Electrotherm has yet again delivered impressive results. While the competitive environment remained hyperactive, your company with its excellent product range has been undergoing a major transformation in its marketing approach, market segments, business mix, internal processes and systems to improve its revenue mix and profitability. We have achieved all these which have resulted in excellent value addition to our customers.

It gives me great pleasure to inform you that we have once again more than doubled our last year?s turnover. The current year?s turnover stands at Rs.731 Crores as against Rs.345 crores of the last year. All this has been possible and your company has been able to scale such heights due to dedicated and committed management team.

Manufacturing is witnessing increased competition, complexity and costs. Electrotherm has strong fundamentals and technology wise your company is quite competent. Most Indian companies are either engaged in re-engineering or are manufacturing under technology transfer arrangements. At Electrotherm we do not believe in copying others but are focused on customer requirements to identify future market needs. In the short run one needs cost competitiveness but in the long run it is necessary to launch new products. This is where we are concentrating. We are faced with three main challenges: cost reduction, productivity improvement and fast speed in converting market requirements to design and manufacturing. As cost reduction is essential for ensuring the bottom line of manufacturing companies, getting newer products to the market rapidly has become a necessity. To meet these challenges of costs, productivity and speed, at Electrotherm we are embracing new technologies, processes and concepts such as lean manufacturing, just in time production, work flow technologies and work flow automation.

Economic conditions around the world have been very encouraging. Global growth which was 4.8% in 2005 reached 4.9% in 2006 and is expected to hover around this level in the current year also. While the Chinese economy is growing at around 10% without any signs of slow down, the Indian economy is also continuing to grow at more than 8%. In the coming years, I am expecting that the Indian economy will be booming owing to the heavy demand on infrastructure. Energy sector is growing by leaps and bounds as it is receiving the highest attention of both the State Governments and Central Government.

India has moved from an agrarian economy to a manufacturing economy. The manufacturing sector now contributes around one-fourth of the total GDP and the industrial output has now crossed USD 65 Billion in value.

Global steel production is continuing its growth and the production in 2006 crossed 1.2 billion ton mark. In spite of some control measures adopted by Chinese Government the crude steel registered an impressive growth and has crossed 450 million tons. India is also witnessing a huge growth in steel production and it is expected that steel industry will continue to grow by more than 12% per annum.

Sustainable economic growth of India as well as rest of the world will depend on effective energy planning. Nearly 40% of the world?s energy comes from petroleum. Natural gas contributes to another 20% and these two natural resources account for 60% of the world?s energy. The growth in consumption of oil and natural gas in the past has been such that the consumption has been doubling every 15 years. This trend is likely to continue and will lead to complete depletion of natural resources in next 30 years.

It is significant to note that more than 20% of the world?s total primary energy is consumed in transportation. There are more than 410 million cars currently in the world and in another 20 years the automobile population will reach one billion mark. It is also significant to note that after 1970 the new oil discoveries have been very few and any new discoveries will not make any significant contribution to the world?s energy pool.

Transportation sector which consumes a large share of energy resource of the country also contributes significantly towards pollution. We at Electrotherm have made it our mission to provide vehicles which are emission free, which do not use petroleum products and which are inexpensive to acquire and operate. Our launch of battery operated YoBykes has been highly successful and Electrotherm is now developing several new vehicles for the Indian market. Our launch in India has developed interest for our vehicles for international market also and in the future we will be exporting these vehicles to other countries. Electrotherm will continue to provide leadership in this segment by delivering innovative, cost effective, practical and environmental friendly electric vehicles. Economic and environmental forces are frequently pitted against each other and many a times the financial cost of environmentally friendly technologies and goods is so high that one has to strike a balance or look for Government subsidies. Our Electric Vehicles are unique in this aspect as they are not only economical but also environment friendly. You will be pleased to note that the?2007 Overdrive Automotive Product of the Year? award was given to YoBykes of Electrotherm.

My appreciation also goes to my colleagues on the Board for their guidance and advice as well as to all the employees of Electrotherm, without whose dedication and contribution, we would not have been able to achieve the growth and continuous improvement in our business.