Gammon India

Dear Shareholder
 
 It is my pleasure to once again share my thoughts on the year gone by
 and ou r aspirations for the future. During the year 2008-09, the
 Global Economy witnessed a significant slowdown and liquidity crunch,
 triggering off fears of a prolonged recession. It was therefore no
 surprise that the capital markets across the world experienced a severe
 meltdown, significantly eroding the market capitalization of most
 companies.  Thankfully, the worst appears to be now behind us and we
 are all looking forward to the years ahead, with renewed hope and
 commitment.
 
 Even as the situation on the business front continued to be difficult,
 we used the year to consolidate ourselves and prepare for the
 opportunities that would arise in the future. As part of this strategy,
 we merged Associated Transrail Structures Limited (ATSL) with Gammon
 India Limited (GIL). We believe that with this merger, we will be able
 to better leverage and exploit the synergies of the two Companies. ATSL
 is amongst the top five companies in the business of Power Transmission
 & Erection. We believe that this merger will provide the much needed
 capital and strength to ATSL to expand its business, even as it fits in
 with our consolidation strategy to become an all-round infrastructure
 player.
 
 Along the same lines and with a view to providing a fillip to our Power
 Sector ambitions, we acquired significant interest in International
 Companies, all based out of Europe. The Company has invested about Euro
 100 million for these acquisitions, making them the largest investments
 done by us in our history. It would require significant management,
 time and effort to integrate the operations of the new Companies and
 for us to commercially exploit their intrinsic values. I believe the
 Shareholders should start reaping the benefits from these investments
 in about 2 to 3 years time. As a consequence of these acquisitions,
 the consolidated income of the Group crossed the Billion Dollar Mark
 and stood at Rs. 5220 crore, while the Net Asset Block amounted to Rs.
 4000 crore.
 
 I am also proud to inform you that Gammon Infrastructure Private
 Limited (GIPL), our Subsidiary Company incorporated in 2001, was
 successfully listed on NSE and BSE in April 2008. It is a matter of
 great satisfaction that even as the Parent Company is listed on the
 bourses and operates in the Engineering, Procurement and Construction
 space, its Subsidiary Company is also listed and operating as
 Infrastructure Developer.
 
 We believe that while computing our share price, the Stock Markets have
 not fully factored in on the underlying value of our investments in
 GIPL. Given the huge investments planned in the infrastructure sector,
 especially in Power Sector and National Highways, we are uniquely
 positioned to exploit the opportunities. Moving forward in the next two
 years, the Company is well positioned for a rapid growth, considering
 that all its business verticals have a strong order book position.  The
 contracting and power transmission business has orders worth Rs.12,000
 crore, while power equipment business has orders close to Rs.6,000
 crore. The committed growth outlay towards projects secured by our
 listed Subsidiary, GIPL, has another Rs.9,000 crore of business in
 hand.
 
 I take this opportunity to re-dedicate ourselves to the task of
 designing and building world-class infrastructure facilities as
 Builders to the Nation. In the process we are sure to add value to
 our shareholders, even as we seek to share the benefits amongst you and
 our employees. We are determined to make Gammon one of the Most
 Respected Companies in the Construction, Engineering and Infrastructure
 Development space.
 
 Before concluding, I place on record my deep appreciation and gratitude
 to all the Shareholders, Banks, Financial Institutions, our various
 Partners in development and execution (whether it be Suppliers,
 Vendors, Service Providers or Subcontractors) and of course the
 families of our Gammon Knights, who have stood by us in our long
 journey and whose continuing support we seek for the march ahead. May
 the journey be mutually rewarding and enriching.
 
                                                  Abhijit Rajan 
                                   Chairman & Managing Director