Info Edge India

The Directors have pleasure in presenting the Annual Report together
 with the audited statement of accounts for the year ended March 31,
 2008.
 
 FINANCIAL RESULTS
 
                                               (Figures in Rs. Million)
 
 Particulars                                      2007-08    2006-07
 
 Revenue
 
 Total sales                                    2,450.61     1,575.15
 
 Service tax                                      261.22       179.46
 
 Net sales                                      2,189.39     1,395.69
 
 Other income                                     207.25        75.94
 
 Total Income                                   2,396.64     1,471.63
 Expenditure
 
 Advertising and Promotion Cost                   481.24       300.38
 
 Administration and Other expenses*               255.75       171.92
 
 Personnel expenses                               746.28       492.36
 
 Network and other charges                         60.53        58.99
 
 Finance and bank charges                          11.19         6.97
 
 Depreciation                                      55.51        46.19
 
 Total expenditure                              1,610.50     1,076.81
 
 Net profit before tax                            786.14       394.82
 
 Net Profit after Tax                             554.87       270.67
 
 * Administrative expenses include traveling & conveyance; postage &
 telephone expenses; establishment expenses and other expenses
 
 FINANCIAL REVIEW
 
 Net Sales increased by 56.87% from Rs. 1,395.69 million in 2006-07 to
 Rs. 2,189.39 million in 2007-08. Other income increased by 172.91% to
 Rs. 207.25 million in 2007-08 on account of accretion in surplus funds
 as also IPO proceeds being available throughout the year. Consequently,
 total income increased by 62.86% from Rs. 1,471.63 million in 2006-07
 to Rs. 2,396.64 million in 2007-08.
 
 Total expenditure increased by 49.56% from Rs. 1,076.81 million in
 2006-07 to Rs. 1,610.50 million in 2007-08. Much of this increase was
 due to the growth in advertising and promotion costs, and employee
 costs. Advertising and promotion costs increased by 60.21% from Rs.
 300.38 million in 2006-07 to Rs. 481.24 million in 2007-08 as we
 invested more in Jeevansathi and 99 acres, while employee costs
 increased by 51.57% from Rs. 492.36 million in 2006-07 to Rs. 746.28
 million in 2007-08 on account of wage revision and manpower increase.
 
 Profit before tax increased by 99.11% from Rs. 394.82 million in
 2006-07 to Rs. 786.14 million in 2007-08 and profit after tax increased
 by 104.99% to Rs. 554.87 million in 2007-08.
 
 DIVIDEND
 
 Your Directors are pleased to recommended dividend at the rate of 7.5%
 (Re. 0.75 per share) for 2007-08, subject to the approval of the
 shareholders. The proposed dividend together with corporate dividend
 tax would mean an outflow of Rs. 23.95 million.
 
 OPERATIONS REVIEW
 
 We provide recruitment classifieds and related services through
 Naukri.com, Naukrigulf.com and Quadrangle business divisions.  This
 business generated around 90% of the company’s net sales in 2007-08. We
 also provide matrimonial and property related classifieds and related
 services through our Jeevansathi.com, 99 acres.com and
 Allcheckdeals.com divisions respectively. The combined contribution of
 these along with other divisions to the company’s net sales increased
 to 10% in 2007-08. During the year the company entered the domain of
 professional networking services through brijj.com and completed the
 spadework for launching its foray into online education through
 Shiksha.com.
 
 Leveraging the opportunities provided by a growing economy, the
 transformation of India into a younger country and the increase levels
 of internet penetration, your company continued to grow at a healthy
 rate, both in terms of the top-line reflected in total sales growing by
 56.9% and bottom-line reflected by more than doubling of profit after
 tax to Rs. 554.87 million.  Consequently basic earnings per share
 increased from Rs. 11.31 in 2006-07 to Rs. 20.33 in 2007-08.
 
 Detailed analysis of the performance of the Company and its businesses,
 including initiatives in the area of Human Resources, Information
 Technology, has been presented in the section on Management Discussion
 and Analysis of this Annual Report.
 
 FUTURE OUTLOOK
 
 We are cautiously optimistic of the future prospects of the company. We
 believe that the economy will continue to grow with a demographic
 pattern that suits our businesses. Internet penetration and usage will
 also increase and we, as a company now have the platform including
 human talent and industry experience to build on and create businesses
 in the online space that will help the Company maintain its growth
 pattern.
 
 SUBSIDIARY COMPANIES
 
 As of March 31, 2008, Info Edge has three wholly-owned subsidiary
 companies – Naukri Internet Services Private Limited, Jeevansathi
 Internet Services Private Limited and Info Edge (India) Mauritius
 Limited.
 
 Particulars of Employees
 
 We continued to grow rapidly in 2007-08. Recruiting quality talent has
 been a key focus for the HR team, and the Info Edge family has grown
 from around 1,250 as on March 31, 2007 to around 1,650 as on March 31,
 2008. Besides the different facet of recruitment, retention and
 development of talent, as discussed in the management discussion and
 analysis, an important HR initiative has been the successful
 implementation and stabilization of a robust Human Resource Information
 System that provides all kinds of reports and analysis at the click of
 a button and ensures that all details like personal records and
 employee history are easily accessible.  We have also focused on
 strengthening internal communication by continuing to publish and
 distribute an internal quarterly e-magazine “Inside Edge” which covers
 all major happenings in the Company, department or branch. Recently,
 the company launched “I-Blog” as an internal communication medium to
 connect Info Edgians across all locations.
 
 The particulars of employees required under Section 217 (2A) of the
 Companies Act, 1956 and the rules there under, are required to be
 annexed to this Report as Annexure. However, pursuant to the provisions
 of Section 219 (1)(b)(iv) of the Companies Act, 1956, the Annual Report
 and Accounts are being sent to all the shareholders of the Company
 without the above information. Any shareholder interested in obtaining
 such particulars may write to the Company.
 
 EMPLOYEES STOCK OPTION PLAN (ESOP)
 
 We had adopted ESOP scheme 2003 to include our employees in wealth
 sharing and in adopting a more retention oriented compensation program.
 As the Company was a private limited unlisted company at that time,
 therefore SEBI ESOP Guidelines were not applicable to our old ESOP
 scheme. However, with the listing of Company’s shares in November 2006,
 the Company introduced a new SEBI compliant ESOP scheme- ESOP 2007,
 which was approved by passing a special resolution in the
 Extra-ordinary General Meeting (EGM) held on March 26, 2007. The
 Company made fresh grants under the new scheme in financial year
 2007-08. The exercise of options would require issue of fresh capital
 to the ESOP Trust at appropriate times and would therefore utilize part
 of the limit of 818,857 new shares, being 3% of the issued and paid up
 share capital of the Company as on December 31, 2006 (which was
 27295256 shares of Rs. 10 each), already approved for the purpose by
 the Shareholders in their meeting held on March 26, 2007.
 
 The Company successfully obtained in-principle approval of National
 Stock Exchange of India Limited (NSE) and Bombay Stock Exchange Limited
 (BSE) on the new ESOP scheme in terms of the requirement of SEBI
 Employees Stock Option Scheme and Employee Stock Purchase Scheme
 Guidelines, 1999.
 
 Disclosures as required by Clause 12 of the SEBI Employees Stock Option
 Scheme and Employee Stock Purchase Scheme Guidelines, 1999 are annexed
 to this report.
 
 A certificate from M/s. Price Waterhouse, Chartered Accountants,
 Statutory Auditors, with regards to the implementation of the Company
 Employees’ Stock Option Schemes, would be placed before the
 shareholders in the next Annual General Meeting, and a copy of the same
 shall be available for inspection at the registered office of the
 Company.
 
 CORPORATE GOVERNANCE
 
 Separate detailed chapters on Corporate Governance Report, Additional
 Shareholder Information and Management Discussion and Analysis are
 attached herewith and form a part of this annual report.
 
 PUBLIC DEPOSITS AND LIQUIDITY
 
 We continue to be almost debt-free, and believe we maintain sufficient
 cash to meet our strategic objectives. During 2007- 08, your Company
 has not accepted any deposits or raised any fresh equity from the
 public.
 
 ENERGY CONSERVATION, TECHNOLOGY ADOPTION AND FOREIGN EXCHANGE FLOWS
 
 Since the Company is a service sector company and does not own any
 manufacturing facility, the other particulars in the Companies
 (Disclosure of Particulars in the Report of the Board of Directors)
 Rules, 1998 are not applicable. However, on a proactive basis, we are
 disclosing the details of energy conservation and Reserach and
 Development as part of annexure-I to the directors’ report. The
 particulars regarding foreign exchange earnings and expenditure are
 furnished below
 
 (Figures in Rs. million) 
 
                                          2007-08      2006-07
 
 Foreign Exchange Earnings
 
 Sales                                   215.56         138.03
 
 Total Inflow                            215.56         138.03
 
 Foreign Exchange Outgo
 
 Travel Expenses                           1.91           1.34
 
 Server Charges                           36.62          38.86
 
 Advertising, Promotion and
 
 Marketing Expenses                       16.53          35.33
 
 IPO related expenses                       -            10.96
 
 Foreign Branch Expenses                  15.00           0.52
 
 Others                                    7.16           3.04
 
 Total Outflow                            77.22          90.05
 
 Net Foreign Exchange Flow               138.34          47.98
 
 LISTING OF SHARES
 
 The Company’s shares are listed on Bombay Stock Exchange Ltd. (BSE) &
 National Stock Exchange of India Ltd. (NSE) with effect from November
 21, 2006, post its initial public offering (IPO).
 
 DIRECTORS
 
 During the year, the Board of Directors had appointed Dr. Naresh Gupta,
 as Additional Director w.e.f. October 29, 2007. Pursuant to Section 260
 of the Companies Act, 1956 he holds office upto the forthcoming Annual
 General Meeting, where the Members would confirm his appointment as
 Director of the Company.
 
 As per the requirements of Section 256 of the Companies Act, 1956,
 two-third of the Board shall consist of retiring directors out of which
 one third shall retire at every Annual General Meeting. Accordingly,
 Mr. Arun Duggal, Mr. Saurabh Srivastava and Mr. Ashish Gupta, retire by
 rotation as Directors at the ensuing Annual General Meeting and are
 eligible for re- appointment.
 
 INTERNAL CONTROL SYSTEMS
 
 The Company has in place adequate systems of Internal Control to ensure
 compliance with policies and procedures. Internal Audits of all the
 units of the Company are regularly carried out to review the internal
 control systems. The Internal Audit Reports along with implementation
 and recommendations contained therein are constantly reviewed by the
 Audit Committee of the Board.
 
 AUDITORS
 
 M/s. Price Waterhouse, Chartered Accountants hold office until the
 conclusion of forthcoming Annual General Meeting and being eligible
 offer themselves for re-appointment.
 
 DIRECTORS’ RESPONSIBILITY STATEMENT
 
 The Directors confirm that:
 
 > in the preparation of the annual accounts, the applicable accounting
 standards have been followed;
 
 > they have selected such accounting policies and applied them
 consistently and made judgments and estimates that are reasonable and
 prudent, so as to give a true and fair view of the state of affairs of
 the Company at the end of the financial year and of the profits of the
 Company for the year;
 
 > they have taken proper and sufficient care for the maintenance of
 adequate accounting records in accordance with the provisions of the
 Companies Act, 1956, for safeguarding the assets of the Company and for
 preventing and detecting fraud and other irregularities; and
 
 > they have prepared the annual accounts on a going concern basis.
 
 NOTES TO ACCOUNTS
 
 The observation of auditors and notes on accounts are self explanatory.
 
 ACKNOWLEDGMENTS
 
 We thank our clients, vendors, investors and bankers for their
 continued support during the year. We place on record our appreciation
 of the contribution made by employees at all levels.  Our consistent
 growth has been made possible by their hard work, solidarity,
 cooperation and support
 
 For and on behalf of the Board
 
 Date : June 25, 2008                      Kapil Kapoor
 Place: Hong Kong                          Chairman