Dear Shareholders,
 
 It gives me pleasure to present the details of the performance of your
 Company for the Financial Year 2010 - 2011, which are more particularly
 described in the Annual Report, copy of which is enclosed.
 
 The results of the Company have not been as good as I would have liked
 them to have been. The turnover was Rs.276.76 crores during FY10/11 on
 a standalone basis, as compared to Rs.532.47 crores for the FY09/10;
 the profit was down by 52% to Rs. 22.42 crores and EPS was down by 54%
 to Rs. 13.90. The main reason for the Company''s poor performance this
 year was that despite the fact that the Company bid for several ONGC
 contracts competitively, it missed some of the major contracts by
 narrow margins. Major international offshore construction companies
 feeling the crunch of the international slow down resulting in limited
 work opportunities in their traditional areas, had cut their prices
 drastically to win major ONGC contracts. They cut prices to
 approximately 40% below ONGC''s budgeted expenditures so as to be able
 to enter the Indian market. They could afford to do this as they had
 owned assets that they could put to work with marginal returns. While
 the Company continued to be cost competitive in its areas of core
 competency, the high cost resources which the Company had to hire from
 outside for these green field projects negated this advantage. In order
 to be able to compete with these parties for the forthcoming projects
 and to be on a more equitable footing, your Company has planned to
 synergise its capabilities with other players having resources and
 capabilities, both Indian and international, that the Company lacks so
 as to bring together a more cost competitive front.
 
 At the same time, international oil activity has already shown signs of
 picking up. Saudi Arabia has set development plans in place to enhance
 their production output by close to 1 million tons of production and
 will spend close to 20 billion dollars in this activity alone. Abu
 Dhabi has scheduled development and ongoing expenditures of around 16
 billion dollars for their offshore fields and Qatar has plans to spend
 close to 18 billion dollars. The Company has been successful in getting
 prequalified by both Saudi Aramco and Ras Gas and has already submitted
 tenders to both these operators. ONGC continues with its development
 plans and the Company will be responding to ONGC for its more than 1
 billion dollars worth of tenders that the Company is qualified for,
 either on its own or in consortium with other parties. Your Board is
 confident that the worst is behind us and the future continues to be
 promising for the Company.
 
 The Company''s Board of Directors have recommended a dividend of
 Rs.1.50/- per share of Rs.10/- each subject to the approval of the
 shareholders.
 
 It gives me great pleasure to inform my fellow shareholders that work
 on the new construction barge, Vikrant Dolphin, to be owned by Dolphin
 Offshore Enterprises (Mauritius) Pvt. Ltd., is almost complete. The
 arrival of the new barge early next year, will add to your Company''s
 competitiveness significantly. Overall, we remain bullish about the
 future prospects of your Company. During March 2011, in spite of stiff
 competition from abroad, your Company has been awarded a contract from
 SCI for providing diving services on ONGC''s vessels Sevak and Prabha
 which is a one-year contract, with an option to extend up to 18 months.
 
 Your Company is also vigorously trying to get some projects abroad.
 Extension of Charter Hire of Seamec-1 for 2 years   1 year extension
 (optional) and the delivery of the above new barge will help your
 Company in participating bidding directly as main bidder / consortium
 partner or sub contractor for high value tenders.
 
 ONGC is likely to come up to Rs.4000 crores worth tenders on brown
 field job soon. Your Company has a competitive advantage in the brown
 field projects over the green field projects. The Company is conscious
 of the importance of being competitive in the present day market
 conditions and has taken several cost-cutting measures. I am confident
 that with these steps the company will soon resume its upward growth
 trend.
 
 Your Company has consistently adopted high standards of Corporate
 Governance. Good Corporate Governance is always part of the Company''s
 business philosophy. The effort of your Company is not only to comply
 with regulatory requirements but also practice Corporate Governance
 principles based on integrity, transparency and overall corporate
 accountability.
 
 I am grateful to the Board of Directors for their support and guidance
 and also to all customers, bankers, financial institutions, Government
 and regulatory authorities, shareholders and most of all to all the
 employees for their valuable support and co-operation.
 
 I look forward to your continued support, trust and participation in
 the growth of the Company.
 
                                                With warm regards,
 
                                        Rear Admiral Kirpal Singh 
 
                                               Executive Chairman