There was wide expectation that global economies would see a recovery
 in 2011.  Unfortunately, this is not likely to happen. Global economies
 and the economic environment remain uncertain and volatile. the world
 has also been confronted with socio-political developments which could
 have serious consequences for all of us.
 
 In recent months several countries in North africa and the Middle east
 have seen social and political unrest. tunisia and egypt have seen
 profound changes in their political systems. People in several other
 countries in the region are seeking major changes in their political
 systems; they are demanding an end to decades old dictatorships.
 
 Japan is struggling with the aftermath of the earthquake and the
 subsequent Tsunami. It is too early to predict how this natural
 calamity will affect global markets.
 
 Considering the events stated above, we are beset with uncertainty and
 volatility.  In these circumstances we need to take steps to strengthen
 the Companys capacity to withstand such shocks. we must exercise
 caution in evaluating business opportunities.
 
 India also faces several challenges. the Government has not been able
 to curb infation. Increase in interest rates are hampering industrial
 production and the recent scandals do not auger well for foreign direct
 investment.
 
 It is unfortunate that the potential of Indias travel and tourism
 industry has not been fully recognised. at a time when the countrys
 balance of payments position is a matter of concern, it is all the more
 important that the Government gives due importance to the travel and
 tourism industry which earned US$ 14.19 billion in the year 2010.
 Regrettably, the employment potential of the industry has not been
 fully tapped. the travel and tourism industry presently employs 25
 million people directly and an equal number indirectly which could grow
 exponentially if India gets its fair share of foreign travellers. China
 gets 50 million foreign visitors whereas we get a mere 5 million!
 
 Many international hospitality brands are establishing their presence
 in India. this trend will undoubtedly increase competition for us. as I
 have always maintained, healthy competition is welcome and will
 encourage us to raise our standards further and dedicate us to service
 excellence.
 
 the oberoi Group continues to be recognised internationally by
 travellers as being amongst the best hospitality groups worldwide. the
 numerous awards and accolades conferred upon many of our hotels are due
 to the dedication of our staff who continue to provide our guests with
 exceptional service. this is a source of pride and satisfaction for us.
 
 though there has been some improvements in infrastructure, much more
 needs to be done. Infrastructure is the key to our economic
 development. we need more power, potable water, roads and more airports
 planned and built on international standards.
 
 It is widely recognised that we are not doing enough in our urban
 centres.  as per a recent McKinsey Report on urbanisation, there will
 be many more sizeable urban centres in India over the next two decades.
 as a result, infrastructure in our present and future urban centres
 will become more taxed. our policy makers need to address this problem
 on a war footing.
 
 I thank my colleagues on the Board for their continued support and
 guidance.  I am grateful to our Shareholders for the Companys
 successful Rights Issue.
 
 In conclusion, I thank all our employees and other stakeholders for
 their support.
 
 thank you.
 
 P.R.S. oberoi
 
 Chairman
 
 15th June, 2011