Electrotherm (India)

2008-09 was an important year in our Companys evolution and growth as
 it comprehensively tested our will to survive, succeed and flourish in
 the midst of an economic meltdown. The financial crisis that brought
 back the painful memories of the Great Depression of the 1930s,
 affected the Indian economy as well. Electrotherm was no island in this
 crisis.
 
 Your company has achieved a turnover of Rs. 16828 million registering a
 growth of 27% over previous year. We have seen significant growth in
 international revenues in the engineering division and a healthy
 increase in our domestic sales inspite of the slowdown in the economy.
 However, net profit declined by 18% compared to previous year primarily
 on account of unprecedented volatility in commodity prices.
 
 Even though the demand outlook in emerging market economies in terms of
 investment in new steel plants is not very optimistic, we expect to
 continue to increase our export revenues in the next financial year for
 the engineering division. As a significant global provider of Induction
 Furnace, we continue to play defining role in creating demand in the
 markets that we operate in and continue to focus on increasing our
 international footprint.
 
 The Indian government has given stimulus packages to improve the steel
 demand which mainly depends on the infrastructure spending throughout
 the country. We are looking forward to a much healthier demand for our
 steel products and Ductile Iron Pipes with this kind of initiatives
 from the government.
 
 In-house research, product development and advancement of our
 intellectual property portfolio remain high priority areas for the
 company. The company has developed a high power/speed electric scooter
 most suitable for the Indian requirements. This is the first of its
 kind to be developed in India. We expect to increase our market share
 once we launch this product in the market.
 
 Your company is taking strict measures to prune costs where ever
 possible. The company has also engaged ECS consulting for the steel
 division to help improve operating efficiencies and reduce costs.
 
 We are proud of the knowledge and intellectual capital that our young
 professional workforce brings to the organization. Our people are at
 the centre of our technology and operations and the successes that I
 have been able to report are due to the outstanding commitment and
 contribution of our employees. It is because of them that we have come
 a long way in a short time. On behalf of the Board I am thankful to all
 of them for their continuing support and efforts.
 
 We have always found that challenging times present opportunities for
 us if we continue to realign our strategies with the changing market
 needs, strive relentlessly, constantly improve our offerings for the
 markets and allow minds to reach beyond conventional and predictable
 solutions. We are confident that we possess the competitive position to
 make our success sustainable in the coming years.
 
 We take this opportunity to thank our bankers, shareholders and
 investors for their confidence in the Company.
 
                                        MUKESH BHANDARI
 
                                CHAIRMAN & CHIEF TECHNOLOGY OFFICER