Unity Infraprojects

Dear Shareholder,
 
 The Financial Year 2009 was an extraordinary year for the global
 economy, marked by liquidity crunch, fear psychosis and significant
 slackening in demand. Most developed economies showed negative GDP
 growth rate, and overall economic situation is still uncertain.
 
 The global economic crisis had a significant impact on the Indian
 economy, hurting GDP growth rate, drying up liquidity and reducing risk
 appetite. Further, the impact was hardest on the fast growing
 infrastructure and construction sectors, which require significant and
 high gestation investments. The overall growth rate in these segments
 fell from 12%+ in 2006-07 to around 7% in 2008-09. This led to
 significant reduction in new investments in construction by cash
 strapped corporates. Also, with Code of Conduct in place because of
 general elections, there were hardly any new government orders in last
 quarter of the financial year.
 
 In spite of these challenging macro environment factors, I am pleased
 to inform that your Company has delivered a steady performance for FY
 2009:
 
 - Total income increased by 33% to Rs. 1,147 crores
 - EBITDA increased by 34% to Rs. 159 crores
 - EBITDA margins maintained at 13.9%
 - PAT increased by 16% to Rs. 69 crores
 - Net worth increased to Rs. 418 crores, a growth of 18%
 - Order book at Rs. 2,694 crores, an increase of 12% over FY 2008.
 
 The steady performance in FY 2009 clearly indicates that even in such
 tough macro conditions, our business strategy and processes remain
 robust, and that we are well positioned to take advantages of the
 business opportunities ahead.
 
 Moreover, the global economic environment seems to be stabilizing, and
 India is one of the few countries in the world, which are likely to
 grow by more than 6-7% a year. The political situation in India has
 also stabilized, with the formation of the new government.  The
 Government has shown keen focus on infrastructure development in the
 country. The Government has set a goal of increasing the investment in
 infrastructure to more than 9% of GDP by 2014 from current 5%. The
 Government has increased investments in urban infrastructure, highways,
 power etc., which augurs well for the construction industry.
 
 We continue to remain focused on working with reputed and financially
 strong infrastructure and real estate companies. We continue to widen
 our geographic footprint, strengthen our expertise in handling diverse
 types of projects, and have a judicious mix of Government and private
 projects. Further, we continue to enhance our financial strength, which
 is especially important in the current business context. We have also
 benchmarked our cost structure with that of the industry, and are
 pleased to find that we are amongst the most cost effective in the
 industry. Nevertheless, waste reduction is an ongoing exercise, and we
 shall continue our efforts in this direction.
 
 I am also glad to share that your Company was chosen as one of the Top
 200 Asian companies with revenues under a Billion Dollar by the
 prestigious international business magazine, Forbes. Your Company
 also received many other awards including Best Professionally Managed
 Company from Construction Industry Development Council (CIDC), India,
 and Directors Shield Safety award for BARC Site Mumbai by BARC
 Safety Council.
 
 I am confident that the steps we have taken in FY 2009 augur well for
 long term prospects of the Company, resulting in sustainable
 shareholder value creation.
 
 I would like to thank all the shareholders for their continued
 confidence in the Company. I would also like to thank all the Companys
 employees and Senior Management Personnel for their dedication.
 
 Kishore K. Avarsekar, 
 Chairman & Managing Director