This is the second annual report of your Company since its successful
 IPO in July 2009, and my second letter to you as the Chairman.
 
 Let me start by sharing with you some facts about Mahindra Holidays.
 
 - At the end of 2004-05, your Company had 28,491 vacation owners in
 its fold. On 31 March 2011, the membership stood at 125,169. That
 translates to a 25 per cent compound annual growth rate (CAGR) over six
 years — a creditable achievement by any yardstick.
 
 - Six years ago, your Company had one product — vacation ownership
 under Club Mahindra Holidays. Today, while Club Mahindra Holidays
 continues to dominate, it has various other products and offerings such
 as Zest, Club Mahindra Fundays, Mahindra Homestays, clubmahindra.travel
 and the newly launched rugged camping vacations called terra. Each
 provides differentiated offerings for various types of clients.  And
 each has a high growth potential.
 
 - Today, your Company has a selection of 35 resorts across hill
 stations, beaches, backwaters, wildlife, forts and heritage, as well as
 international destinations. In addition, Mahindra Homestays provides
 the experiences of authentic India by guests living in carefully vetted
 Indian homes — ranging from palaces and heritage properties, to
 plantations as well as rural and farm homes. On 31 March 2011, Mahindra
 Homestays was affiliated with 282 homes comprising 750 rooms across 60
 locations in India.
 
 I could go on. The point of these examples is to illustrate the
 phenomenal growth and goodwill that your Company has enjoyed over the
 last six years. Simply put, we have understood the needs of an
 increasingly better off set of consumers who desire to have vacation
 experiences with a difference; and, in the process, we have grown the
 business in different directions through attractive offerings; all
 united by the power of the Mahindra brand — a name associated with
 trust, credibility and transparency.
 
 Rapid growth, such as what has been witnessed by your Company,
 occasionally requires review and consolidation, lest it unwittingly
 gets out of hand. In the first half of 2010-11, the senior management
 of Mahindra Holidays asked a simple question: What are the
 improvements that we must do today so that Mahindra Holidays is even
 better prepared to benefit from future market opportunities?
 
 This led your Company to initiate measures to further improve
 productivity and create an even stronger foundation for growth.  There
 were several initiatives. Let me name a few.
 
 The first involved strengthening the process of customer acquisition,
 so as to build a more robust customer portfolio. The second was to
 standardise and further upgrade the quality and processes of customer
 interface — from the point of initial contact to sales to member
 relations and resort service. The third was to implement processes
 based upon best in class TQM principles across the organisation. The
 fourth was to further focus on building a seamless, enterprise-wide
 information technology backbone to handle exponential growth in volumes
 while increasing customer satisfaction.
 
 Thus, the tasks for driving the next phase of growth were to build a
 more robust customer base; standardise and improve all customer facing
 experiences; make quality the watchword of the organisation; and create
 a world class IT system to facilitate all aspects of the business.
 
 It was time to pause; to re-focus on the key drivers; to create an
 unmatched customer experience; and move on to the next phase of growth.
 
 These initiatives were identified and put in place in the first half of
 2010-11. While they put a pause on growth and somewhat dampened your
 Companys financial results, I have no doubts that Mahindra Holidays is
 again getting itself into a position to rapidly and profitably leverage
 the growth opportunities in Indias leisure hospitality market.
 
 As a Chairman of a listed Company, I am expected to be circumspect
 about forward-looking statements. Nevertheless, I believe that the
 next year should see a significant growth in room inventory. Moreover,
 I expect the management to achieve its improved quality and
 productivity goals. If these were to occur, one should presume that
 your Company ought to generate higher shareholder value along with
 higher revenue growth. I am, therefore, optimistic of the foreseeable
 future.
 
 In January 2011, the Mahindra Group launched a new brand positioning
 spanning all industries, companies, and geographies.  It is expressed
 by the word Rise. I am sure that you have seen this in various
 advertisement and media releases. Rise articulates a core group
 purpose: We will challenge conventional thinking and innovatively use
 all our resources to drive positive change in the lives of our
 stakeholders and communities across the world, to enable them to Rise.
 
 Mahindra Holidays, too, shall Rise. We will keep raising the bar;
 re-define and expand opportunities; innovate products and processes for
 the customers; and drive change, not just through greater shareholder
 value but by bettering the environment and the lives of our
 communities.
 
 Thank you for your support. We treasure it.
 
 With regards
 
 A K Nanda
 Chairman