NIIT

The Directors take pleasure in presenting the 25th Annual Report along
 with the audited statement of accounts for the financial year ended
 March 31, 2008.
 
 Financial Results
 
 The highlights of your Companys financial results for the financial
 year April 1, 2007 to March 31, 200 are as follows:
 
                                                             (Rs. Mn.)
 
 Particulars                    NIIT Limited Group       NIIT Limited
                                Consolidated               Standalone
                               2007-08  2006-07       2007-08 2006-07
 
 Net Sales (Income              10,068    7,951       4,674     3,903
 from operations)
 
 Other Income                       73       61         301       105
 
 Total Income                   10,141    8,012       4,975     4,008
 
 Total Expenditure               9,211    7,293       4,185     3,375
 
 Profit before                     930      719         790       633
 
 depreciation and taxes
 Depreciation                      529      473         358       314
 
 Net tax provision                 (21)       4         104       (10)
 
 Net Profit                        422      242         328       329
 
 Basic EPS (Rs.)                  4.67     3.94        2.02      2.26
 
 Diluted EPS (Rs.)                4.65     3.74        2.02      2.18
 
 Your Companys consolidated net revenues for the year under review is
 Rs. 10,068 million as against Rs.  7,951 million in the previous year,
 registering a growth of 26.63 % and Profit after tax (after associate
 profit) surge from Rs. 573 million to Rs. 756 million, refecting a
 growth of 31.94 % on year to year basis.
 
 Your Companys total income from operations for the year under review
 is Rs. 4,674 million as against Rs.  3,903 million for the previous
 year, while the net profit is Rs. 328 million as against Rs. 329
 million in the previous year.
 
 Business Operations
 
 During the year under review, your Company continued to grow, based on
 its stated strategy set which focused around:
 
 Accelerated growth;
 
 Improved profitability; and
 
 Market leadership.
 
 During the year under review, your Company has launched various new
 programmes in partnership with Adobe, Cisco, Sun Microsystems, CompTIA,
 Microsoft, EMC and others, and also expanded its product portfolio,
 infrastructure and technology across the centres.
 
 Your Company has received orders for providing IT education in schools
 from the States of Bihar, Maharashtra, Tripura, Meghalaya and Kerala,
 besides renewal of existing contracts from the States of Andhra Pradesh
 and Himachal Pradesh.
 
 The new businesses i.e. IFBI and NIIT Imperia launched in the previous
 year gained momentum and received excellent response from the
 respective Industry. During the year in addition to the ICICI bank,
 IFBI partnered with HDFC Bank, KotakMahindra Bank, Yes Bank, ICICI
 Securities, ICICI Prudential and ICICI Lombard. NIIT mperia, in
 addition to IIM Ahmedabad and Kolkata tied-up with IMTGhaziabad, Indian
 Institute of Foreign Trade and IIM Lucknow. NIITs strategic alliance
 with Educational Testing Service (ETS) the worlds leading educational
 measurement and research organization, will allow NIIT Litmus to offer
 ETSs TOEIC (Test of English for International Communication) in India.
 
 Your Company maintained its number one position in IT training (as per
 Data Quest ranking) and continued to figure in the Top 20 IT training
 companies listing, as well as in the ranking of Top 20 Companies in the
 Training Outsourcing Industry on a worldwide assessment.
 
 Future Plans
 
 Based on the successful transition from an IT and IT enabled training
 company to training in other domain areas, your Company has also
 embarked on a plan to achieve leadership in global talent arena. This
 would imply increasing both depth and coverage to service the growing
 need of the services lead economy. This would be achieved through
 building strategic alliances with market leaders in each domain. It
 will further leverage the core competencies of the Company in pedagogy,
 technology and geographic reach.
 
 Your Company will continue to strengthen its presence in each of its
 businesses with a clear focused approach which would help increase
 revenue growth, improve profitability as well as de-risk the Company
 from economic slowdowns and currency fuctuations.
 
 Bonus Shares
 
 During the year under review, your Company has allotted 54,69,490
 Equity Shares of Rs. 2/- each as Bonus Shares in the ratio of one new
 Equity Share for every two Equity Shares by way of Capitalization of
 Capital Redemption Reserve and Share Premium Reserve.
 
 Conversion of Foreign Currency Convertible Bonds
 
 During the year under review, your Company had received the conversion
 notice from the Foreign Currency Convertible Bonds holder (i.e. Intel
 Capita (Cayman) Corporation) and allotted 2,1 ,000 Equity Shares of
 Rs. 10 each to the Bonds holder.
 
 Share Capital
 
 During the year under review, the paid-up capital of your Company
 stands increased from Rs. 197,552,060 to Rs. 329,405,726 due to
 corporate benefits/allotment of Equity Shares such as bonus shares,
 FCCB conversion and ESOP allotment.
 
 The Company has also subdivided one Equity Share of Rs. 10 (Rs. ten)
 each into five Equity Shares of Rs. 2 (Rs two) each.
 
 Dividend
 
 In view of the Companys profitable performance, your Directors are
 pleased to recommend, for approva of the members at the forthcoming
 Annual Genera Meeting, dividend of Rs. 1.30 per share (equivalent to
 the dividend declared in the previous financial year).
 
 Transfer to Reserves
 
 In accordance with statutory provisions, your Company has transferred a
 sum of Rs. 32.77 million to the General Reserves.
 
 Subsidiaries
 
 During the year under review, your Company had acquired management
 control in Evolv Services Limited (formally known as Evolv Management
 Services Private Limited), a leading provider of English language and
 communication training and therefore, it become another subsidiary
 company.
 
 Further, NIIT China (Shanghai) Limited, a step down subsidiary company
 in partnership/association with a company in Wuxi has incorporated a
 new overseas subsidiary company in the name of NIIT Wuxi Service
 Outsourcing Training School (NIIT-Wuxi), to train large number of
 university graduates in WND centre and equip them with relevant IT
 skills to get them jobs in companies that are/will set up in WND.
 
 At the end of the year under review, your Company has 21 subsidiary
 companies spread across the globe.
 
 Post closure of the financial year under review, your Company has also
 incorporated another subsidiary company by the name of NIIT Institute
 of Process Excellence Limited. This new company will be engaged in the
 business of imparting instructor led and/or information technology
 assisted training and distance education for enhancing
 performance/employment in the BPO and ITES industry.
 
 Your Company had pursuant to the provisions of Section 212() of the
 Companies Act, 1956 (the Act), filed applications with the Ministry of
 Corporate Affairs seeking exemption from attaching a copy of the
 Balance Sheet, Profit and Loss Account, Directors Report and Auditors
 Report of the subsidiary companies and other documents required to be
 attached under Section 212(1) of the Act. The necessary approvals from
 the Ministry of Corporate Affairs were received vide its letters dated
 February 29, 200 and June 4, 200. Accordingly, the said documents
 are not being attached with the Annual Report of your Company.  A gist
 of the financial performance of the subsidiary companies in the format
 prescribed by the Ministry of Corporate Affairs is contained elsewhere
 in the Annua Report. The Accounts of the subsidiary companies are open
 for inspection for any Member/Investor at the registered office of your
 Company. The Company will make available these documents/details upon
 request to any Member/Investor interested in obtaining the same.
 
 Corporate Governance
 
 Your Companys philosophy on Corporate Governance envisages the
 attainment of the highest levels of transparency, accountability and
 equity in all facets of its operations, in all interactions with its
 Stakeholders including Shareholders, NIITians, Lenders and Regulatory
 Authorities. In order to enhance customer satisfaction and stakeholder
 value, your Company continues to benchmark its corporate governance
 practices with the best in the world in line with international norms.
 
 Your Company has complied with all the requirements relating to
 Corporate Governance as stipulated in Clause 49 of the Listing
 Agreement. The report of the Directors on Corporate Governance is given
 as a separate section titled ‘Corporate Governance Report, which forms
 part of this Annual Report. The Auditors Certificate confirming the
 compliance to the conditions of the Corporate Governance stipulated in
 Clause 49 of the Listing Agreement is annexed to the Corporate
 Governance Report.
 
 Management Discussion and Analysis Report
 
 The Management Discussion and Analysis Report as required under the
 Listing Agreement is annexed and forms part of the Directors report.
 
 Directors
 
 In accordance with the provisions of the Companies Act, 1956 and
 Articles 64, 65 and 66 of the Articles of Association of your Company,
 Mr. Rajendra S. Pawar and Mr. P Rajendran, Directors of your Company,
 retire by rotation at the forthcoming Annua General Meeting and being
 eligible, offer themselves for reappointment.
 
 Directors responsibility statement
 
 As required under Section 217 (2AA) of the Companies Act, 1956, the
 Board of Directors of your Company hereby states and confirms:
 
 That in preparation of Annual Accounts for the financial year,
 applicable Accounting Standards have been followed along with the
 proper explanations relating to material departures;
 
 That they have selected the accounting policies described in the notes
 to accounts, which have been consistently applied, except where
 otherwise stated 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 as at March 31, 2008 and of the profit or loss of the
 Company for that year;
 
 That 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;
 
 That the Annual Accounts have been prepared on the historical cost
 convention, as a going concern basis and on accrual basis.
 
 Information relating to Conservation of energy, Technology Absorption,
 Research and Development and exports, Foreign exchange earnings and
 Outgo and other information forming part of the Directors Report in
 terms of Section 217(1)(e) of the Companies Act, 1956 and the Rules
 made thereunder.
 
 a) Conservation of energy
 
 The operations of your Company are low energy intensive.  However,
 appropriate measures, wherever possible, have been initiated to
 conserve energy. Your Company is continuously evaluating new
 technologies and invests in them to make its infrastructure more energy
 efficient.
 
 b) Technology absorption
 
 In todays world, perpetually evolving technologies and increasing
 competition define the global market space. In order to maintain its
 position of leadership, your Company has continuously and successfully
 developed state-of-the-art methods for absorbing, adapting and
 effectively deploying new technologies.
 
 c) Research and Development
 
 The Company believes that technological obsolescence is a reality. Only
 progressive research and development will help us to measure up to
 future challenges and opportunities. We invest and encourage continuous
 innovation. During the year under review, expenditure on research and
 development is not significant in relation to the nature and size of
 operations of your Company.
 
 d) Exports, foreign exchange earnings and outgo
 
 The details of foreign exchange earnings and outgo are mentioned in
 Notes Nos. 11, 12 and 13 contained in the Notes to Accounts (Schedule
 No. 20) forming part of the Balance Sheet and Profit and Loss Account
 for the financial year ended March 31, 200.
 
 Public Deposits
 
 Your Company has not accepted any fixed deposits from public and, as
 such, no amount of principal or interest was outstanding on the date of
 the balance sheet.
 
 Particulars of employees
 
 Particulars of employees as required under Section 217 (2A) of the
 Companies Act, 1956 read with the Companies (Particulars of Employees)
 Rules, 1975 are given in Annexure-I and form part of this report.
 
 Auditors
 
 M/s. Price Waterhouse, Chartered Accountants, the Auditors of your
 Company, retire at the forthcoming Annual General Meeting and have
 confirmed their eligibility and willingness to accept office, if
 reappointed.
 
 Human resources and employees Stock Option Scheme
 
 NIITians are the key resource for your Company Your Company has been
 able to create and continuously improve a favourable work environment
 that encourages novelty and meritocracy at all levels.
 
 Employees relations remained cordial at all Companys locations. The
 Directors take this opportunity to record their appreciation for the
 outstanding contribution of all NIITians.
 
 Your Company had during the financial year 2005- 06 launched the NIIT
 Employee Stock Option Plan 2005 (ESOP-2005) with the objective of
 attracting and motivating employees by rewarding performance and
 retaining the best talent. The aim was to develop a sense of ownership
 among the employees within the organisation and to align your Companys
 stock option scheme with the best practices in the Industry. During the
 year under review, the Compensation/Remuneration Committee granted
 862,500 Stock Options (Grant- II) (after adjusting corporate action of
 split and bonus)
 
 to eligible employees of your Company under ESOP 2005. The particulars
 of the Options granted, vested, exercised and allotted under the
 ESOP-2005 as required to be disclosed under SEBI (Employee Stock Option
 Scheme and Employee Stock Purchase Scheme) Guidelines, 1999, are
 appended as Annexure-II and form part of this report.
 
 Acknowledgements
 
 Your Directors take this opportunity to thanks all investors, clients,
 licensees, technology partners, vendors, financial institutions, banks,
 regulatory and governmental authorities, media and stock exchanges for
 their continued support during the year under review.
 
                                   For and on behalf of the Board
 
                                   Rajendra S Pawar
 
 Place :  New Delhi                Chairman &
 Date  : June 11, 2008             Managing Director