BSEL INFRASTRUCTURE REALTY LIMITED ANNUAL REPORT 2009-2010 CHAIRMAN'S REPORT Dear Shareholders, In the very first place, I wholeheartedly acknowledge your ceaseless and stubborn support, which upheld the Company to pass through the dramatic situation placed before by this year. The year 2009-10 can be surely described as'The Economy-A Big Hurt'.'BSEL's domain, infrastructure and realty, has not shown a pretty picture at all. If we have a little retrospection, it can be noted that, the residential real estate business started slowing in 2006 and then really fell out of bed in 2007. But commercial real estate continued chugging along for a while. That's all changing - and 2009 has been even worse for landlords and investors in commercials, warehousing, office, retail property and related spheres. After more than a year spent in suspended animation of already faded up housing markets, the commercial real estate industry really hit a bottom in 2010. With the collapse of Lehman Brothers and other Wall Street icons, there was cataclysmic recession which substantially affected the year 2008-09. As the world economy just started taking a breath after absorbing these shocks, UAE debt crisis hit the economy. And once again, the Infrastructure and realty industry is put on a blow. As Infrastructure and Real Estate is core functional sphere of BSEL and the Company has sizable portion of its project investments in UAE, there was an enforced holiday for BSEL. Even in this state of affairs, management of the Company succeeded in saving the Company from getting into the liquidity crunch. The Company strategically exited from a quite adversely leveraged six projects in Nagpur and one project in Goa and also packed up one of its subsidiaries, in Singapore. Though for a short term, the consequence of this is a downturn in profitability of the Company, which can be attributed to exceptional heavy losses out of exit from joint venture projects and closure of subsidiary. During the year under consideration, Company's consolidated total income is Rs. 3,290 lacs and the consolidated profit stood at Rs.86.87 lacs .The BSEL - India suffered a loss in this year, as real estate developers is one of the worst victims of global melt down and UAE collapse. Here... all these facts are quite disappointing... but I would like to put a saying of George Patton..'Success is how high you bounce when you hit bottom'. I believe that there is a sure opportunity in any state of affairs. This downtrend caused by global meltdown and UAE debt crisis led to a considerable correction of prices across locations, including some established as well as under developed locations. The debt markets are in a severely compromised position due to the cautious approach of banks and financial institutions with a view of avoiding further debt stress. In this classic timing play, investors and developers with cash should be poised to take advantage of highly attractive buying opportunities. And here, BSEL is in propitious position, as it is a Zero Debt Company having optimum liquidity. I am confident that, BSEL is devised enough and poised to grab each and every opportunity in this sphere. Your support along with sincere contributions of investors, customers, associates and employees of the Company is a constructive stimulus for BSEL, resting on this I see BSEL as one of the leading real estate developers in India as well as abroad in a very near future. Kirit R. Kanakiya Chairman