At the very outset, I extend an opportunity to welcome you all in the
 yet another get together in our second year of going public. Year
 2007-08 is another year of robust growth and high quality earnings for
 your company and I believe that you all would acknowledge the same.
 Vishal Retails presence is really on its verge to become Vishal at
 this stage of time as we have established our reach in 29 new cities
 and have opened 52 new showrooms. In total count of our showrooms has
 reached to 101 from 49 showrooms in the previous year. Your company
 believes that growth can only be achieved through aggressive strategy
 and therefore is planning to expand to 190 showrooms in the ensuing
 year. You would be glad to hear, that your company has in this year,
 besides opening outlets in its regular format i.e. one stop solution
 or all in one store; has endured to establish specialty stores for
 various products such as Consumer durables, Medicines, Jewellery, in
 the names of Vishal Electro Mart, Vishal Medi Mart, Vishal Jewellery
 Mart respectively, The Company has also taken its stride towards
 extending its group and has established VRL Movers Ltd., VRL Consumer
 Goods Ltd., VRL Fashions Ltd. etc. to grasp the market segment/to
 strength its manufacturing base/to streamline its main line of
 business.
 
 I still recollect the yesteryears when we were incorporated in the year
 2001. The journey since then has been long and full of challenges and
 hardships. But for your faith and commitment we have been able to
 achieve the success and heights at which we are right now. On behalf of
 Vishal Retail Limited, I herewith take and opportunity to express
 thankfulness for your enduing trust towards your Company.
 
 The successful times are on, but challenges to our business are many.
 Besides our domestic competitors, the Company also faces huge
 competition from international Companies. Although foreign investment
 in retail segment is restricted yet certain formats are allowed to them
 under approval routes, which also pose threat to the competitor to
 imitate, yet, the competition in the market has forced the Company to
 reduce its profit margins. Therefore, in an effort to jack up gross
 margins, we have evolved the concept for private Labels. Private Labels
 carries the brand name of the Company itself, but manufacturing of the
 same is done both through our Manufacturing facilities and is also
 outsourced to Local Manufacturers. 
 
 We believe that our focus on our private labels and their recognition
 in our customer segment enables us to differentiate ourselves from our
 competitors as well as to improve our margins, Moving towards the
 financial and operating performance of your Company, during the year
 2007-08, our total revenues are up 67.43% from Rs. 6050.4 Million to
 Rs. 10130.75 Mn and corresponding net profits are up 62% from Rs. 250.7
 Mn to Rs. 406.4 Mn. With our consistent and innovative marketing
 efforts, the daily footfalls in our showrooms has increased by 103%
 from 89,829 to 182,396 and corresponding conversion ratio has improved
 from 42.2% to 43.1%
 
 Through the Company is striving for higher profitability at all times
 yet due to its growth model your company is not in the position to
 declare dividend for the financial year 2007-08. However, the Company
 is extending its utmost efforts to establish its presence in pan India
 and in furtherance to attaining this growth to share its profitability
 with its investors and stakeholders.
 
 The same would be possible only upon the continued patronage on your
 part. To conclude with, I would again express my gratitude towards all
 those who have trusted us and have given us a chance to add value to
 the interest of the society at large.
 
                                             Best Wishes & God Bless
                                                 Ram Chandra Agarwal