Oracle Financial Services Software

The Directors take great pleasure in presenting their report on the
 business and operations of your Company along with the Annual Report
 and audited financial statements for the Financial Year 2007-08.
 
 Financial highlights
 
 As per Indian GAAP Unconsolidated:
                             (All amounts in millions of Indian Rupees)
                                            Year ended       Year ended
                                        March 31, 2008   March 31, 2007
 
 Revenue                                     17,929.72       15,523.44
 Income from operations before
 depreciation & amortization                  4,551.97        4,027.53
 Depreciation & amortization                   (603.10)        (565.35)
 Provision for diminution in
 value of investment                           (120.00)              -
 Interest/other income (expenses)               486.53          348.30
 Income before taxes                          4,315.40        3,810.48
 Provision for tax                             (206.66)        (263.74)
 Net income                                   4,108.74        3,546.74
 Balance brought forward                      4,009.57          464.24
 Profit available for appropriation           8,118.31        4,010.98
 Transfer to general reserve
 Proposed dividend
 Corporate dividend tax                              -            0.17
 Dividend paid on stock options
 exercised before AGM 2007                           -            1.24
 Balance carried forward                      8,118.31        4,009.57
 
 As per Indian GAAP Consolidated financial statements:
                              (Ml amounts In millions of Indian Rupees)
                                            Year ended       Year ended
                                         March 31,2008   March 31, 2007
 
 Revenue                                     23,802.36       20,609.38
 Income from operations before
 depreciation & amortization                  4,672.30        4,424.50
 Depreciation & amortization                   (705.88)        (653.02)
 Interest/other income
 (expenses)                                     639.70          359.65
 Income before taxes                          4,606.12        4,131.13
 Provision for tax                             (441.68)        (415.96)
 Net income for the year before
 minority interest, share of
 profit (toss) of associate                   4,164,44        3,715.17
 Minority interest                               (4.42)       -
 Share of profit (loss) of
 associate                                       (4.12)           7.63
 Net income                                   4,155.90        3,722.80
 
 Performance
 
 On an unconsolidated basis, your Companys revenue grew to Rs.
 17,929.72 million during the financial year 2007-08 from Rs. 15,523.44
 million last year, a growth of 16%. The Companys net income recorded
 16% growth over the previous financial year and increased to Rs.
 4,108.74 million.
 
 Revenue, on the basis of consolidated financials stood at Rs. 23,802.36
 million this year, an increase of 15% from Rs. 20,609.38 million as
 compared to the previous financial year. The Companys net income
 increased to Rs. 4,155.90 million this year, an increase of 12%.
 
 A detailed analysis of the financials is given in the Management
 Discussion and Analysis report that forms part of this Annual Report.
 
 Dividend
 
 Your Company has aggressive plans to capitalize on the market
 opportunities and needs to invest substantially in the growth of the
 business. Keeping this in view, the Board has decided not to declare a
 dividend for the year ended 2007-08. The funds will be used to further
 invest in the growth opportunities to enhance the leadership of your
 Company.
 
 Transfer to reserves
 
 The Company does not propose to transfer any amount to the General
 Reserve out of the amount available for appropriation. An amount of Rs.
 8,118.31 million is proposed to be retained in the Profit & Loss
 Account.
 
 Share capital
 
 During the year, the Company allotted 395,529 equity shares of face
 value of Rs. 5/- each to GE Capital Mauritius Equity Investment (GE)
 upon exercise of the conversion option of equal number of warrants
 allotted to GE in August 2005. The Company also allotted 63,332 equity
 shares of face value of Rs. 5/- each to its employees/directors who
 exercised their options under the Employee Stock Option Plan.
 
 As a result, as on March 31,2008, the paid up equity share capital of
 the Company increased to Rs. 418,737,205 divided into 83,747,441 equity
 shares of face value of Rs. 5/- each.
 
 Change of name
 
 Oracle Global (Mauritius) Limited, the promoter of the Company holds
 80.58% of the paid up equity capital of your Company. Oracle is the
 worlds largest enterprise software provider. Your Company is a world
 leader in providing IT solutions to the financial services industry.
 With this background, the Board has approved the proposal to change the
 name of your Company from i-flex solutions limited to Oracle
 Financial Services Software Limited, subject to the regulatory and
 shareholders approvals.  The proposed name demonstrates the synergies
 of scale, resources expertise and efficiency across the two
 organizations and reflects the importance that Oracle attaches to the
 financial services sector.
 
 The approval of the shareholders for the change of name is being sought
 at the Extra-ordinary General Meeting to be held on August 11, 2008.
 
 Oracles holding in i-flexs shares
 
 As of March 31, 2008, Oracle held 67,481,698 equity shares (80.58% of
 the equity capital of the Company).
 
 Use of IPO proceeds
 
 In June 2002, your Company completed its Initial Public Offer (IPO) in
 India and listed its shares on the National Stock Exchange of India
 Ltd.  (NSE) and Bombay Stpck Exchange Ltd. (BSE). The entire IPO
 proceeds aggregating Rs. 1,781 million have been utilized as under:
 
 Utilization of funds                                Rupees in million
 
 Issue related expenses                                    103
 Bangalore Development Center                              555
 Mumbai Development Center                               1,018
 Setting up of Dubai Office                                  1
 Investment in subsidiary companies                        104
 
 Total                                                   1,781
 
 Your Company had issued shares to Oracle Global (Mauritius) Limited on
 a preferential basis on September 14, 2006. The proceeds aggregating to
 Rs. 5,815 million have been utilized as under:
 
 Utilization of funds                           Rupees in million
 
 Investment in i-flex America inc. in connection       5,679
 with the acquisition of Mantas inc.  
 Investment in i-flex America inc. in connection
 with the acquisition of the balance equity
 stake in Castek Inc.                                    136
 
 Total                                                 5,815
 
 All the proceeds of the IPO of 2002 and the preferential issue of 2006
 have been utilized for the purposes for which they were raised.
 
 Infrastructure
 
 During the year, your Company made significant additions to its
 infrastructure to meet its growing business requirements. The Company
 opened new offices in Bangalore and Mumbai, creating capacity to
 accommodate 2,000 additional professionals. The Companys subsidiaries
 also added offices in New Jersey and London to accommodate a larger
 workforce.
 
 The construction of the Companys landmark building in Goregaon, Mumbai
 right next to the Western Express Highway is complete. This building is
 architecturally unique in Mumbai, having four floors for parking and 10
 floors for work space. It has a unique Dome shaped reception with a
 water body around it. Your Company is in the process of finalizing the
 lease for over a million square feet of contiguous office space in
 Bangalore in a Special Economic Zone (SEZ).
 
 Integration with Oracle Policies and Procedures
 
 In order to derive synergies from Oracles global presence and
 resources and fully comply with the governance norms that both i-flex
 and Oracle  are bound by, the Board has authorized the Company to
 adopt Oracles policies and procedures within the applicable framework
 of local regulations.
 
 Acquisitions
 
 Acquisition of balance equity stake in Flexcel International Private
 Limited
 
 On March 31, 2008, Flexcel (a joint venture with HDFC Bank Limited and
 its group companies and Lord Krishna Bank) became a wholly owned
 subsidiary of i-flex solutions ltd effective March 31, 2008 with the
 acquisition of the balance 60% shares of Flexcel from its co-venture
 parties.
 
 i-flex solutions s.a.
 
 On July 2, 2007, i-flex solutions b.v, (i-flex b.v.} acquired the
 banking business from Athens Technology Center SA (ATC) for Rs.
 670.05 million. The acquisition was structured by way of transfer of
 all contracts, employees and fixed assets of the banking business from
 ATC to a newly formed entity, i-flex solutions s.a., Greece with 90%
 shares owned by i-flex b.v. Further, the Company has the right to
 acquire balance 10% shares (based on earn out formulae) over 3 years in
 a tranche of 5%, 3% and 2% after completion of 1,2 and 3 years
 respectively from the date of acquisition. As the consideration payable
 is dependent on future revenue and profits, the same is considered to
 be a contingent consideration and will be accounted when the liability
 arises. The Group consolidated i-flex solutions s.a. from July 2, 2007
 and recorded goodwill amounting to Rs. 656.64 million.
 
 Castek Software Inc. (Castek)
 
 On November 16, 2007, Castek became a wholly owned subsidiary of i-flex
 America inc. with the acquisition of the balance 23.23% shares of
 Castek from minority shareholders for a total consideration of Rs.
 327.39 million. As part of the acquisition, certain employees owning
 shares of Castek were paid additional consideration amounting to Rs.
 90.81 million based on the number of shares held by them. The Group has
 recorded additional consideration-payment as employee compensation.
 The Group recorded balance consideration as goodwill of Rs. 238.02
 million considering Casteks negative net worth and minority losses
 being absorbed by the Group till the date of acquisition.
 
 Global alliances
 
 Your Company lays a great emphasis in building and expanding its
 partner network with organizations which can promote, sell, implement
 and support its offerings around the world. The partner network
 currently comprises 33 resellers and 20 implementation partners. The
 expansion of partners has been prominent in the East European region,
 especially in Russia and the CIS countries. 
 
 Leading System Integration (SI) Partners play an active role in
 delivering solutions to customers of your company. The SI Partners
 deliver projects in the CIS, Latin America, Middle East, Japan and
 India.
 
 The highlight of the engagement with partners this year has been the
 enablement of partners to sell, implement and support our flagship
 product FLEXCUBE, Reveleus, Mantas and Daybreak. There has been almost
 a three-fold increase in the number of consultants with partner
 organizations who have been trained and are qualified to implement
 FLEXCUBE during the past year.
 
 Subsidiaries
 
 Your Company has subsidiaries in India, the USA, Singapore, the
 Netherlands, Canada, Mauritius and Greece to handle operations as well
 as to strengthen marketing and sales efforts in the respective markets
 and to ensure deeper sales penetration in these regions.
 
 During the financial year, i-flex solutions s.a., Greece became a
 majority owned subsidiary of the Company through i-flex solutions b.v.,
 the Netherlands The Companys subsidiary i-flex America inc. has
 acquired the remaining equity stake in its subsidiary company Castek
 Inc., Canada.
 
 Pursuant to Section 212 of the Companies Act, 1956 (the Act), the
 Company is required to attach to its Annual Report, the Balance Sheet,
 Profit and Loss Account, Directors Report and the Report of the
 Auditors (collectively referred to as the accounts and reports), of
 its subsidiaries for the year ended March 31,2008. Since the Company
 presents audited consolidated financial statements under Indian GAAP in
 its Annual Report, the Company had applied to the Central Government
 for an exemption from attaching the accounts and reports of its
 subsidiaries to the Annual Report. The approval of the Central
 Government in this regard has been received vide letter no.
 47/246/2008-CL-lll dated June 24, 2008 exempting the Company from,
 attaching the accounts and reports of subsidiary companies under the
 provisions of Section 212 of the Act. As such, the accounts and the
 reports of the subsidiary companies are not attached to the Annual
 Report of the Company.
 
 The Company will make available the accounts and the reports of the
 subsidiary companies upon request by any member/investor of the Company
 or its subsidiaries. Further, the accounts and the reports of the
 subsidiary companies will be kept open for inspection by any member at
 the registered/corporate office of the Company and the registered
 office of the subsidiaries during office hours of the
 Company/subsidiaries.
 
 Fixed deposits
 
 During the financial year 2007-08, the Company has not accepted any
 fixed deposit within the meaning of Section 58A of the Companies Act,
 1956 and as such, no amount of principal or interest was outstanding as
 of the date of the Balance Sheet.
 
 Awards, honors and recognitions
 
 Your Company has consistently received wide recognition for leadership
 and achievements.
 
 - Business Week (November 2007) ranked i-flex solutions as one of
 Asias Hot Growth Companies: 2007, i-flex was ranked second highest
 in terms of market capitalization, third highest in terms of sales and
 sixth highest in terms of profits.
 
 - i-flex solutions was ranked 30 in the annual FinTech 100 list of
 financial industry technology vendors by American Banker and Financial
 Insights (November 2007).
 
 - i-flex BPO won the NASSCOM Excellence in Gender Inclusivity- Best
 Emerging Company award. This award was given away at the NASSCOM IT
 Women Leadership Summit 2007 held in December 2007.
 
 - The All India Electronics and Computer Software Export Promotion
 Council (ECS) award for Excellence in Exports for the year 2006-07 This
 award was presented to i-flex in October 2007.
 
 - i-flex recognized as a Deal Leader in global banking platforms by
 independent research firm Forrester Research Inc. in the August 2007
 report Global Banking Platform Deals 2006: Vendors.
 
 - Mantas ranked number one in the Waters Ranking for Anti-Money
 Laundering (AML) Solutions in July 2007.
 
 - Dataquest magazine rated i-flex BPO among the top 10 dream
 employers in the BPO sector in November 2007. This rating ranks
 companies on various parameters linked to employee satisfaction.
 
 - In November 2007, i-flex successfully completed the SAS70 Review of
 Internal Controls for the sixth consecutive year.
 
 Litigation
 
 PortfolioScope, a company based in the United States of America, has
 filed a lawsuit in a US District Court for the District of
 Massachusetts alleging misappropriation of confidential and proprietary
 information by the Company. The Company firmly believes that the
 allegations are false, unwarranted and without merit and will
 vigorously oppose the claims made by PortfolioScope. The Company had
 filed a motion to dismiss PortfolioScopes complaint and has instructed
 the legal advisers to take all appropriate actions to protect the
 interests of the Company and its customers. The motion to dismiss was
 granted in part, Discovery concluded on the limited issue of whether
 PortfolioScopes claims were timely filed and is now going forward on
 the question of whether or not the claims have any merit. The Court has
 set a trial date for October 14, 2008.
 
 Corporate governance
 
 The Company has taken appropriate steps and measures to comply with all
 the applicable provisions of Clause 49 of the listing agreement entered
 with stock exchanges and Section 292A of the Companies Act, 1956.
 
 Your Company has constituted five committees consisting of Board
 members, namely, Audit Committee, Compensation Committee, Transfer
 Committee, ESOP Allotment Committee and Shareholders Grievances
 Committee. A separate report on Corporate Governance, along with a
 certificate of Statutory Auditors of the Company, is annexed herewith.
 
 A certificate from the Managing Director and Chief Financial Officer of
 the Company confirming internal controls and checks pertaining to
 financial statements for the year ended March 31, 2008 was placed
 before the Board of Directors and the Board has noted the same.
 
 A list of the committees of the Board and names of their members is
 given below. The scope of each of these committees and other related
 information is detailed in the enclosed Corporate Governance Report.
 
 Audit committee
 
 Mr. Y M Kale (Chairman)
 Mr. S P Bhamcha
 Mr. William T Comfort, Jr.
 Ms. Tarjani Vakil
 
 Compensation committee
 
 Mr. William T Comfort, Jr. (Chairman)
 Mr. Y M Kale
 Mr. Charles Phillips
 
 Transfer committee
 
 Ms. Tarjani Vakil (Chairperson)
 Mr. Deepak Ghaisas
 
 ESOP allotment committee
 
 Ms. Tarjani Vakil (Chairperson)
 Mr. Deepak Ghaisas
 
 Shareholders grievances committee
 
 Ms. Tarjani Vakil (Chairperson)
 Mr. Deepak Ghaisas
 
 Allotment of ESOP shares
 
 The shareholders of the Company had approved the Employees Stock Option
 Scheme (ESOP) of the Company in its Annual General Meeting of 2001.
 According to the said scheme, the Company has granted shares to
 eligible employees/directors from time to time. The details are given
 below.
 
 Financial year                  Total number of Options granted
 
 2001-02                                     4,548,920
 2002-03                                        80,000
 2003-04                                        36,000
 2004-05                                        60,000
 2005-06                                        10,000
 2006-07                                       373,000
 2007-08                                           Nil
 
 Total                                       5,107,920
 
 Pricing formula                            At the fair market value
                                            as on the date of grant
 
 Options vested at the end of the
 financial year 2007-2008                              148,453
 Options exercised during
 2007-2008                                              63,332
 Total number of shares arising
 as a resul of exercise of options
 during 2007-08                                         63,332
 Options lapsed                                              
 
 2002-03                                               129,520
 2003-04                                               112,500
 2004-05                                                82,200
 2005-06                                                87,600
 2006-07                                                46,600
 2007-08                                                35,900
 
 Total                                                 494,320
 
 Variation of terms of options                            None
 Money realized by exercise of
 options                                        Rs. 40,022,853
 
 Total number of options in force                      431,253
 
 Employee-wise details of options granted during the financial year
 ended March 31, 2008 to:
 
 Number of Options
 
 i.   Director                                                   Nil
 
 ii. Any other employee who receives grant in any one
 year of option amounting to 5% or more of option
 granted during that year                                        Nil
 
 iii. Identified employees who were granted option, during
 any one year, equal to or exceeding 1% of the
 issued capital (excluding outstanding warrants and
 conversions) of the Company at the time of grant                Nil
 
 iv. Diluted Earnings Per Share (EPS) pursuant to the
 issue of shares on exercise of option calculated in
 accordance with accounting standard 20 Earnings
 Per Share issued by the Institute of Chartered
 Accountants of India                                      Rs. 49.17
 
 Had compensation cost for the Companys ESOP been determined based
 on fair value at the grant dates, Companys net income and earnings per
 share would have been reduced to pro forma amounts indicated below:
 
 March 31,2008
 
 Net income as reported                                    4,108,745
 Less: Compensation expense
 determined using fair value of
 options                                                     (54,918)
 Pro forma net income                                      4,053,827
 Basic income per share:
 
 As reported                                                   49.10
 Pro forma                                                     48.44
 Diluted income per share:
 
 As reported                                                   49.02
 Pro forma                                                     48.37
 
 During the financial year 2007-2008, no fresh options were granted,
 hence, the data related to weighted average exercise price of the
 options and weighted average fair value of the options is not
 disclosed.
 
 Human resources
 
 Employees are our key assets and we have created a healthy and
 productive work environment which encourages excellence. We
 continuously invest in training staff in the latest technology trends
 and in various sub-verticals within the financial services domain.
 
 To meet business growth requirements, we have invested in increasing
 the manpower strength in the product business by 32%, from 2,931 at the
 end of March 2007 to 3,868 at the end of March 2008. Overall, on a
 gross basis, we added 2,751 employees in our software and services
 business in the financial year. Our strength in the KPO business stood
 at 875. Overall, our staff strength at the end of March 2008 was
 11,006.
 
 Directors responsibility statement
 
 As required under Section 217(2AA) of the Companies Act, 1956, the
 Directors hereby confirm that:
 
 i. In preparation of the annual accounts, the applicable accounting
 standards have been followed along with proper explanation relating to
 material departures;
 
 ii. The Directors 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 profit of
 the Company for that period;
 
 iii. The Directors have taken proper and sufficient care for the
 maintenance of adequate accounting records in accordance with the
 provisions of this Act for safeguarding the assets of the Company and
 for preventing and detecting fraud and other irregularities;
 
 iv. The Directors have prepared the annual accounts on a going
 concern basis.
 
 Directors
 
 Mr. Y M Kale, Ms. Tarjani Vakil and Mr. Charles Phillips, retire by
 rotation at the ensuing Annual General Meeting and being eligible,
 offer themselves for re-appointment. Mr. S P Bharucha holds office till
 the conclusion of the ensuing Annual General Meeting and has not
 offered himself,for re-appointment. The Board places on record its
 appreciation for the contributions made by Mr. Bharucha as a member of
 the Board and Audit Committee.
 
 Pursuant to Section 260 of the Companies Act, 1956, Mr. Sergio
 Giacoletto Roggio was appointed as an Additional Director of the
 Company on October 26, 2007. He holds office up to the date of the
 ensuing Annual General Meeting. The Company has received a Notice in
 writing from a Member pursuant to Section 257 of the Companies Act,
 1956, proposing the candidature of Mr. Sergio Giacoletto Roggio for the
 office of Director.
 
 The Board recommends to the shareholders the resolutions for
 re-appointment of Mr. Y M Kale, Ms. Tarjani Vakil and Mr. Charles
 Phillips as Directors of the Company. The Board also recommends the
 appointment of Mr. Sergio Giacoletto Roggio as a Director of the
 Company.
 
 Brief resumes of the Directors proposed to be appointed/re-appointed,
 nature of their expertise in specific functional areas and names of
 companies in which they hold directorships and membership/ chairmanship
 of Board Committees, as stipulated under Clause 49 of the Listing
 Agreement entered into with the stock exchanges are provided in the
 Report on Corporate Governance forming part of the Annual Report.
 
 Auditors
 
 M/s S. R. Batliboi & Associates, Chartered Accountants, the present
 Statutory Auditors of the Company, hold office till the ensuing Annual
 General Meeting and have confirmed their eligibility and willingness to
 accept office, if re-appointed.
 
 Auditors Report
 
 With regard to the Auditors comment in the CARO report on delay in
 payment of Fringe Benefit Tax (FBT) and Stamp Duty, the following are
 our responses:
 
 i. During a review of FBT, the Company has been advised that the
 expenses recovered from its customers which are not debited to its
 Profit & Loss account are liable to FBT. Accordingly, the Company has
 made a provision for FBT for the Financial Years 2005-06 and 2006-07
 during the current financial year. The FBT payment is being made.
 
 ii. During the internal control checks, the Company found that it had
 inadvertently not paid stamp duty on a few share certificates at the
 time of their issuance. The Company voluntarily informed the Collector
 of Stamps of the same and paid the amount of stamp duty including
 penalty thereof for the delayed period.
 
 Conservation of energy, technology absorption and foreign exchange
 earnings and outgo
 
 The particulars as prescribed under Sub-Section (1)(e) of Section 217
 of the Companies Act, 1956 read with Companies (Disclosure of
 Particulars in the Report of Board of Directors) Rules, 1988, the
 relevant data pertaining to conservation of energy, technology
 absorption on foreign exchange earnings and outgo are furnished
 hereunder:
 
 a. Conservation of energy
 
 The operations of the Company are not energy-intensive. The Company
 however takes measures to reduce and optimize energy consumption by
 using energy efficient computers, CFL bulbs and electronic
 ballast-basea lighting. Further offices have been designed to maximize
 the use of ambient lighting while conserving the air conditioning. The
 expense on power in relation to income is nominal and under control.
 
 b. Technology absorption
 
 Since businesses and technologies are changing constantly, research and
 development activities are of paramount importance. Your Company lays a
 great emphasis on knowledge management and has an institutionalized
 process for absorption of new technologies. Your Company continues its
 focus on quality up-gradation of software development process and
 software product enhancements.
 
 c.  Foreign exchange earnings and outgo:
 
                            (All amounts in millions of Indian Rupees)
 
 Foreign Exchange Earnings*                               17,370.60
 Foreign Exchange Outgo                                    5,558.82
 (Including capital goods and other expenditure)
 
 Excluding reimbursement of traveling expenses and interest income
 
 Prospects
 
 The global financial services industry is a major user of technology
 for transformation and growth. Your company has benefited from the
 consolidation among banks and expansion of the operations to new
 geographies in the past year. Rising customer expectations, a
 sophisticated and demanding compliance regime and mounting costs of
 operations are forcing financial institutions worldwide to
 strategically review their IT assets and look for comprehensive modern
 solutions to address their needs.
 
 Institutions are also launching new and innovative offerings, e.g.
 internet-based banks, that effectively leverage technology to create a
 differentiated proposition to customers. The cycle of replacing core
 transaction systems is gaining further strength and customers are
 looking for strategic partners who can fulfill a larger canvass of
 their requirements. Further, financial institutions are investing in
 governance, risk and compliance solutions based on regional regulatory
 mandates.
 
 Your Company, together with Oracle, today offers the industrys most
 comprehensive solution footprint based on the latest technology that
 can meet the requirements of financial institutions globally.
 
 Employee particulars
 
 Information pursuant to Section 217(2A) of the Companies Act, 1956,
 read with the Companies (Particulars of Employees) Rules, 1975 and
 under Section 217 (1)(e) of the said Act, read with the Companies
 (Disclosure of Particulars in the Report of Board of Directors) Rules,
 1988 to the extent applicable are set out in the Annexure hereto.
 
 Acknowledgements
 
 Your Directors take this opportunity to thank the Companys customers,
 shareholders, vendors and bankers for their continued support during
 the year. Your Directors also wish to thank the Government of India and
 its various agencies, Department of Electronics, the Software
 Technology Parks-Bangalore, Mumbai, Chennai and Pune, the Santacruz
 Electronics Export Processing Zone, the Customs and Excise department,
 Ministry of Commerce, Ministry of Finance, Ministry of External
 Affairs, Department of Telecommunication, the Reserve Bank of India,
 the State Governments of Maharashtra, Karnataka, Haryana and Tamil Nadu
 and other local Government Bodies for their support and look forward to
 their continued support in the future.
 
 Your Directors also place on record their appreciation for the
 excellent contribution made by all employees of i-flex through their
 commitment, competence, co-operation and diligence with a view to
 achieving consistent growth for the Company.
 
                                        For and on behalf of the Board,
 
                                        Rajesh Hukku
                                        Chairman
 July 21,2008