THE BHAGVAD GITA HAS A GUIDING VERSE, WHICH TRANSLATES THUS: THE WORLD
 CONSISTS OF PAIRS OF OPPOSITES LIKE PROFIT AND LOSS, HEAT AND COLD, JOY
 AND SORROW AND HONOUR AND DISHONOUR. IT IS UNPREDICTABLE. IT IS
 CONSTANTLY CHANGING AND IS IMPERMANENT. ENDURE THESE FLUCTUATIONS.  ONE
 WHO IS NOT TROUBLED BY THEM, IS BALANCED IN JOY AND SORROW, AND IS
 STEADY, IS FIT FOR EXCELLENCE. LOOKING BACK AT 2010-11, I MUST ADMIT
 THERE WERE CHALLENGES. THIS MADE US LOOK BEYOND. WE REMAINED
 UNPERTURBED, STRIVED HARD FOR ''EXCELLENCE'', AND SUCCEEDED.
 
 On 1 September 2010, the Insurance Regulatory and Development Authority
 (IRDA) mandated significant, industry re-defining regulatory changes.
 It was like being hit by a dozen tornadoes and typhoons at the same
 time. The chapter on Management Discussion and Analysis explains the
 sea changes that the IRDA has brought about in the life insurance
 industry. Max New York Life (MNYL) had to anticipate and react very
 quickly to these changes. Which it did admirably - and often beyond the
 call of duty. It swiftly rallied forces, re-configured its businesses
 and priorities and moved on to profitable growth. I dare say that it
 was one of the very few private sector life insurance players that
 could weather a regulatory storm that was as profound as it was far
 reaching.
 
 Consider the facts. Notwithstanding being buffeted by that life-
 threatening storm, MNYL''s total revenue (first year premium plus
 renewals) grew by 20% to Rs.5,813 crore; its market share among private
 players based on adjusted first year premium went up by 200 basis
 points to 7.5%; its cost ratio improved from 42% to 38%, due to
 stringent cost management initiatives; its assets under management grew
 by 37% to Rs.13,836 crore; it maintained more than double the
 stipulated solvency margin; its profit after tax grew more than 12
 times to Rs.283 crore; and it generated shareholders'' profit of Rs.194
 crore in 2010-11 compared to a loss of Rs.21 crore in 2009-10.
 
 I must put on record my sincere appreciation to the core MNYL team, to
 its Vice Chairman, Anuroop (Tony) Singh, to key resources from your
 Company, to an excellent, focused, rapid action facilitating team from
 McKinsey & Company and to one of my gurus and mentors, Ram Charan, for
 effecting such a fundamental turnaround under some of the most dire
 external circumstances.
 
 May we not have any more unsettling changes such as the one we
 witnessed in September 2010. And may MNYL now be poised for
 consistently focused, profitable, value enhancing growth — as the
 preliminary evidence suggests it is.
 
 Compared to the changes that hit the insurance industry, the rest of
 your Company''s business looked like plain sailing.
 
 Max Healthcare is on a profitable growth path. With the new blocks at
 Patparganj and Saket getting fully operational, the average number of
 operational hospital beds increased by 23% from 751 in 2009-10 to 926
 in 2010-11. Today, a network of six top class hospitals and two
 speciality medical centres in Delhi and the National Capital Region
 (NCR) is serviced by around 1,250 doctors, 1,725 nurses and 1,840
 para-medical and other staff. The registered patient base now runs at
 over 11.4 lakh patients. There are over 2.5 lakh patient transactions
 per month.
 
 Its revenue across its network of hospitals and medical centres grew by
 29% to Rs.685 crore in 2010-11. EBIDTA more than doubled to Rs.52 crore
 in 2010-11.
 
 More significantly, the EBIDTA margin rose by 320 basis points — from
 4.4% in 2009-10 to 7.6% in 2010-11.
 
 Max Healthcare will be raising its capacity to 1,900 beds by FY 2012
 by.  not only increasing beds in Delhi and the NCR but also by
 commissioning I more hospitals in North India. You will soon see a new
 super speciality hospital in Shalimar Bagh (New Delhi); in Dehradun
 (Uttaranchal) and in Bhatinda and Mohali as a public-private
 partnership with the Government of Punjab. You should also expect to
 see Max Healthcare earning profits on a sustained basis while
 delivering superior patient care across several therapeutic areas.
 
 Max Bupa, your Company''s joint venture with Bupa Plc, UK focuses on
 providing excellent health insurance services. It is a new venture, and
 2010-11 was its first full year of operations. Properly priced and
 well- serviced health insurance is new to India — where the few who got
 insured typically did so through low priced, loss-making public sector
 health insurance policies. Thus, while there is considerable demand for
 such insurance, I expect that it will take a few years for the business
 to gain sufficient traction; and somewhat longer to deliver profits.
 Even so, I have been impressed by Max Bupa''s performance. At the end of
 its first full year of operations, it had covered a total of 46,000
 lives during 2010-11; it earned a gross written premium of over Rs.25
 crore; and built multi-channel provider networks and associations with
 hospitals. I hope that the business continues growing smartly with an
 eye on quality growth, high service benchmarks and profits.
 
 Max Neeman, your Company''s calibrated foray into clinical research for
 global pharmaceutical companies is bearing fruit. Though a small
 relative to MNYL and Max Healthcare and in a very early stage of
 development, Max Neeman has a client base of 77 global pharmaceutical
 entities — having increased it by 20 in 2010-11. I expect growth from
 this dual-shored operation.
 
 Max Speciality Films (MSF), your Company''s Bi-axially Oriented
 Polypropylene (BOPP) film and metallising facility in Punjab has
 continued doing well. MSF''s sales turnover was Rs.456 crore in 2010-11
 against Rs.363 crore in 2009-10. Net revenues increased by 25% from
 Rs.333 crore in 2009-10 to Rs.417 crore in 2010-11. Despite a 22%
 increase in overall industry capacity, MSF''s operating margin (EBIDTA
 to net sales) was maintained at 11.7% in 2010-11, which is very
 creditable in this industry EBIDTA increased by 23% to Rs.53 crore in
 2010-11 and PBT increased by 77% to Rs.36 crore.
 
 In the aggregate, therefore, your Company has grown in the midst of a
 rapidly changing environment. Consolidated operating revenue increased
 by 20% to Rs.6,668 crore in 2010-11. It has also turned around:
 consolidated profit before tax was Rs.32 crore in 2010-11 versus a loss
 of Rs.86 crore in 2009-10.  On a consolidated basis, net profit was
 Rs.9 crore in 2010-11 compared to a net loss of Rs.72 crore in 2009-10.
 And the treasury corpus was Rs.540 crore as on 31 March 2011.
 
 From the above, it is truly visible that Max India Group is on a
 sustainable and profitable growth trajectory. Over the last two years,
 the initiative of putting in place an effective Board governed style of
 working has strengthened the result orientation of our key businesses,
 including emphasis on outcome based performance and risk management.
 
 However, we continue to live in challenging and complex times, with
 increasing competition, pressure on profitability, and our commitment
 to excellence is the key to future success and profitable growth. To
 strengthen the leadership of your Company, I recently took a decision
 to step down from the day to day role in my capacity as Managing
 Director of your Company.  Rahul Khosla was appointed by your Board as
 the future Managing Director of your company on June 8th and will
 formally be instated as Managing Director on August 18, 2011.
 
 Rahul brings with him value based leadership, high energy and rich
 experience having held key positions in American Express Bank, Bank of
 America, ANZ Grindlays Bank, Standard Chartered and lastly Visa in
 Singapore.
 
 Please join me in welcoming and wishing Rahul the very best for his
 success in his role as Managing Director of your company.
 
 I will continue to serve as Executive Chairman of your company as well
 as Chairman of its subsidiaries, Max New York Life Insurance, Max
 Healthcare and Max Bupa.
 
 I wish to sincerely thanks my partners, New York Life Insurance,
 U.S.A., Bupa, UK; all the Directors who painstakingly work, heading
 various Sub-Committees of Boards, my Vice Chairman Anuroop (Tony) Singh
 and the leadership teams of your company and the overall Max India
 Group.
 
 I look forward to an exciting year ahead and hope that we are able to
 continue navigating the impermanency, in our quest for excellence and
 profitable growth.
 
 Analjit Singh
 
 Chairman