EIH

Ladies and Gentlemen,
 
 The global financial crisis and the terror attacks on india’s financial
 capital Mumbai, last November, have resulted in a sharp drop in foreign
 visitors to India. several countries issued travel advisories and most
 companies have curtailed travel. Consequently, the tourism industry is
 witnessing an unprecedented downturn. Hotel occupancies and revenues
 have been significantly affected and the travel and tourism industry is
 experiencing challenging times. the recent H1n1 pandemic could further
 restrict global travel.
 
 Current business trends are not encouraging. occupancies, average room
 rates and revenues continue to fall resulting in lower profitability.
 We should expect a revival in the Financial year 2010-2011.
 
 Though the future outlook may be grim, there are some positive signs.
 India now has a stable Government in new Delhi. i hope political
 compulsions will not stand in the way of more economic reforms. India
 and China are expected to lead the global economic recovery. India is
 seeing some key signs of recovery as the Government is projecting a 7%
 GDP growth in the current year. India is thus likely to recover faster
 than most other economies. the financial crisis in India may not be as
 severe and protracted as some had predicted. the Indian stock market
 has shown some recovery and is now considered by many as an attractive
 investment destination.
 
 The tourism Ministry has been pro-active and has offered several
 incentives to foreign travellers. the Ministry has declared 2009 as the
 Visit india” year.  the Government needs to do more as the employment
 and foreign exchange potential of the travel and tourism industry can
 help to create economic activity. it is unfortunate that the hotel
 industry has not been included in the infrastructure sector in the
 recent Budget.
 
 These are challenging times for the hospitality industry. it is often
 said that a crisis is also an opportunity and it is, therefore, the
 right time to be creative and innovative. it is also an opportunity to
 minimize waste without compromising on quality and service levels. i am
 confIdent that the many awards and accolades will continue to come our
 way.
 
 Our industry is undergoing unprecedented changes regardless of the
 economic environment. Customers, markets and technologies are changing
 rapidly. this is an unparalleled opportunity to remain committed and
 focused. We must be proactive to our customers’ needs. understanding
 our customers will allow us to stay competitive in a rapidly changing
 market.
 
 Last year, i had stated that we are committed to bring about
 technological changes so that our hotels follow high environment
 friendly practices.  We stand by this commitment.
 
 Terrorism is one of the biggest challenges of our times. the targeting
 of luxury hotels and their guests has significant implications for the
 hospitality industry. security has become a major priority for us. this
 not only adds an extra financial burden but also inconveniences our
 guests. these security measures are unavoidable in the present
 environment.
 
 We must hire and retain the best people in the industry. We need to
 ensure that performance is rewarded and loyalty recognized. i must
 express my appreciation to all those who work for the Oberoi Group. i
 thank them for their hard work, dedication and loyalty.
 
 I must pay tribute to the brave members of our staff who worked
 tirelessly to save many lives during the terrorist attack in November
 of last year.  i pay homage to our staff members, our guests and others
 who made the supreme sacrifice during this tragedy.
 
 In conclusion, i thank my colleagues on the Board for their invaluable
 support, advice and encouragement. i also thank all other stakeholders
 for their continued support.
 
 Thank you.
 
 P.R.S. Oberoi
 30th June, 2009