleetrac'' showed a significant
 negative growth on account of recession in the transportation and
 automobile sector. The Company is having a relook at the Company''s
 marketing strategies, client reach, pricing policies and strategies.
 Your Company plans to revisit its business model in this segment and
 review its financial viability and thereafter decide on its renewed
 launch.
 
 IT/ITES
 
 The marginal reversal in the recessionary conditions in the US did not
 do much in terms of reviving the fortunes of the outsourcing business
 of your Company. Morover, the anti-sourcing sentiments prevailing in
 the US also added to lack of fresh business from the US. This has
 affected the Company''s main customer segment, and the anti-outsourcing
 sentiments prevailing in the US on account of large scale unemployment
 continued to impact this segment of Company''s business this year too.
 The BPO business had sustained a negative growth in its business and
 the Company succumbed to pricing and margin pressures.
 
 Trading Activities
 
 The Company had forayed into a new business segment viz., Trading
 Activity in November 2010. The Company primarily was engaged in the
 trading of computer products, accessories and peripheral items. The
 Company started this business in the first week of November, 2010 and
 did robust business in this segment initially, although with nominal
 margin levels. However, the Company continued this business till June
 2011 anticipating increased volume of business and also upward
 scalability in the profit margins. The Company however realized that it
 was not to happen and it was essentially a low-margin with not much of
 perceptible scalability and therefore decided to suspend this activity
 in the second quarter of the financial year under review till a
 comprehensive review of this segment of business and its viability is
 analyzed.
 
 Current strategy:
 
 The Company''s primary aim is to be a global communications company,
 utilizing emerging technologies to provide convergent communication
 services. The business model of the Company revolves around its core
 competence i.e., Telecom & Networking.
 
 The Company proposes to review its entire gamut of existing businesses,
 marketing structure and strategy and adopt a pragmatic approach in
 analyzing its ability to achieve a dedicated revival plan in each of
 these businesses.
 
 The Company''s business opportunities are undoubtedly high in various
 parts of the world wherever there is a perceptible presence of Indian
 diaspora.
 
 Management Discussion and Analysis
 
 A detailed report on Management Discussion & Analysis for the financial
 year ended December 31, 2011 as stipulated under Clause 49 of the
 listing agreement with the Stock Exchanges in India is provided as a
 separate chapter in this Annual Report.
 
 Issue of Convertible Warrants
 
 As mentioned in our earlier Report for the financial year 2009-10, your
 Company made firm financial arrangements to take advantage of business
 opportunities that may arise in future, as the Company believes that it
 needs to have an inorganic- growth approach till a self-sustaining
 financial strength is reached.
 
 The Company therefore issued 15,00,00,000 Convertible Equity Warrants
 to select group of investors/allottees on February 21, 2011.
 Thereafter, on receipt of full consideration, your Company converted
 8,32,68,333 Warrants into Equity Shares of equivalent amount on March
 31, 2011 and the balance 6,67,31,667 Warrants into Equity Shares of
 equivalent amount on July 9, 2011.
 
 Bonus Shares
 
 Your Company decided to capitalize its existing reserves by issuing
 Bonus Shares to its Equity Shareholders in the ratio of 12:5 (i.e., 12
 equity shares for every 5 equity shares held as on the Record Date).
 Your Company, after receiving the requisite approvals from the Stock
 Exchanges, successfully made the allotment of 40,30,62,312 Bonus
 Shares.
 
 Public Deposits
 
 Your Company has not accepted any public deposits.
 
 Directors
 
 In compliance with the provisions of the Companies Act, 1956 and in
 accordance with the Company''s Articles of Association, Shri. G. Rathan
 Kumar and Shri. A.D. Sudhindra, Directors, retire by rotation at this
 Annual General Meeting scheduled on September 25, 2012 and, being
 eligible, offer themselves for re-appointment.
 
 It needs to be mentioned here that the Company had seven Directors at
 the end of financial year 2009-10. However, one of the independent
 Directors expired consequent to which the strength of the Board reduced
 to six at the end of the financial year ended 31st December, 2011.
 Amongst the remaining six, the resignation of two independent Directors
 was accepted by the Board in its meeting on 18th March, 2012. In the
 same meeting, three Additional Directors were appointed bringing the
 strength of the Board to seven. The Additional Directors would come up
 for confirmation as Directors in the ensuing Annual General Meeting.
 
 During the year and the intervening period post the closure of the
 financial year and the date of this Report, the following developments
 in the Board took place:
 
 Shri. Darshan Suryakant Shah, Non-Executive and Independent Director of
 the Company resigned on February 24, 2012 and ceased to be a Director.
 His resignation was accepted by the Board in its meeting held on March
 18, 2012.
 
 Shri. R. Radhakrishna, Non-Executive and Independent Director of the
 Company resigned on August 9, 2011 and ceased to be a Director. His
 resignation was accepted by the Board in its meeting held on March 18,
 2012.
 
 Consequent to the untimely demise of Shri. S. Manoharan, Non-Executive
 & Independent Director, his name was removed from the Board in its
 meeting on May 14, 2011.
 
 During the period between the end of the financial year 2011 and the
 date of this Report, Shri. Kumar Raichand Madan, Shri. U. Parthasarathy
 and Shri. S. Sriram were appointed as Additional Directors w.e.f March
 18, 2012. They will hold office till the conclusion of the ensuing
 Annual General Meeting of the Company. The Board welcomes Shri. Kumar
 Raichand Madan, Shri. U. Parthsarathy and Shri. S. Sriram on board and
 looks forward to their active participation on various deliberations.
 
 The Board appreciates the contributions made by Shri. Darshan Suryakant
 Shah, Shri. R. Radhakrishna and Shri. S.  Manoharan during their tenure
 as Directors of the Company.
 
 The Board of Directors inform the members that all the directors of
 your Company have confirmed that, in terms of Section 274(1)(g) of the
 Companies Act, 1956, they are not disqualified to act as directors of
 your Company.
 
 Directors Responsibility Statement
 
 Pursuant to the requirements of sub-section 2AA of Section 217 of the
 Companies (Amendment) Act 2001, the Directors confirm that:
 
 (i) In preparation of the annual accounts, the applicable accounting
 standards have been followed and proper explanations have been provided
 for material departures, wherever applicable.
 
 (ii) The Directors have selected such accounting policies and applied
 them consistently, and made judgments 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 December, 2011 and the loss of the Company
 for the financial year ended 31st December, 2011.
 
 (iii) The Directors have taken proper and sufficient care for the
 maintenance of adequate accounting records in accordance with the
 provisions of the Company''s Act, 1956, for safeguarding the assets of
 the Company and for preventing and detecting fraud and other
 irregularities.
 
 (iv) The Directors have prepared the annual accounts on a going concern
 basis.
 
 Auditors
 
 M/s. P.C. Acharya & Co., Chartered Accountants, the Statutory Auditors,
 will retire at the conclusion of the forthcoming Annual General Meeting
 and are eligible for re-appointment. The Audit Committee and your Board
 recommend their reappointment as Auditors of the Company for a further
 period of one year and to fix their remuneration. They have furnished
 to the Company a certificate of their eligibility for appointment as
 auditors, pursuant to section 224 (1B) of the Companies Act, 1956.
 
 The Board of Directors shall subsequent to their appointment determine
 the terms and conditions of their appointment, scope of work, and
 allocation of responsibilities such as statutory audit, internal audit,
 taxation, tax audit etc and to accordingly fix their remuneration.
 
 Auditor''s Report
 
 With regard to the qualifications and emphasis of matter contained in
 the Auditor''s Report of Dhanus Technologies Limited, our explanations
 are given below:
 
 i.  Note (b) and (c) of the 4th para of the Auditor''s Report - Note 1.2
 (a) and (b) of Schedule 1 & 2 - Notes to Accounts to the financial
 statements
 
 The Company has four business verticals and has a large number of
 debtors and creditors as its business across various service verticals
 is of retail nature. Also, the Company''s services and products have a
 wide geographical reach as well. Consequently, the reconciliation and
 control accounts of receivables and payables are not fully complete,
 although substantially covered. The Company however believes that
 non-reconciliation in such accounts will not have any serious and
 perceptible impact on the revenues and expenses recognized.
 
 ii.  Note (d) of the 4th para of the Auditor''s Report
 
 The Company has maintained a proper system of accounts. The Company
 confirms that the purported deviation from Accounting Standards
 prescribed under AS-6, AS-9, AS-10, AS-22 and AS-28 will in no way have
 any material adverse impact on the Profit & Loss Account and also the
 Asset Liability position of the Company.  The Company shall however
 make extra efforts to bring the systems in line with the accounting
 Standards expected of the Company.
 
 iii. Note (e) & (f) of the 4th para of the Auditor''s Report
 
 The Company agrees that reconciliation of Trade Receivables and
 Payables is yet to be fully completed.  However, the Company firmly
 believes that non-reconciliation and control accounts of receivables
 and payables will not have any serious and perceptible impact on the
 revenues and expenses recognized as substantial and critical
 reconciliations have not provided any adverse indication or cause for
 concern.
 
 iv.  Note (g) of the 4th para of the Auditor''s Report
 
 The inability to quantify the value of current assets including
 debtors, loans and advances from a mark to market perspective will not
 have any material impact on the asset liability position of the
 Company. The Company''s fixed assets being very large in number as it
 primarily comprises of high-value routers, switches, servers, computing
 systems, integrators etc., the Company is in the process of completing
 the physical verification of its fixed assets. The Company certifies
 that it fully owns the title to the assets and the cost of purchase and
 depreciation levied on them is accurate and in terms of generally
 accepted accounting principles.  Kindly refer to Note 1.1 on Fixed
 Assets and corresponding write up on depreciation on assets.
 
 v Note (h) of the 4th para of the Auditor''s Report
 
 The Board agrees with the statement that the investment in M/s Borusan
 Telekom, Turkey is possibly irrecoverable. The Company however proposes
 to attempt recovering the initial advance given towards share purchase,
 although the Company agrees that the attempt may be an exercise in
 futility and accordingly appropriate steps in this regard would be
 followed to write off the investment after all possible efforts towards
 recovery are completely exhausted.
 
 The Company disagrees with the view that the amount advanced to M/s
 Sreeven Infocom Limited is irrecoverable. Sreeven Infocom is a healthy
 company and the Company is in talks with the management of Sreeven
 Infocom to recover the amount advanced earlier.
 
 Since the qualifications made by the Auditor''s in the Report on the
 Consolidated financial statements is similar to the ones made in the
 Standalone financial statements, the above explanations apply equally
 to those as well.
 
 Audit Committee
 
 The Audit Committee consists of three members namely Shri. G. Rathan
 Kumar, Justice (Retd.) Shri. S. Kalyanam and Shri. U. Parthasarathy,
 all of whom are independent. Shri. G. Rathan Kumar is the Chairman of
 the Audit Committee. All members of the Audit Committee possess
 sufficient knowledge and experience in the field of Finance and
 Accounts.
 
 Subsidiary Companies
 
 Dhanus Global Medicare Limited, India and Dhanus Technologies Inc., USA
 continues to be wholly owned subsidiaries of your company. The
 statement under section 212 of the Companies Act, 1956 along with a
 statement of additional information of subsidiaries is attached
 herewith.
 
 Listing
 
 The Equity Shares continue to be listed on Bombay Stock Exchange
 Limited (BSE) and National Stock Exchange of India Limited (NSE). Both
 these exchanges have nation-wide terminals and therefore,
 shareholders/investors are not facing any difficulty in trading the
 shares of the Company from any part of the country. The Company has
 paid the annual listing fee for the year 2012-13 to the BSE and NSE and
 the annual custodial fee to National Securities Depository Limited
 (NSDL) and Central Depository Services (India) Limited (CDSL).
 
 Conservation of Energy, Technology Absorption and Foreign Exchange
 Earnings and Outgo.
 
 Information as required 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, is annexed as an Annexure to this
 Report.
 
 Particulars of Employees
 
 In terms of the provisions of Section 217 (2A) of the Companies Act,
 1956 read with the Companies (Particulars of Employees) Rules 1975 as
 amended, there was no employee during the year drawing remuneration
 more than the stipulated amount in the said rules.
 
 Corporate Governance
 
 Pursuant to Clause 49 of the Listing Agreement with the Stock
 Exchanges, a detailed compliance report on Corporate Governance systems
 and practices together with a certificate from the statutory auditors
 confirming compliance with the conditions of corporate governance
 stipulated in the said clause is annexed to this report.
 
 The Board laid down a Code of Conduct for all Board members and
 senior management of the Company and the Code of Conduct has been
 posted on the website of the Company, www.dhanus.net.
 
 Acknowledgements
 
 Your Directors take this opportunity to place on record their sincere
 appreciation for the continued support and confidence reposed by the
 clients, business associates and the shareholders. The Directors also
 convey their appreciation to the employees at all levels for their
 enormous personal efforts as well as collective contribution.
 
                          For and on behalf of the Board of Directors 
 
 Place: Chennai            Capt. D.S. Srinivasan       A.D. Sudhindra
 
 Dated: August 18, 2012    Managing Director           Director