Dear Shareholders,
I am happy to present before you the financial highlights of our company for the year 2008 and my views on the economy and its impact on our industry.

The year 2008 has been most challenging in many ways to all of us in the corporate world. We in India started the year riding the growth wave, hoping to live with the growth story that countries like India and China represented most. The hope was soon turned into despair as the news of global economic troubles started reaching Indian shores. Subsequent global economic developments created a nightmare that we all would like to forget as soon as possible.

We were first hit very hard by the sharp rise in prices of crude oil, commodities and consequently of all kinds of raw materials we use. Pre - Olympic developments in China created shortages and pushed the prices further up. Foreign currency exchange rates added further fuel to the fire. Indian Rupee weakened by nearly 25% during the year. Starting October, prices of commodities and raw materials started crashing world wide. Companies were hit hard due to high cost of inventories they were holding, while the customers demanded sudden and steep price reductions. Drop in demand across segments added further complications.

Overall it was a year filled with turmoil, fear, speculations and uncertainties.

Given this background, I am pleased to say that our management team showed great degree of resilience and maturity to deal with this situation very effectively. All our actions were aimed at achieving our corporate goals without losing the confidence of our customers and suppliers.

Standalone revenues for the year were Rs. 13,428 as against Rs.11,527 million in the previous year, and PAT was Rs. 903 million up 33% as against Rs. 681 million in the previous year.

However, developments in the US economy had their impact on our US operations. Keeping in mind our past performance and the current economic situation, we initiated several measures to re-engineer the whole business model of our US subsidiary. HST USA ended the year with a loss of USD 8.7 million. Sales were down to USD 89 million from USD 130 million mainly as a result of decisions to re-structure the US business model.

Consolidated revenues at Rs. 16,195 million were 8% higher compared to the previous year. However, consolidated profit was lower at Rs. 337 million compared to Rs. 666 million in the previous year due to negative results of US operations.

You will agree with me that we all are passing through a very difficult phase, with unabated global recession and financial difficulties. Yet, I feel, we have sound management policies and systems in place. We also continue to benefit from our global integration within the hubergroup. I, therefore, feel confident that we will be able to deal with the challenges in 2009 successfully.

I take this opportunity to thank all of you for your continued support. I would also like to thank all our employees for their hard work and commitment and our business associates for their support and co-operation.

Sincerely ,
Anjum Bilakhia