EIH

The Board presents the Fifty-eighth Annual Report together with the
 Audited Statement of Accounts and the Auditors Report in respect of
 the year ended 31st March, 2008.
 
 The financial highlights are set out below:
 
                                             Rupees         in millions 
                                           2007-2008         2006-2007
 
 Total Revenue                             11,511.17          9,951.96
 Earnings before Interest, Depreciation,
 Taxes, Amortisations, Exceptional and
 Extraordinary Items (EBIDTA)               4,803.56          3,963.00
 Interest and Finance Charges                 749.53            980.76
 Depreciation                                 453.31            426.91
 Exceptional Income/(Expenditure)             (34.03)            15.28
 Other Amortisations                           68.25             64.00
 Profit before tax                          3,498.44          2,506.61
 Current tax                                1,214.83          1,000.09
 Deferred tax                                  75.23           (102.75)
 Fringe Benefit tax                            36.13             33.81
 Profit after tax                           2,172.25          1,575.46
 Extraordinary Income (net of tax)              Nil             428.06
 Dividend                                     707.32            550.14
 Dividend tax                                 120.21             93.50
 Transfer to General Reserve                  750.00            500.00
 Balance carried over                       2,494.02          1,899.30
 
 The process of amalgamation of the Companys wholly owned subsidiary,
 Rajgarh Palace Hotel and Resorts Limited, was completed during the
 Financial Year. The amalgamation was effective 1st April, 2005. The
 Financial Statements of Rajgarh Palace Hotel and Resorts Limited have
 been incorporated in the Accounts.
 
 In accordance with the provisions of Section 217 (2AA) of the Companies
 Act, 1956 (the Act) and, based upon representations from the
 Management, the Board states that:
 
 a) in preparing the Annual Accounts, applicable Accounting Standards
 have been followed and there are no material departures;
 
 b) the Directors have selected such accounting policies, applied them
 consistently and made judgments and estimates that are reasonable and
 prudent to give a true and fair view of the state of affairs of the
 Company as at the end of the Financial Year and of the Profit of the
 Company for that period;
 
 c) the Directors have taken proper and sufficient care, to the best of
 their knowledge and ability, for the maintenance of adequate accounting
 records in accordance with the provisions of the Act and for
 safeguarding the assets of the Company and for preventing and detecting
 fraud and other irregularities;
 
 d) the Directors have prepared the Annual Accounts of the Company on a
 going concern basis.
 
 The annexed Management Discussion and Analysis forms a part of this
 Report and covers, amongst other matters, the performance of the
 Company during the Financial Year as well as future prospects.
 
 In accordance with the Listing Agreement with the Stock Exchanges the
 following are attached:
 
 1.  Consolidated Financial Statements prepared as per the Companies
 (Accounting Standards) Rules, 2006 along with the Auditors Report. The
 financial results of Mashobra Resort Limited have been consolidated
 based on unaudited Annual Financial Statements.
 
 2.  The Report on Corporate Governance in accordance with Clause 49 of
 the Listing Agreement along with the Auditors Certificate.
 
 The Board recommends a Dividend of Rs. 1.80 (90%) per Equity Share in
 respect of the Financial Year. The Dividend, if approved at the
 forthcoming Annual General Meeting, will be paid to those Shareholders
 whose names appear in the Register of Members of the Company on close
 of business on 28th July, 2008. As per the provisions of the Income Tax
 Act, 1961, the tax on Dividend will be borne by the Company.
 
 Energy conservation measures taken during the Financial Year include
 installation of high efficiency enthalpy wheels, chillers, pumps and
 drives, high performance glass for fenestration,modernisation of
 elevators, solar water heating systems, energy efficient lighting and
 lighting control gear. Improvements in thermal insulation and metering
 have also been carried out. Energy conservation measures begun in the
 above areas will be continued during the current Financial Year.
 
 The Company also has plans to install energy efficient transformers,
 energy savers for lighting circuits and installation of more efficient
 Sewage Treatment Plants. The above steps are expected to be further
 supplemented by measures identified through energy audits that are
 being carried out in the Company.
 
 During the Financial Year, the Foreign Exchange earnings of the Company
 amounted to Rs. 5,973.21 million as against Rs. 5,258.56 million in the
 previous year. The expenditure in Foreign Exchange during the Financial
 Year was Rs. 2,338.51 million as against Rs. 1,488.11 million in the
 previous year.
 
 Mr. Christopher Reeves, a Director of the Company, passed away on 20th
 November, 2007. The Board wishes to place on record its appreciation
 and gratitude for Mr. Reevess invaluable contribution during his
 association as a Director of the Company.
 
 Mr. L. Ganesh was inducted as a Director in the casual vacancy of Mr.
 Reeves effective 30th January, 2008. Mr. Reeves would have retired by
 rotation at the forthcoming Annual General Meeting. Accordingly, Mr.
 Ganesh will retire by rotation at this Annual General Meeting. He is
 eligible for re-appointment. The required Notice under Section 257 of
 the Act, together with the requisite deposit, has been received from a
 Shareholder proposing Mr. Ganesh as a Director of the Company.
 
 Mr. Rajan Raheja is due to retire by rotation at the forthcoming Annual
 General Meeting and is eligible for re-appointment.
 
 Approval has been received from the Central Government under Section
 212(8) of the Act exempting the Company from attaching copies of the
 Reports and Accounts of its Subsidiary Companies. Accordingly, the
 Reports and Accounts of the Subsidiary Companies have not been attached
 to this Report. In granting the exemption, the Central Government has
 directed that specified information pertaining to each Subsidiary
 Company be separately disclosed as a part of the Consolidated Financial
 Statements. This information has been incorporated on page 96 of this
 Report. Information relating to Mashobra Resort Limited is based on its
 unaudited Annual Financial Statements.
 
 Subject to prior arrangement, the Audited Annual Accounts of the
 Subsidiary Companies will be available for inspection by any
 Shareholder at the Companys Registered Office.  Shareholders
 interested in obtaining a copy of the Audited Annual Accounts of the
 Subsidiary Companies can write to the Company Secretary at the
 Registered Office.
 
 The Auditors of the Company, Messrs. Ray and Ray, Chartered
 Accountants, retire and are eligible for re-appointment.
 
 The information required under Section 217(2A) of the Act together with
 the Companies (Particulars of Employees) Rules, 1975, forms a part of
 this Report. However, as per the provisions of Section 219(l)(b) of the
 Act, the Report and Accounts that are being circulated to Shareholders
 do not include the Statement of Particulars of Employees under Section
 217(2A) of the Act. Any Shareholder interested in obtaining a copy of
 the above Statement may write to the Company Secretary at the
 Registered Office of the Company.
 
 The Board takes this opportunity to thank all employees for their
 commitment, dedication and co-operation.
 
                                        For and on behalf of the Board
 
 New Delhi                          S. S. MUKHERJI      P. R. S. OBEROI
 20th June, 2008             Vice Chairman Chairman and Chief Executive