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Excellence in uncertainty

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									Excellence in uncertainty
 Omnitech InfoSolutions Limited Annual Report 2008-09
Forward Looking Statement
In this Annual Report, we have disclosed forward-looking information to enable investors to comprehend
our prospects and take investment decisions. This report and other statements - written and oral - that
we periodically make contain forward-looking statements that set out anticipated results based on the
management’s plans and assumptions. We have tried wherever possible to identify such statements by using
words such as ‘anticipate’, ‘estimate’, ‘expects’, ‘projects’, ‘intends’, ‘plans’, ‘believes’, and words of similar
substance in connection with any discussion of future performance.

We cannot guarantee that these forward-looking statements will be realized, although we believe we have
been prudent in assumptions. The achievements of results are subject to risks, uncertainties, and even
inaccurate assumptions. Should known or unknown risks or uncertainties materialize, or should underlying
assumptions prove inaccurate, actual results could vary materially from those anticipated, estimated, or
projected. Readers should keep this in mind. We undertake no obligation to publicly update any forward-
looking statements, whether as a result of new information, future events or otherwise.




What’s Inside?
About Us .................................................................................................................................................2
Milestones..............................................................................................................................................4
Year 2008-09 in Review .......................................................................................................................6
Our Service Offerings........................................................................................................................... 8
Managing Director’s Review .............................................................................................................. 12
Excellence in Uncertainty................................................................................................................... 14
Awards and Accolades ...................................................................................................................... 26
Board of Directors’ Profiles .............................................................................................................. 28
Key Management Personnel Profiles .............................................................................................. 32
Management Discussion and Analysis ............................................................................................ 36
Directors’ Report.................................................................................................................................49
Report on Corporate Governance .................................................................................................... 56
Financial Statements (Standalone) ...................................................................................................69
Financial Statements (Consolidated) ............................................................................................... 98
Corporate Information .......................................................................................................................116
Recession, slowdown, job-losses, liquidity crunch, financial losses –
uncertainty all around. The year 2008-09 was one such year when the
economies around the world underwent a tailspin. India was no exception.
The oil prices were northward bound and so was the case with inflation. The
credit crunch affected corporate as well as individuals. Each activity was
looked into critically and budgets were tightened. Information and technology
segment was one of the worst affected since the BFSI segment overseas
came to a complete halt.




In a tough year, we chose to get going - to post an increase of 31 per cent
in net income and 29 per cent in net profits. The idea was to discover and
unearth opportunities in the face of challenges. At Omnitech, we call it
– Excellence in Uncertainty.
                                     ABOUT US MANAGING DIRECTOR’S REV IEW   EXCELLENCE IN UNCERTAINTY




About Us




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                                       OUR VISION
                                       To be a global leader in providing technology related services in the area of Business
                                       Availability and Business Continuity Services to enable organisations to derive higher
                                       Productivity, Predictability & Profitability for their competitive business advantage.
                                       Incorporation and promoters

                                       REPUTATION
                                       We are the leading IT technology services providers in Business Availability and
                                       Business Continuity verticals. We have evolved from starting as a Third Party service
                                       provider and System Integrator to one stop solution providers in IT verticals relating
                                       to Business availability services which include Infrastructure, Application and
                                       Performance Management services and Business continuity services & disaster
                                       Recovery Services.

                                       HUMAN CAPITAL (as on 31st March, 2009)
                                       Total employees – 773 (605 technical professionals and 168 support staff)

                                       PRESENCE
                                       Head Office - Andheri, Mumbai

                                              Branches - Bangalore, Delhi, Pune, Navi Mumbai & Hyderabad (Disaster
                                              recovery centers)

                                              Support locations – 558 locations across India

                                              International presence – USA, Belgium, Netherland, Canada, Bahrain and
                                              Japan

                                       CERTIFICATIONS
                                       ISO 9001:2000

                                       AT THE CAPITAL MARKETS
                                           Listed at The Bombay Stock Exchange (BSE) (Stock code [532882]) and The
                                           National Stock Exchange (NSE) (Stock code [OMNITECH])

                                              Over 11,300 shareholders

                                              Market capitalisation as on 31st March, 2009 – Rs. 49 cr




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              Milestones
                     1987             Business started as a partnership firm by Mr. Atul Hemani
                                      and Mr. Avinash Pitale




                     1990             Incorporation




                     1992             Launched IPX Diskless Stations




                     1994             Launched Note Books in India under our Brand name “Omnitech”




                     1995             Pioneers in launch of Floptical Drivers in India




                     1996             Introduced Facility Management Services



                                      Successful Launch of Software Development Lab Facility at

                     2000            `
                                      our Navi Mumbai office

                                      Received ISO certification 9002


                                      Launched Business Continuity Planning Services
                     2001             Upgradation of ISO certificate to 9001:2000


                                      Launched Software Product – OmniManageIT (IT infrastructure
                     2002             management suite) and OmniBusinessIT CRM software Brand name
                                      “Omnitech”




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                                  Commenced developing of software product under style
                                  name OmniTransport (business process automation from

               2003               transport corporation)

                                  Launched Software Product – OmniAudit
                                  (Asset tracking tool)


                                  Acquired a firm named Edventure System Incorporated
                                 which enhanced our capabilities and helped us to provide
                                  value added services as Performance Management, Functional

               2006               Testing, security testing etc.

                                  Commenced operation of NOC and Technology Center -
                                 “Omnitech House” and Introduced OmniMonitor, an
                                  Infrastructure and Application Monitoring Appliance



                                  Formed Joint Venture called “Arham Technologies” in Japan.

                                  Became a public listed Company. IPO subscribed over 70 times

               2007               Incorporation of Omnitech Technologies Inc., a wholly owned
                                  subsidiary of Omnitech InfoSolutions Limited, in the State of
                                  Delaware, United States of America


                                  Launch of “Omni Center” India’s first Managed Disaster
                                  Recovery Center

                                  Started WebSphere Competency Center (WCC), an initiative that
                                  helps to build and harness capabilities required to deliver services
                                  built around IBM WebSphere Family of Products which are used

               2008               by Customers in India and Worldwide to deploy and integrate
                                  enterprise level solutions

                                  Designed and Developed “ Key word Driven Architecture (KWDF) for
                                  simplifying test automation and improve ROI around 33 per cent

                                  Spearheading the Mumbai Chapter of Business Resilience consortium
                                  of renowned industry individuals for Disaster Recovery & Business
                                  Continuity Planning, to inculcate value of BCP within organisations




                                                                                                  Annual Report 2008-09   5
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                       Year 2008-09
                       in Rev iew

                                 OPERATIONAL HIGHLIGHTS
                                     41 new clients added, total clients increased to 300+

                                     245 total contracts entered into during the year

                                     Recruited 50 people during the year

                                     Reach increased to 5 countries

                                     OmniCenter completed the first year of operations



                                 FINANCIAL HIGHLIGHTS

                                                     Sales (Rs. in Lacs)           17,142.62


                                                                       13,156.36



                                                            7,763.78

                                                 5,409.37
                                      4,651.02




                                      FY’05      FY’06       FY’07       FY’08      FY’09



                                                    EBITDA (Rs. in Lacs)
                                                                                   5,247.79


                                                                       3,617.95



                                                            1,799.92

                                                 935.56
                                     370.29




                                      FY’05      FY’06       FY’07       FY’08      FY’09




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                   PAT (Rs. in Lacs)                                                      EPS (Rs.)
                                              3,309.88
                                                                                                               25.19

                                   2,557.34                                                           21.54



                                                                                          13.29
                        1,217.81                                               10.13

             624.74

   102.25                                                              1.69


    FY’05    FY’06       FY’07      FY’08       FY’09                  FY’05   FY’06       FY’07       FY’08   FY’09




                   Dividend Payout                                                     EBITDA Margins
                                                                                                               31%
                                                                                                       27%

                                                                                          23%
                                   12%          12%
             10%        10%                                                    17%



                                                                       8%

   2.50%



    FY’05    FY’06       FY’07      FY’08       FY’09                  FY’05   FY’06       FY’07       FY’08   FY’09




                      PAT Margins


                                    19%         19%
                        16%

             12%




   2%



    FY’05     FY’06      FY’07      FY’08        FY’09




                                                                                              Annual Report 2008-09    7
                                     ABOUT US MANAGING DIRECTOR’S REV IEW   EXCELLENCE IN UNCERTAINTY




                                    v
                             Our Serv ice Offerings




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Omnitech InfoSolutions is an ISO 9001-2000 certified                  What are our core focus areas?
technology services and solutions provider company in                 Infrastructure management services
the Business Availability and Business Continuity space.              In a scenario where business operations and dominance
The Business Availability services include Infrastructure             are based on the performance, reliability and availability of
Management, Application Management and Performance                    the IT infrastructure, IMS services ensure higher uptimes,
Management services whereas Business Continuity services              increased organisational efficiency and lower operational cost.
include Disaster Recovery Consulting and Management, Data             Infrastructure management services (IMS) encompass all the
Vaulting and Workplace Recovery Services.                             services that relate to monitoring, managing and enhancing
 Omnitech InfoSolutions is also a world-class provider of             performance of a client’s IT infrastructure backbone. These
turnkey IT solutions like Server & Storage Consolidation,             include helpdesk services, server management, data centre
Virtualization, Network Integration Solutions and Data Centre         management, network management, asset management,
Management Solutions, Omnitech provides end-to-end                    desk-side support, IT security services, maintenance services
support with guaranteed SLA (Service Level Agreements) in             and applications operations.
order to optimise infrastructure management and align IT with
                                                                      Remote Infrastructure management services
business goals.
                                                                      These are Infrastructure management services offered
                                                                      through a remote location delivery model. Dedicated
BUSINESS AVAILABILITY SERVICES
                                                                      specialists track, analyse and manage the issues or problems,
What is it?
                                                                      if any from a remote location. Remote monitoring, diagnostics
Business availability includes the range of services and
                                                                      and management solutions are provided through a Network
solutions that enables the client to ensure optimum availability
                                                                      Operation Centre (NOC) which can complement the onsite
and efficiency of IT setup namely; Computing environment,
                                                                      support team. This model is cost effective, highly efficient and
Networking, Application infrastructure at pre or post
                                                                      helps in proactive monitoring of systems and servers with the
deployment stages.
                                                                      help of appropriate tools.
What do we offer?
                                                                      Application management services
We at Omnitech, offer a host of Business Availability services,
                                                                      Application management services are offered, customised
ranging from infrastructure management to application
                                                                      to specific customer application development, deployment,
management to performance management phases. These
                                                                      maintenance, migration and consulting requirements. This
include partnering with our clients to strategise their IT
                                                                      service vertical is offered through a blend of services, aimed at
infrastructure,   implementation      methodology,      change
                                                                      various stages of application life-cycle. These are Application
management, application requirement analysis and testing the
                                                                      Development      Services,     Application   Maintenance     and
performance of the application to deliver the desired output.
                                                                      Enhancement Services and Onsite Consulting Services. We
Based on business needs, we offer value-added services at
                                                                      play an important role though our technology and intellectual
different phases of their IT planning and deployment cycle. Most
                                                                      capital advantages.
importantly we help customers to derive optimum utilisation of
their resources and help to lower the cost of operations.




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Technology Migration Services                                             as Remote Infrastructure Management, Managed Printing,
In order to keep up with the rapid pace of technology, a smooth,          Bandwidth Optimisation, Thin Client, Virtualization and Shared
effective and efficient migration process plays a major role.             Disaster Recovery (DR) is a part of our offerings and ensure IT
While this migration exercise has a potential to affect the               services at optimised costs for the users.
current operations, it also plays a key role in deriving specific
advantages of new technology platforms. Our technology                    Performance Management Services
migration services encompass various layers viz. computing                Performance Management is testing an application to check
environment, connectivity links, operating system, data base              whether it sustains itself under various loads with regard to
management systems, and development & deployment                          concurrent usage, database performance and response to
platforms.                                                                queries, speed, response, heavy data input, etc. Testing is done
                                                                          to determine how quickly a product handles a variety of events
Functional Testing                                                        and it comprises testing applications on various parameters,
Functional testing is an activity based on an analysis of the             executed through the following tests.
specification of the functionality of a component or system. The
functions include Regression, Usability, Security, Supportability,        A test in which the application’s timing profile is monitored,
User Acceptance and Automation.                                           including execution flow, data access, function and system
                                                                          calls to identify and address performance bottlenecks and
Data Centre Management Services                                           inefficient processes. A performance test is generally executed
Omnitech’s     transformational      Data    Center     Consulting        to compare results with either accepted performance
and Management Services prepare your infrastructure to                    benchmarks, which may be universal or empirically derived,
adapt to the changing business environment. Our holistic                  or to benchmark the performance in the environment against
approach to data center services takes into consideration                 third party products.
not just the technology but also business objectives. We work
collaboratively with our clients to ensure 24x7 access to data,           BUSINESS CONTINUITY SERVICES
improved performance, and operational flexibility with minimal
                                                                          What is it?
business disruption.
                                                                          In a business context, IT infrastructure disaster refers to any
IT optimisation services                                                  unplanned interruption of normal business process resulting
The looming economic recession is not only changing priorities            from the disruption of the IT infrastructure components such
around one’s kitchen table, but is also changing priorities of CIOs.      as information systems, networks, hardware and software
In the current scenario, optimising current IT infrastructure and         components, or data itself. These disasters can be related to
resources was the top priority of majority CIOs. Today, CIOs are          technical, people-related, economic and social disasters. The
increasingly asking: Can we do more with less? What have we               losses don’t only limit to financial but also to the productivity
already purchased? What are we actually using? How are we                 and reputation of the companies. In order to keep continuing
using it? Can IT resources be shared between sites? It sounds             business activities, our Company provides disaster recovery
complicated to sort out all these questions, but partnering with          services to our clients to reduce unscheduled downtime,
service providers who offer new age cost saving solutions will            strengthen quality assurance programs, enhance data integrity,
give the answers - quick and easy. The cost saving solution such          and offer total assurances on business continuance.




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What do we offer?                                                       Disaster recovery consulting and auditing
At Omnitech, we offer a range of services to ensure proper              Disaster Recovery Consulting refers to making the company
immunity to the loss of data or business operations in an event         disaster-ready. We at Omnitech, follow the APIDMA
of disaster. We offer seamless disaster recovery plans and              methodology that enables us to do a thorough analysis of the
solutions that enable the companies to remain in the business           clients existing IT processes and policies. A gap analysis is
and ensure seamless continuity and availability of its operations       prepared post identification of critical business function that
and systems. The company’s services include,                            enables us to identifying areas for improvement in the current
                                                                        processes. Post the completion of Business impact analysis
    Data Vaulting Services
                                                                        and recovery time objective, a disaster recovery plan is created
    Infrastructure fail-over services in terms of provision for         adhering to the global best-practices. The same is audited at
    office space, availability of a dedicated equivalent IT set-up      periodic intervals to test its uptime and reliability.
    and continuity of all defined business processes.
                                                                        Data Vaulting Services
    Disaster Recovery (DR) Audit Drills
                                                                        Our Data Vaulting Services provide professional services to help
    DR Consulting and Business Impact Analysis                          you meet the Disaster Recovery/Business Continuity challenges
                                                                        that every organisation faces today. These challenges come in
    Training Services – Awareness, Preparedness, Disaster
                                                                        many forms.
    Management, Business Continuity
                                                                        Most IT environments are comprised of multi platforms and
What are our core focus areas?
                                                                        environments. Our professionals can assist you in sorting
Disaster recovery management                                            through these complexities and help you create a recovery plan
We offer a comprehensive solution in disaster recovery                  that will meet your complex needs and priorities.
management. Our ability to analyse and identify critical business
                                                                        Your tapes, disks and documents, which you think, are critical
processes ensure that the client’s IT systems can be replicated
                                                                        and need an offsite storage solution, we can help you! Your
appropriately and are available quickly in an unforeseen event.
                                                                        tapes and disks are stored in a temperature and humidity
These include relocation and safe storage of all critical data in
                                                                        controlled environment. We can reconcile with lockers and
form of tapes, disks and documents in alternate location and
                                                                        vaults in which we will store your eminent information.
ability to access that data from a workplace.

Also our OmniCenter gives clients the flexibility to operate
seamlessly and continue their normal business operations in
case of a disaster at their location.




                                                                                                            Annual Report 2008-09     11
                                                                  ABOUT US MANAGING DIRECTOR’S REV IEW     EXCELLENCE IN UNCERTAINTY




                                                     Managing Director’s
Mr. Atul M. Hemani                                   Review
HOW WOULD YOU DEFINE THE PERFORMANCE DURING                           HOW DID THE COMPANY EMERGE STRONGER IN WAKE OF
THE YEAR UNDER REVIEW?                                                THE ABOVE MENTIONED CHALLENGES?
I would say the performance has been satisfying. Even though the      While the spending on installing additional IT processes and
numbers may highlight a 30 per cent growth in the topline and         systems were being limited in wake of liquidity pressures, the
the bottomline, the performance becomes special once seen in          need to service existing systems always remained. Moreover,
context to the global environment during the year under review.       the need was to look within the country for opportunities as
In a year of uncertainty and economic volatility, we continued        small and medium enterprises continued to offer a well-etched
to grow – not only in terms of financial performance but also in      scope for offering solutions relating to business availability
terms of clients and contracts entered into. In addition to this      solutions and various delivery models. The Company chose
growth in numbers, what pleased us all is that the company            to concentrate on offering customised services to small and
didn’t lay-off even a single employee during the year.                medium entities and simultaneously concentrate on bigger
                                                                      orders from large players in India. The Company’s proven
WHAT CHALLENGES UNDERLINED THE PERFORMANCE?                           leadership in Business Availability and Business Continuity
The year 2008-09 was challenging in most counts. Globally, it is      provided the ability to offer a comprehensive range of solutions
being considered as one of the most demanding years in decades.       for large businesses in India as well as in Europe.
The impact was also felt industry-wide, with banking and finance
                                                                      Our services also enabled clients to optimise their IT
sector, being the worst impacted. Liquidity pressures coupled with
                                                                      infrastructure and reduce IT costs. We also became a one stop
dampening investor sentiment, resulted in companies deferring
                                                                      shop for our clients offering the entire gamut of services by not
their expansion plans or even limiting their critical expenditures.
                                                                      only making their infrastructure and applications available but
In such an environment, creating business opportunities became
                                                                      also helping them to continue operations in case of disaster.
a big challenge industry-wide.
                                                                      Also our RIMS and Virtual CIO service offerings have helped
In times of global instability, getting quality business became
                                                                      customers to manage their IT setup efficiently and at reduced
tougher, with reputed banks and fund houses globally succumbing
                                                                      costs. This has helped us convert annual contracts into
to the liquidity pressures. For us, a Company that derives close
                                                                      multiyear contracts, as also to create a strong pipeline for the
to 50 per cent of revenues from BFSI segment, ensuring proper
                                                                      next financial year.
receivables in lieu of services offered became a concern.

Besides, with reduced spending of big clients, their retention        DO YOU THINK THIS GROWTH CAN BE SUSTAINED IN THE
was also a challenge that the Company faced, especially in wake       FUTURE?
of competition both from big organised players and smaller            Omnitech is the only reputed organised player to have
players.                                                              integrated presence in Business Availability and Business




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Continuity Services. With years of business knowledge, pool of            The corporate initiatives that we introduced comprised the
experienced professionals, wide range of services and a reputed           following:
clientele, we have been able to strengthen the performance of
                                                                              We focused and expanded our service portfolio in the area
clients’ businesses through our services.
                                                                              of IT resources optimisation to meet up with current needs
DR/BCP has witnessed a surge in the demand since last few                     of customers to reduce the cost of operations without
years owing to the realisation of its importance in a competitive             compensating Quality of Services.
environment. While any downturn in the economy adversely                      We didn’t lay off a single employee as the focus during the
affects the spending on new IT systems and processes; the                     year was to ensure long-term sustainability and not short
demand for maintaining the already established systems                        term cost reduction
largely remain unfazed. IT has been a key enabler and hence IT
                                                                              We focused on stabilising the operations at OmniCentre, a
availability is very critical for businesses and this is where there
                                                                              facility that was commissioned in 2007-08.
will be an ongoing demand to manage IT availability round the
clock with most effective way.
                                                                          HOW DOES OMNITECH EXPECT TO ENHANCE
At the same time, India offers a huge scope in terms of offering          SHAREHOLDER VALUE?
BAS, DR/BCP services to the SME segment, which is virtually               By further strengthening and scaling-up the business. We
untouched by the existing giants. We at Omnitech, feel confident          at Omnitech believe in the combination of an aggressive and
on sustaining this growth momentum because we feel, we cater              de-risked business strategy: value and volume driven growth
to the areas that form the backbone of our clients’ businesses.           in one hand and an effort to reduce funding and operational
Moreover, our product portfolio offers a wide range of products           costs with increased efficiency. This will enable the company to
for every type of customer, enabling us to derive higher repeat           progressively insulate its performance from cyclicality of user
and referral business from our existing clients.                          industries and other factors.

                                                                          Besides, the Company also expects to reward its shareholders
WHAT INITIATIVES DID THE COMPANY TAKE TO CREATE A
                                                                          with a dividend payout that reconciles the Company’s need
STRONGER ORGANISATION?                                                    for plough back with its need to distribute a part of its profits.
There were broadly two kinds of initiatives – the systemic and            During the year under review, the Company has announced 12
the corporate. The former comprised the following:                        per cent dividend for its shareholders, demonstrating its focus
    By controlling our billable and non billable costs                    for enhancing the value in the hands of its shareholders.

    Stringent order approval system on a technical as well as
    commercial angle.




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            In ev ery difficult situation is potential v alue.
            Believ e this, then begin looking for it
                                                                  Norman V incent




                                                                  Annual Report 2008-09   15
                                        ABOUT US MANAGING DIRECTOR’S REV IEW   EXCELLENCE IN UNCERTAINTY




                               am idst challenge
                             s                  s
                          tie
                          i
                        un
       nearthing opport
     U




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When faced with a challenge, one can only do two things – either,
get nervous and wait for things to change; or initiate the change.
We are glad that we chose the latter.


THE SCENARIO                                                            DR/BCP was another area where we held the edge.
In a year when optimism became a difficult word to believe in,          The concept is still at a very nascent stage for Indian
the IT industry was one amongst the worst affected by global            corporate but has been steadily picking up with increased
slowdown. The reasons were obvious – lack of spending from              consciousness for data security and business continuity.
the clients, lower cash inflow, mounting expenses and higher            During 2008-09, we added 11 clients in this segment.
competition. Tight budgets resulted in tighter opportunities.
Increase in revenues resulted in increased debtors. Virtually
every industry was affected adversely by the global juggernaut
of economic slowdown.

THE OPPORTUNITIES                                                       The Omni-edge
While the BFSI sector was adversely affected by the liquidity
                                                                        ESTABLISHED CLIENT RELATIONSHIPS
crunch, we realised that some of the subsectors like insurance
                                                                        Over the last 18 years, we have established broad based
and banking services companies were not hit as hard as
the financial services sector. The first move was to discover           client relationships across the industry segments. These
opportunities to grow in the less-affected segments. As a               relationships can be used to derive additional business
result we concentrated on the insurance and banking sectors             from the existing set of clients as well as enable us
in terms of new business opportunities. In international                acquire new clients in the future.
markets, we focused on Europe where mid market companies
opted to outsource their IT needs to us for reducing their cost         POTENT BLEND OF SERVICES
of operations not only to maintain their profitability but also to      We are one-stop shop in providing complete end-to-end
retain/ increase their customers by offering them competitive           business availability and business continuity services
prices or exports business. We added 12 such clients during             to our customers. These services cater to every IT
the year.                                                               requirement of the client’s business and evolutionary
While the growth plans of companies were being curtailed                stage. Our competence in providing a host of delivery
during the year, the new projects budgets were kept on hold.            models enable us to reach to a diversified base of clients
However, organisations continue spending to manage their                across industries. We provide business availability
existing IT set-ups more effectively. This was a huge opportunity       services by proactive management of IT infrastructure
for us to strengthen the client relationships. We successfully          as well as application management to make IT set up
retained 99.5 per cent of our clients in this space. The total          available for the business at all times. Our performance
BFSI segment contributed 49.5 per cent to our topline during            management services further ensure that IT set up is
2008-09 as against 55 per cent in 2007-08. The total exports
                                                                        available optimally. We offer business continuity services
for the year stood at 30 per cent of the turnover.
                                                                        at all four levels viz., data, equipment, site and people.
During 2008-09, the Company focused on the domestic
business segments and SME segment featured prominently in               INNOVATIVE IP BASED PRODUCTS AND SERVICES
its growth plans. The reason, although not a value segment,             Our ability to decipher the IT requirements of the user
offered a large potential in terms of exploiting volume-related         industries has enabled us indigenously design and create
opportunities. The Company focused on increasing its clientele
                                                                        IT products and tools that serve a value for money solution
in the SME segments in India, by offering them a blend of
                                                                        to our customers. As on 31st March, 2009 we had 6 such
services and customised solutions at affordable price points.
                                                                        IP based products. Some of the major products being
This resulted in the domestic share in the total revenues
                                                                        OmniManage, OmniTransport, OmniAudit, etc.
increase to 78 per cent of the total pie, with SMEs accounting
for nearly 65 per cent.




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18   Omnitech InfoSolutions Limited
MANAGEMENT’S PROFILES   OPERATIONAL REV IEW   FINANCIAL SECTION




             Leadership is unlocking people’s potential to
             become better
                                              Bill Bradley




                                                                  Annual Report 2008-09   19
                                              ABOUT US MANAGING DIRECTOR’S REV IEW   EXCELLENCE IN UNCERTAINTY




                                                                     tial i n t o p
                                                          po     ten




                                                                                                     erf
                                                    n   g




                                                                                                        ormanc e
                                               i
                                            or m
                                       nsf
                                      Tra




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The only difference between the potential and performance is the
stage of evolution. The former is a piece of raw data and the latter is
information. However, the distance between both is considerable and it
only takes a right approach to transform the potential into performance

IDENTIFYING THE POTENTIAL
We at Omnitech, have always believed in exploring new
avenues – in terms of growth, service offerings and intellectual
capital. We were one of the first players to offer comprehensive
solutions in Infrastructure management services. With the
advent of smaller players in the segment, we foresaw the need
to evolve and extend value-added services in the IMS segment.
This resulted in introduction of RIMS, i.e. Remote Infrastructure
Management Services. This was made possible on account
of company’s comprehensive knowledge backed by latest
technology and implementation skills. As a result, we emerged
the only company in the secondary IT sector to offer a holistic
                                                                       The Omni-edge
range of IMS services. Further we added managed services to            FLEXIBLE DELIVERY MODELS
support up to Application Infrastructure level i.e. support for
                                                                       We have adaptive delivery models to suit our customer’s
Middleware, Database and standard applications as well. This
                                                                       specific needs. Our BOT and SaaS delivery models enable
was further enhanced by performance management to offer
                                                                       customers to derive the business benefits rapidly with
capacity planning, load testing, infrastructure and application
                                                                       minimal risks and investments. At the same time these
tuning to get the optimum performance.
                                                                       delivery models allow our clients to get off-shore centre
We also took the inorganic route to expand our service offerings
                                                                       operational much quicker, to get competitive business
thereby adding IP products and extending presence to the
                                                                       advantage and focus into their core business activities.
SME segment. However, our entry into the DR/BCP segment
                                                                       Our expertise into these delivery models and provide high
enabled us to unlock potential opportunity with the large scale
                                                                       end technology center services enable us to provide cloud
companies, with most of them being our existing clientele.
                                                                       computing services – right from consulting, building to
THE PERFORMANCE                                                        managing cloud services which has tremendous potential
Our service offerings enable our clients to perform amidst             of growth in future.
challenges. Our ability to customise applications, manage
performance and offer host of services – from testing to               OMNICENTER FACILITY
implementation to audits, has provided our customers with an           Our Omnicenter facility at Navi Mumbai offers the first
ability to improve efficiencies reduce downtime and enhance            offshore disaster recovery hub in India. It offers NOC, Data
their reputation. As a result, we have become service providers        Vaults, Data Centre, PoC centre, technology labs that are
to some of our much esteemed clients like IT Factory and               fully operational and offer an ideal platform for delivery
Astonfield Renewable Resources Limited.
                                                                       of technology services. Being situated in Mumbai, it has
Our performance should also be seen in context of our strong           a great strategic advantage too in terms of availability of
relationships with globally renowned technology partners like          skills.
IBM, HP, Dell, etc. These partnerships have enabled us to
provide innovative and latest technology based development             TECHNOLOGY DRIVEN AND FOCUSED MANAGEMENT
and deployment platforms.                                              Our Promoters are technocrats having individual
Our performance is also reflective of our people quality. Having       experience of over 20 years in IT industry. Our continued
an employee base of more than 1000 people across India, we             investments into technology space and on-going up
have successfully been able to attract and retain the best talent      gradation of technological skills blended with personal
in the industry. With a young team, having an average age of           attention help us to design and offer technically suitable
28-30 years and experience of 4-5 years, we stop at nothing in         solutions to our customers.
our journey to achieve excellence.



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            We must expect to fail...but fail in a
            learning posture, determined no to repeat
            the mistakes, and to maximise the benefits
            from what is learned in the process
                                                                  Norman V incent




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                                                      a lu e m a x i m i s a ti o
                                                nt ov                             n
                                              i
                                          n
                                      o
                                 a ti
      i n g c o s t o p ti m i s
T urn




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In the time of lower realisations, the companies globally went on a cost
cutting spree. To survive in this environment needed a special effort –
that which married the need to optimise costs and maximise value.

BEING TOMORROW-READY
The downturns and upturns are cyclical while the relationships
need to be long-term. This belief drove our client retention
methodology in 2008-09. We introduced Mission Arjun
in November 2008 as a critical measure to ensure client
retention. We identified that the client’s goal was based on
single agenda of cost reduction. We offered them a potent
combination of long-term solutions coupled with optimised
cost. Being a technology-focused Company, our ability to
decipher and address IT requirements across businesses
enabled us to minimise cost for the clients. This also was made
possible by our existing relationships with renowned vendors.
Each potential client was presented with a long term plan of 3
to 5 years on what would enable them to save costs in their IT
set-up. This initiative yielded instant fruits with us signing more
than 58 clients through this initiative during the year. This also
turned out to be a year where we retained the highest number
of clients in our history. This strategy also helped us to acquire
new clients.

QUALITY FOCUS                                                            The Omni-edge
    Company recognises the importance of Quality of Services,            CLOSE RELATIONSHIP WITH GLOBAL IT COMPANIES
    processes and operations to provide world –class services to         Our close business relationships with global IT companies
    its clients across the globe                                         enable us to adapt innovative technology and acquire the
         New processes and systems are included into ISO                 technical expertise to offer techno-commercially viable
         program                                                         and optimised solutions to our customers.

         Continual Improvement Program is being pursued on an            INDIA ADVANTAGE
         ongoing basis                                                   We bring value to our global customers by utilising ‘India
                                                                         Advantage’ of having right skills, better communication
    We have been constantly striving towards improving the
                                                                         ability, different time zones and a cost-effective execution
    current performance levels and to improve the quality of our
                                                                         and operation model.
    service
                                                                         TECHNICAL SKILLS
    Successfully completed the ISO 9001:2000 Surveillance Audit
                                                                         Technical Skills involve in-depth knowledge of respective
    for 2007-08 with zero NCR
                                                                         technologies. Due to adequate educational background
    We have already started the processes of documentation of            and experience we believe that our employees possess
         ISO 20000                                                       these capabilities and have executed projects on various
                                                                         platforms. To keep our employees abreast of technologies
         ISO 27000
                                                                         we conduct various training programs from time to time.
         BS 25999




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Awards and
Accolades
     Award for excellence in productivity, quality, innovation and management, in the year 1995, by Institute of
     Economic Studies, New Delhi

     Award for Outstanding contribution for the year 1997 from Intel Electronics Asia, Inc.

     Highest Customer Satisfaction Award from IBM in the year 2000

     Most Responsive Partner from IBM in the year 2001

     Competitive Win Back Partner – IBM

     Fastest Growing Partner from VERITAS Software Solutions Private Limited -2002

     Best Commercial Business Partner for West - Tier-II-2002

     Best Managed Service Setup Award from HP-2002

     Best ESG Partner (Western Region) from IBM – 2002

     Outstanding Performance for HP Contract Business 2005

     Award for excellent sales performance in the year 2005 from Tandberg Data

     Awarded by Forbes for “Best Under a Billion” companies in Asia Pacific - 2008

     Awarded by Deloitte for “Fast 500 Asia Pacific 2008 award”

     Awarded as one of the excellent performers in best support by NCR, Canada

     Awarded “Excellence in Silk Test Automation” by NCR at their Global Vendor meet

     Recognised by Citrix for Performance Testing on “Netscaler” Appliance for their one of their customer

     Awarded as Best SME for Corporate Governance 2009 by Business Today




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Board of Directors’
Profiles
                                      MR. MAGANLAL K. HEMANI: Chairman
                                      A businessman, having an experience of over 58 years in varied fields of business
                                      viz. distribution, manufacturing and service industries. His vast experience has
                                      helped our Company immensely. He continues to be a source of motivation for the
                                      Omnitech management team.




                                      MR. ATUL M. HEMANI: Co-Founder & Managing Director
                                      An Electrical Engineer from University of Mumbai having an experience of over 20
                                      years in the IT industry. He is a founder of our Company and had worked for two
                                      years with Hindustan Computer Limited (HCL), prior to promoting this Company.
                                      He is responsible for overall business strategy and direction of the organisation. He
                                      has been instrumental in tying up business relationships with HP, CA and IBM. As
                                      Managing Director, he provides strategic direction to the Company and currently
                                      focuses on designing international business strategy and promotion of outsourcing
                                      services in the areas of infrastructure management, application development and
                                      software testing.




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                                              MR. AVINASH C. PITALE: Co-founder & Executive Director
                                              An Electrical Engineer from University of Mumbai has experience of over 20 years
                                              in the IT industry. He has completed a course in BS15000 and is a DRI certified
                                              professional. He has a rich experience of service delivery on various hardware
                                              and software platforms and has undergone various soft skills programs. He is
                                              also a co-founder of our Company and had worked for three years with Hindustan
                                              Computer Limited (HCL), prior to promoting this Company. He is responsible for
                                              conceptualisation, execution and delivery model set up for various services viz.
                                              infrastructure management services and disaster recovery services. His areas of
                                              specialisation are business continuity planning and infrastructure management
                                              services.


                                              MR. DEVARSHI D. BUCH: Executive Director
                                              An Electrical Engineer from University of Mumbai has experience of over 20 years
                                              in the IT industry. He has undergone various presales and technical certification
                                              programmes. He is a certified executive and has the following certifications

                                                  Intel Certified Solutions Specialist

                                                  Compaq Technical Certified Engineer

                                                  Compaq Storage Works

                                                  Cisco Certified Network Associate

                                                  Cisco Systems Design Associate

                                                  Customer support Certification for Compaq

                                                  LAN-WAN Integration-Core Technologies

                                                  Microsoft-Sales Certification

                                              Prior to joining our Company in 1994, he was working with Minicomp Limited as
                                              Project Manager. His areas of specialisation are sales of solutions/technologies
                                              and products, execution of turnkey projects, providing of IT consultancy in the areas
                                              of enterprise computing, connectivity solutions and server-based solutions, DRP,
                                              securities solutions and many more. He is responsible for developing domestic
                                              business in the area of system integration and services.




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                                      DR. KALIMOHAN J. BHATTACHARYA: Non Executive & Independent Director
                                      Is an M.A. in Economics along with a Ph.D. D.Litt.,CAIIB He has vast experience of
                                      about 40 years in the Banking sector which includes 35 years of service with State
                                      Bank of India at various position including that of the Chief General Manager in the
                                      State Bank of India. He also held the positions as Executive Director with IndusInd
                                      Bank Limited for 1.5 years, Managing Director and CEO with Bank of Rajasthan for
                                      4 years, Nominee Director in Maharashtra State Financial Corporation (MSFC) for
                                      5 years, as Vice President for Rajasthan Chamber of Commerce for 4 years and as
                                      a member of the Government Board, Indian Bank Associations (IBA) for 3 years.
                                      Currently he is Professor & Head of Centre of Banking and Advance Financial
                                      Studies at Institute of Chartered Financial Analysts of India.




                                      DR. RAM K. MANGAL: Non Executive & Independent Director
                                      Has around 20 years of experience in IT industry, in financial, services and
                                      manufacturing domains. In his last engagement as Chief Technology Officer and
                                      Group Head of Kotak Mahindra Bank, Dr Mangal pioneered major initiatives to enable
                                      the bank to implement and be launched with large number of major applications, all
                                      fully integrated, with practically no file movements, no reconciliation needs between
                                      applications, and practically zero operating errors. After starting his own firm,
                                      Kontabs, he formulated the IT strategy for Kotak Bank and continued to advise them
                                      on major initiatives. Earlier, Dr Mangal had headed IT for Grindwell Norton, HDFC
                                      Ltd., Reliance Petroleum, and Thomas Cook. Dr Mangal had also been a faculty at
                                      The University of Memphis, Memphis, Tennessee, USA. He is a Ph.D from The Ohio
                                      State University, USA, MBA from IIM Ahmedabad, and B.Tech. from IIT Kanpur, and
                                      had cleared CISA exams. Dr. Ram K Mangal is on the board of Moores Rowland
                                      Consulting Pvt. Ltd., a Haribhakti Group entity providing Information Systems Risk
                                      Management services.




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                                              PROF. VENKATESHWARAN H. IYER: Non Executive & Independent Director
                                              Engineer by Training, M.Com. (Mysore University),Diploma in Management(JBIMS),
                                              Fellow of IIMM, a Lead Auditor for QMS(IRCA-UK) with 30 years of total experience
                                              in the senior management cadre in well-known organisations including Larsen
                                              & Toubro Ltd., IBM, Rallis India and the house of Mafatlals. He is a winner of the
                                              Best Faculty Award (1996-IMM) and UNITOP Award (1997) for his contribution to
                                              Management Education. He has also been the past Chairman of Indian Institute of
                                              Materials Management (IIMM) and is currently a Member of the Board of Studies of
                                              IIMM. He was earlier on the Governing Board of Bombay Productivity Council and
                                              the Indian society for Training and Development. Presently, since January 1, 2001,
                                              he is a Professor of Operations Management in Welingkar Institute of Management
                                              and Dean of their Management Development Center.



                                              MR. VASUDEVA V. KAMATH: Non Executive & Independent Director
                                              Is a B. Com. (gold medalist) from Mysore University and also a distinction holder in
                                              CAIIB. He has vast experience of about 40 years in the banking sector and has held
                                              various positions in Canara Bank and Canbank Venture Capital Fund Limited. He
                                              commenced his career with Canara Bank in 1966 as an Officer/Accountant and over
                                              a period of time was promoted to various positions. He retired as a Deputy General
                                              Manager and member of the Recovery Committee of the Canara Bank, Recovery
                                              Wing at Bangalore in the year 2006.




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Key Management
Personnel Profiles
                                      MR. ANURAG SHAH: CEO Technology Services,
                                      A computer engineering graduate from Bombay University, with more than 10+ year’s
                                      & experience in the IT industry. He has a Diploma in Business Management and is a
                                      member of the Technical Advisory Board of S.I.E.S. College of Management. He was
                                      the founder of EdVenture Systems Inc. (ESI) which is now a division of Omnitech.

                                      His focus is determining overall business strategy and directions for the Software
                                      Testing and E-Business divisions; building innovative technology solutions and
                                      services; and creating a sustainable skill base within the organisation. It is worth
                                      noting that Anurag has been instrumental in establishing premium relationships
                                      with IBM, Mercury and Borland.

                                      He is also on board of Arham Technologies co., Ltd. which offers Application
                                      Management and Infrastructure Management Services for clients in Japan. Arham
                                      Technologies is a joint venture between Omnitech InfoSolutions Ltd. and Sanwell
                                      Co. Ltd. Japan.




                                      MR. NIKUL SHAH: Senior Vice President
                                      Mr. Shah is a Bachelor of Textile (Technology) from M.S. University, Baroda.
                                      Professional experience of over 38 years at various managerial positions. He was
                                      associated with Mafatlal Group for around 25 yrs and with companies like Morarjee
                                      Mills and Ashima Textiles. He has gained International exposure in Textile Marketing.
                                      From 2002 to 2006 he had been the Promoter and Director of Edventure Systems
                                      Incorporation. He has been associated with the Company since July 2006 as a Senior
                                      Vice President, handling Commercial, HR, Training and Development departments.




                                      MR. MACHHINDRANATH S. TAPARE: Head – Tech Support
                                      Mr. Tapare is a Diploma in Industrial Electronics (Bombay Technical Board). He has
                                      a professional experience of over 15 years, of working in fast-paced environments
                                      that demand strong organisational, technical & interpersonal skills. He is a multi-
                                      task expert as well as an effective team leader and has dedicated experience of four
                                      years in Citrix and Linux Solutions.




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                                          MR. AYAN MITRA: Head - Marketing
                                          Mr. Mitra completed B. Com from Calcutta University in 2001. A seasoned
                                          professional with more than 8 years of experience in Marketing, Strategy, Brand
                                          Communication, Sales & Business Development. His expertise include end-to-end
                                          marketing/business development leadership for IT solutions & services for multiple
                                          geographies. Mr. Mitra has also been associated with developing the marketing
                                          organisation in MNCs and other SMB IT companies. He has been a key influencer
                                          in promoting a marketing function within Omnitech. He drives strategic decisions to
                                          promote public relations.




                                          MR. NILESH THAKKAR: Operations Head – DR/BCP
                                          Mr. Thakkar is a Diploma holder in Computer Technology from V E S Institute of
                                          Technology. A competent IT Professional with over a decade of experience in IT
                                          Project Management, Service Delivery and Data Centre Management. He holds
                                          in-depth expertise in Management, ITIL Based Process Management, 24X7 IT
                                          Infrastructure Monitoring & Management, Service Availability, Performance and
                                          Capacity Monitoring & Management, Data Centre Environment Control, Vendor
                                          Management, Service Level based Management and Governance, Management
                                          of DR and BCP. He also holds technical expertise in Solution’s Architecting &
                                          Delivery (conceptualisation and formation of Business Model). He is a dynamic
                                          leader with proven with proven abilities in building and managing teams, including
                                          performance.




                                          MR. DEEPAK PUSHKARNA: Head - Accounts
                                          Mr. Pushkarna is a Chartered Accountant and a Management Graduate with over
                                          14 years of experience across Accounts, Finance, Auditing and Operations in an IT-
                                          dependent environment. He has demonstrated ability of handling day to day accounts
                                          and including total process up to finalisation of accounts, MIS, auditing and financial
                                          control. Mr. Pushkarna is an exemplary communicator with renowned competence
                                          in networking with statutory authorities and other regulatory authorities.




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                                      MR. AMIT ABHYANKAR: Associate Vice President – DR/BCP & Strategic Sales
                                      Mr. Abhyankar is an Engineering Graduate (University of Pune) and a Management
                                      Graduate (University of Mumbai). He is currently working as Associate Vice
                                      President for Business Continuity Services at Omnitech InfoSolutions Limited. He
                                      has more than 18 years of professional experience, of which 10 years have been in
                                      corporate sales. Before joining Omnitech he has worked in various companies and
                                      handled direct as well as channel sales. He has also headed an entrepreneurial
                                      venture for a few years. Currently, at Omnitech, he heads National sales and new
                                      market development for a completely nascent concept such as Managed Services
                                      for Business Continuity & Disaster Recovery.




                                      MR. AMIT PATIL: Associate Vice President – IMS Sales
                                      Mr. Patil operates in the capacity of Associate Vice President, IMS Sales for last 2
                                      years handling the areas of new business, renewable business and also offering
                                      practice expertise on solutions creation and upscale. He has been associated with
                                      Omnitech for last 10 years and been responsible towards IMS Delivery and Sales.
                                      He is an excellent client relationship manager with process oriented approach with
                                      specialisation in Business Domain Requirement knowhow for FMCG, Hospitality, IT
                                      Services and BFSI segment.




                                      MR. DHANSINGH THAKUR: VP- Commercial
                                      Mr. Thakur is a Commerce graduate, having more than two decades of experience.
                                      He is associated with Omnitech from past 20 yrs. His core expertise has been in
                                      handling logistics. He is responsible for Commercial department operations which
                                      involve Logistics, vendor management and payment collection. He has grown to the
                                      position of VP from Stores in-charge.




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                                              MR. GAURAV SHARMA: Company Secretary & Chief Officer (Compliance & Legal)
                                              Mr. Sharma is a Post Graduate in Commerce and an Associate Member of the
                                              Institute of Company Secretaries of India, New Delhi (ICSI). He has also obtained
                                              National Stock Exchange of India Ltd. - Institute of Company Secretaries of India
                                              (NSE-ICSI) Certification in Corporate Governance. He has an experience of over
                                              5 years in Secretarial, Corporate Laws and Legal Matters. Prior to joining the
                                              Company in 2006, he worked as a Consultant with Lovi Mehrotra & Associates,
                                              Chartered Accountants. He is responsible for handling Secretarial, Compliance &
                                              Legal functions of business and acting as a representative of the Company before
                                              the Regulatory Authorities.




                                              MR. NITIN PUROHIT: Associate Vice President – Technology Services
                                              Mr. Purohit is a Science Graduate having extensive knowledge and experience
                                              of IT Systems and Applications. Over a period of time he has achieved technical
                                              certifications from Microsoft, NIIT, IBM Rational as well as management certifications
                                              from PMI (PMP) and IIQM (CSTM). Prior working with Omnitech Nitin has worked with
                                              Edventure Systems Inc. (Technology Consultant, Head of Technology), Cybershield
                                              (Information Systems Auditor) and NIIT (Senior Trainer). In his current role as an
                                              Associate Vice President – Technology Services at Omnitech he takes care of the
                                              Pre-sales and Delivery functions of Technology Services Division.




                                              MR. SANJAY MISHRA: Associate Vice President – International Sales
                                              Mr. Mishra is a Science graduate from Mumbai University having 10 years of IT
                                              services sales experience in India and abroad. He started his professional career
                                              with Mumbai-based IT Company specialised in Payroll and HR application. He
                                              successfully built up a partner network across the country and managed them
                                              during 4 years of tenure there. He joined Omnitech in 2003, to manage the IT
                                              services sales in Mumbai and Pune, with specialised in managing the turn key
                                              solutions for government and Semi Government institutes. In 2006 moved to explore
                                              the international business for Omnitech in Europe and Middle East region. Today he
                                              has been instrumental in establishing an excellent business network in Belgium,
                                              Netherlands and Germany.




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Management Discussion
and Analysis


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ECONOMIC REVIEW                                                        the industry is steadily expanding to Continental Europe
The global economic conditions deteriorated sharply during the         in particular growing at a CAGR of over 51 per cent over
year 2008-09 with several advanced economies experiencing              FY2004-2008
their sharpest declines. The associated adverse shocks spread
                                                                       Domestic IT market (including hardware) reached USD
across emerging market economies (EMEs) particularly by the
                                                                       24.3 billion in 2008-09 as against USD 23.1 billion in
third quarter of the year and accentuated the synchronised
                                                                       2007-08, a growth of 5.3 per cent. Hardware grew at 2.6
global slowdown. Inflation conditions witnessed sharp volatility
                                                                       per cent; Software and services spending supported by
during the year as headline inflation in major advanced
                                                                       increasing adoption, grew by almost 8 per cent
economies firmed up considerably up to July 2008, but declined
sharply thereafter. The global financial environment entered a         Exports - Contributing 66 per cent to the overall revenue
crisis phase in mid-September 2008, following the growing              aggregate, exports remained the mainstay of the Indian
distress among large international financial institutions.             IT-BPO growth story. Software and services exports,
                                                                       accounting for over 99 per cent of the total exports,
India – the third largest economy in Asia, is estimated to have
                                                                       reached USD 47 billion and directly employed over 1.7
grown less than 7 per cent in 2008-09, after growing at an
                                                                       million professionals in 2008-09
average rate of around 9 per cent or more in three fiscal years
to March 2008. This was on account of a global economic                     Broad-based growth across all the segments of IT
downturn and a contraction in domestic demand.                              services, BPO, Software products and engineering
                                                                            services, is reinforcing India’s leadership as the key
INDUSTRY OVERVIEW                                                           sourcing location for a wide range of technology
Global Market                                                               related services with Increasing traction in RIM
     Software and services touched USD 967 billion, an above                & Application management and widening service
     average growth of 6.3 per cent over past year                          portfolios

     Worldwide BPO grew by 12 per cent, the highest among all               BPO services exports, up 18 per cent, was the fastest
     technology related segments                                            growing segment across software and services
                                                                            exports driven by scale as well as scope. BPO service
Indian Performance                                                          portfolio was strengthened by vertical specialisation
     Indian IT-BPO grew by 12 per cent in 2008-09 to reach                  and global delivery capabilities
     USD 71.7 billion in aggregate revenue
                                                                            Complementing the strong growth in IT services
     Software and services exports (includes exports of IT                  and BPO exports was the continued growth across
     services, BPO, Engineering Services and R&D and Software               Software product development and engineering
     products) reached USD 47 billion, contributing nearly 66               services, which also reflected India’s increasing role
     per cent to the overall IT-BPO revenue aggregate. IT-BPO               in global technology IP creation. Export revenues
     exports (including hardware exports) reached USD 47.3                  from services such as engineering and R&D, offshore
     billion in 2008-09 as against USD 40.9 billion in 2007-08,             product development and made-in-India software
     a growth of 16 per cent                                                products grew at 15 percent, and clocked USD 7.3
     While the US (60 per cent) and the UK (19 per cent)                    billion in 2008-09.
     remained the largest IT-BPO export markets in 2007-08,




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Indian IT-BPO Industry – Sector-wise revenue break-up

 USD billion                                                       FY 2005       FY 2006          FY 2007    FY 2008         FY 2009E
 IT Services                                                           13.5           17.8           23.3         31.0           35.2

 -Exports                                                               10.0          13.3           17.8          23.1          26.9

 -Domestic                                                               3.5           4.5            5.5           7.9           8.3
 BPO                                                                     5.2           7.2            9.5         12.5           14.8

 -Exports                                                                4.6           6.3            8.4          10.9          12.8

 -Domestic                                                               0.6           0.9             1.1          1.6            1.9
 Engineering Services and R&D, Software Products                         3.8           5.3            6.5          8.6            9.5

 -Exports                                                                3.1           4.0            4.9           6.4           7.3

 -Domestic                                                               0.7            1.3            1.6          2.2           2.3
 Total Software and Services Revenues                                  22.5          30.3            39.3         52.0           59.6

 Of which exports are                                                   17.7          23.6            31.1        40.4           47.0
 Hardware                                                                5.6           7.1            8.5         12.0           12.1

 -Exports                                                                0.5           0.6            0.5          0.5            0.3

 -Domestic                                                               5.1           6.5            8.0          11.5           11.8
 Total IT Industry (including Hardware)                                28.1           37.4           47.8         64.0           71.7

Notes:

E: Estimates
Figures may not add up due to rounding off.
Source: NASSCOM


RIMS/IMS                                                              by NASSCOM-Mckinsey, By 2013, the global RIMS market is
Infrastructure Management (IM) refers specifically to the             likely to grow fourfold to nearly USD 26-28 billion per annum
management of the IT infrastructure and includes services like        out of which India would be able to capture more than 50 per
network management, desktop management and application                cent of the total market.

portfolio management. IM has been growing at 50 per cent              RIM is a mission critical service requiring sophisticated tools
year-on-year for IT companies. Infrastructure management              and reflects high customer confidence and relationships. By
(IM) services is emerging as one of the fastest growing service       increasing RIM services the Indian IT industry is moving towards
lines for IT companies spurred by falling telecom costs and web-      becoming a fully-integrated service provider. After ADM and
enabled tools that make remote management easier. The IMS             BPO, the RIM industry opens up yet another big opportunity for
industry currently accounts for USD 524billion. Driven by cost        Indian players to reposition themselves in the global market
                                                                      and to move up the value chain from not just being a cost and
pressures, telecom and technological advancements, there is
                                                                      intellectual leader to a true transformation leader.
a major shift towards RIMS within IMS. As per the recent report




                                                                                                         Annual Report 2008-09      39
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Growth Drivers for the industry                                      The primary objective of such a strategy is to mitigate losses
     The benefits of remote infrastructure management can            and resume business operations. Analysts say that the top 10 IT
     be considerable—Fortune 50 companies, with budgets of           companies have a disaster recovery plan in place, but smaller
     USD 2 billion, can save as much as USD 500 million of their     players are not well equipped to handle disaster efficiently, as
     IT infrastructure budgets, mostly from labor savings .          their ability to spend is less and their clients do not expect it

     Disruptions in core IT systems during the transition            from them. IT and ITeS companies plan for customer services
     or ongoing operations have real financial and security          in the wake of a disaster. They continue their operations from
     costs, including possible data loss and the interruption of     the client’s perspective and this plan is put in place before the
     operations.                                                     order is given to the vendor.

     Regulatory problems, such as the possibility of giving              Business Continuity Services represent a $3 billion to $4
     third parties inadvertent access to confidential medical            billion business, according to Gartner.
     records, and of financial fraud or intellectual-property (IP)       Some 28 percent of companies manage their business
     theft when vendors gain full access to corporate systems.           continuity plan with the assistance of an external provider,
     Increasing demand for virtualisation and Rising realisation         according to a survey of 254 senior executives by consulting
     about economic viability of RIM.                                    firm KPMG.

     In this phase of economic slowdown, a Company’s IT                  There is a higher reliance on external support—38
     spend is likely to be directed in favour of IMS/RIMS to             percent—in midsize enterprises, and the financial services
     reduce costs as well as increase efficiency of the current          sector showed the highest preference for external service
     IT infrastructure.                                                  providers at 41 percent.

     Even the Vendors are pushing IMS/RIMS due to higher                 Nationally there are about 4,500 certified business
     profitability and price resistance.                                 continuity consultants, according to DRI International.

DR/BCP                                                               Application & Performance Management
In today’s global environment, companies increasingly need a         Even as the economic downturn takes its course, customers
competitive edge to maintain profitability and stay in business;     will look to service providers for an efficient and optimised
improved availability and outage avoidance become vital to           applications road map toward the future.
their success. A Well-planned business continuity/disaster
                                                                     Hosted application management (hosted AM) spending is
recovery solution becomes critical to any organisation as it’s
better to plan for incidents, which may affect business, rather      expected to slow in 2009, with worldwide growth adjusted

than taking steps after a crisis occurs. Also with more and          down from about 17 per cent to 14 per cent. While all regions

more Indian companies going global, there is an increasing           are impacted, growth is expected to return more quickly as
need to comply with the international standards and norms.           opex hosting will still be considered an attractive alternative to
With rising pressure from international customers about              capex spending. Moreover, adoption of vertical hosted platform
businesses being made available 24X7, it becomes more                solutions has been gaining traction in spite of this turbulent
critical for companies to have a robust DR/BCP plan in place         economic environment.
so that in case of a breakdown operations are brought back to        This IDC study presents a forecast for the worldwide and U.S.
normalcy within hours.                                               application management (AM) services market for the period
Business Continuity (BC) is a management process that                2009-2013. While discrete AO services spending reached an
provides a framework to ensure the resilience of a business to       estimated $34.5 billion in 2008, a slowdown is forecast across
any eventuality, to help ensure continuity of service to their key   the regions, beginning in 2009. At a global level, IDC estimates
customers and the protection of their brand and reputation. It       that AO services will slow to 6.4 per cent growth in 2009, down
provides a basis for planning to ensure long-term survivability      from previous forecasts of 8 per cent. A rather slow steady
following a disruptive event.                                        upward trending in the forecast will begin in 2010.




40    Omnitech InfoSolutions Limited
 MANAGEMENT’S PROFILES           OPERATIONAL REVIEW         FINANCIAL SECTION




                                Worldwide IT Cloud Services Spending* by Product/Service Type
                                                                      2008, 2012

                                        Business Application 56%                                                               Business Application 52%

                                        Storage 5%                                                                             Storage 13%

                                        Server 9%                                                                              Server 8%

                                        App Dev & Deployment 11%                                                               App Dev & Deployment 9%

                                        Infrastructure Software 18%                                                            Infrastructure Software 18%




              2008                                                                                  2012
           $16.2 billion                                                                         $42.3 billion

* Includes enterprise IT spending on Business Applications, Systems Infrastructure Software, Application Development & Deployment Software, Servers and Storage
Source: IDC, October 2008


INDUSTRY OUTLOOK                                                                       SMBs are expected to emerge as a significant opportunity
     The global technology related spending is expected to                             due to lower IT adoption currently.
     reduce for the first 2-3 quarters of 2009 on account of the
                                                                                       Lack of working age population in the developed economies
     downturn but is expected to pick up in 2010.
                                                                                       and a significant long term cost arbitrage indicates India’s
     Greater focus on cost and operational efficiencies in the                         sustained cost competitiveness.
     recessionary environment is expected to enhance global
                                                                                       Service providers are expected to enhance focus to
     sourcing. Outsourcing is not only decreasing costs for the
                                                                                       domestic market to de-risk business and tap into the local
     companies but also improving operational efficiencies.
                                                                                       growth opportunities.
     There would be pricing pressures coupled with contract
     renegotiations due to the economic uncertainty. India Inc                         India Inc. is likely to increase its focus on developing a
     would remain focused on tactical measures to achieve                              comprehensive risks framework and identify steps in
     cost savings and greater productivity.                                            managing them.

     Services and software segments are estimated to cross
                                                                                  COMPANY OVERVIEW
     USD 1.2 trillion by 2012. This is more than the 5.2 per cent
                                                                                  Omnitech InfoSolutions Limited is an integrated IT services
     growth expected in the total IT spending.
                                                                                  Company having presence across Business Application,
     The worldwide BPO market is expected to grow at a CAGR                       Performance & Application Management and Business
     of 11.9 per cent to reach USD 181 billion by 2012, while ITO                 Continuity Services. The Company’s performance can be briefly
     market is expected to grow at a CAGR of 6.9 per cent and                     discussed as follows:
     reach USD 275 billion by 2012.
                                                                                       The Company’s total revenues increased by 31 per cent
     The huge potential for global sourcing is further highlighted                     from Rs. 132.63 cr in 2007-08 to Rs. 173.61 cr in 2008-09
     by an addressable market size of USD 500 billion in 2008,
     which is more than five times bigger than the current                             The net profits increased by 29 per cent from Rs. 25.57 cr

     market.                                                                           in 2007-08 to Rs. 33.09 cr in 2008-09

     Increasing focus on virtualisation and decreasing costs of                        The EPS increased by 17 per cent from Rs. 21.53 in 2007-
     virtualisation is an added boon for the sector.                                   08 to Rs. 25.19 in 2008-09




                                                                                                                           Annual Report 2008-09             41
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SWOT ANALYSIS                                                     the matters specified for Audit Committee under Clause 49
Strengths                                                         of Listing Agreement which, interalia, include overseeing the
    Created a niche space for itself in the industry              Company’s financial reporting process, reviewing periodic
                                                                  financial results, financial statements, internal control and
     Over 70 per cent of the revenues accrue from high margin
                                                                  internal audit systems, accounting policies and practices,
     services
                                                                  related party transactions and performance of internal and
     Strong Clientele Relationships                               external auditors.

     Flexible Delivery Models                                     The committee also holds discussions with statutory auditors,
                                                                  internal auditors and the management on matters pertaining to
     Business Alliances and Tie-ups
                                                                  internal controls, auditing and financial reporting periodically.
     Quality processes and initiatives
                                                                  The Company has engaged Audit Firm for carrying out internal
     Proven methodology and approach                              audit on monthly basis. The scope of internal audit covers the
     Technology driven and focused Management                     processes of all the segments of the Company which includes
                                                                  FM/AMC, Trading & Logistics, Technology Services, Payroll,
     Innovative IP based products and services
                                                                  physical verification of stocks, payment of statutory dues etc.
     Ability to provide end to end solutions                      The observations made by the auditor are circulated to the
                                                                  Concerned Department personnel.
Weakness
   Small in operations                                            On monthly basis, meeting is held with internal auditor, wherein
                                                                  all the department personnel and the Company Secretary take
     Less international presence
                                                                  participation. In the meeting, observations made by auditors
Opportunities                                                     are discussed and the department personnel are asked what
   Increased acceptance of outsourcing as a viable business       measures they have taken to rectify the discrepancies. Further,
   strategy                                                       if any serious discrepancy is found out by the internal auditors
                                                                  during their audit, which requires immediate attention of
     Customer need for new and innovative solutions and
                                                                  Management, the same is brought to the notice of the Company
     services in order to reduce costs and improve efficiencies
                                                                  Secretary, who has been entrusted with the task of looking after
     Companies have cut down their growth plans due to the        internal audit function and immediate action is taken thereon.
     economic turmoil but there is a need to maintain the
                                                                  Further it is to be stated here that at present, the Company
     existing infrastructure more efficiently
                                                                  has ISO 9001-2000 Certification. The Company has initiated
     Inorganic growth opportunities (acquisitions)                the process for ISO 27001 Certification, which requires the
                                                                  Company to follow much more systematic processes. ISO 27001
Threats
                                                                  Certification will certainly help the Company to strengthen its
    Attrition in employees
                                                                  existing internal control systems.
     Competition from the big players
                                                                  HUMAN RESOURCES
     Exchange rate Fluctuations
                                                                  The human capital is the most essential asset in an IT industry.
     Further deterioration of global economy                      The success of IT Company depends on its ability to attract and
                                                                  retain skilled and qualified personnel. That is why we focus on
INTERNAL CONTROLS                                                 developing the skills of each employee in the Company. As on
The Company has an audit committee consisting of three
                                                                  31st March, 2009, our total HR strength was 773 members
directors as its members. The said committee is chaired by an
                                                                  comprising of 605 Technical Professionals and 168 Support
Independent Director and has another Independent Director as
                                                                  staffs. The Company has a blend of young and experienced
member.
                                                                  personnel, with the average age being 28-30 years and the
The role and terms of reference of the Audit Committee covers     average experience being 4-5 years. The very fact that the




42    Omnitech InfoSolutions Limited
 MANAGEMENT’S PROFILES      OPERATIONAL REVIEW   FINANCIAL SECTION




Company has been floated and managed by technocrats who have been in the industry since last 20 years, has lend a sense of
professionalism and a culture of performance throughout the organisation.

Training and development is an intrinsic reason for Company’s growth. The Company has actively initiated various programs for
every employee in order to hone each one’s skill, expertise and efficiency. During the year under review, the Company spent 1,779
man-hours in training initiatives across the organisation. A total of 230 certifications were done during the year.

The Company also encourages the personal development of its employees by providing an adequate platform for creativity,
expression and social initiatives.

FINANCIAL REVIEW
Key Ratios

Particulars                                                                                    2008-09                2007-08
Growth Ratios (In Per Cent)
Total Revenue Growth                                                                                  31                     70
Net Profit Growth                                                                                     29                     110
EPS Growth                                                                                            17                     66
Operating Ratios (In Per Cent)
Export Sales to Total Income                                                                          30                     22
Taxation to Total Income                                                                               5                       4
Dividend Payout Ratio (Excluding Dividend Tax)                                                         5                       6
Profitability Ratios (In Per Cent)
Ebitda Margins                                                                                        30                     26
Operating Profit Margin                                                                               38                     34
Net Profit Margin                                                                                     19                      19
Return on Capital Employed                                                                            27                     28
Return on Equity (No. of Times)                                                                     2.52                    1.95
Liquidity Ratios (No. of Times)
Cash and Bank Balance to Total Assets                                                              0.016                  0.040
Cash and Bank Balance to Current Liabilities                                                        0.171                 0.436
Current Ratio                                                                                      5.526                  4.470
Quick Ratio                                                                                        4.684                  3.947
Debt/Equity Ratio                                                                                   0.01                    0.04
Interest Coverage Ratio                                                                            16.20                   16.47
Market Value Ratios
Dividend Yield (In Per Cent)                                                                           3                       1
Price Earning Multiple (No. of Times)                                                              1.483                  5.968
Eps (Rs.)                                                                                          25.19                   21.53
Ev/Ebitda (No. of Times)                                                                             1.51                   5.16
Ev/Sales (No. of Times)                                                                             0.46                    1.40
Activity Analysis Ratio (No. of Times)
Asset Turnover Ratio                                                                                0.94                    1.07
Receivables Turnover Ratio                                                                          3.66                    4.35
Receivables (In Days)                                                                              99.68                   83.91
Inventory Turnover Ratio                                                                            5.74                   11.02




                                                                                                    Annual Report 2008-09     43
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Share Capital                                                       Deferred Tax Liability
Omnitech has only one class of shares – equity shares of face       The Company reported cumulative net deferred tax liability
value of Rs. 10 each. The Company’s authorised share capital        of Rs. 658.85 Lacs as against Rs. 281.42 Lacs incurred in the
is Rs. 2,000 Lacs, sub-divided into 200 Lacs shares of Rs. 10       previous financial year. Deferred Income taxes reflects the
each. The paid up capital of the Company is Rs. 1,313.92 Lacs       impact of current year timing differences between taxable
divided into 131.39 Lac shares of Rs. 10 each. During the year      income and accounting income for the year and reversal of
under review there was no fresh issue of shares.                    timing differences of earlier years. The differences that result
                                                                    between the profit considered for income taxes and the profit
Reserves & Surplus
                                                                    as per the financial statements are identified, and thereafter
During the year under review, the Share Premium Account
remained same as there was no fresh issue of shares.                a deferred tax asset or deferred tax liability is recorded for
                                                                    timing differences, namely the differences that originate in
The Company credited Rs. 85 Lacs from profits to General
                                                                    one accounting period and reverse in another, based on the
Reserves. The balance retained in Profit & Loss Account post
                                                                    tax effect of the aggregate amount being considered. The tax
appropriation for proposed Dividend and Dividend Tax was Rs.
                                                                    effect is calculated on the accumulated timing differences at
3,040.41 Lacs.
                                                                    the end of an accounting period based on prevailing enacted
Equity Share Warrants                                               or substantially enacted regulations. Deferred tax assets
During the year under review, the Company issued 1,325,000          are recognised only if there is reasonable certainty of their
convertible warrants of Rs. 10 each. The warrants are               realisation and are reviewed for the appropriateness of their
convertible into shares at a premium of Rs. 155.51 per share        respective carrying values at each balance sheet date.
and the conversion ratio is 1:1 for the same.
                                                                    Secured Loans
The amount brought forward by the warrant holders was 10 per        During the year under review, there was a net increase of Rs.
cent of the conversion price i.e. Rs. 165.51 per share as per the   1,467.46 Lacs in Secured Loans. This increase was mainly due
provisions of SEBI guidelines on Preferential Allotment.            to raising of additional working capital facility.


Fixed Assets
                                                                                                                         (Rs. In Lacs)
 Assets                                                              2008                          2009         Growth (in per cent)
 Buildings                                                             261                           265                         1.53
 Leasehold Land at MIDC                                                133                           133                         0.00
 Leasehold Land at Pune                                                284                           284                         0.00
 Office Equipments                                                      27                            38                        40.74
 Software & Software Products                                           36                            36                         0.00
 Computer Systems                                                    3,798                         7,394                        94.68
 Furniture & Fixtures                                                  556                           572                         2.87
 Vehicles                                                               29                            29                         0.00
 Business Acquisition                                                   46                            46                         0.00
 Total                                                               5,170                         8,797                        70.15
 Less Accumulated depreciation                                        1,212                        2,007                        65.59
 Add: Capital WIP                                                      997                           793                      (20.46)
 Net Block                                                           4,954                         7,582                       53.05




44       Omnitech InfoSolutions Limited
 MANAGEMENT’S PROFILES       OPERATIONAL REVIEW     FINANCIAL SECTION




The increase in Computer systems and office equipments was mainly due to investments made in:

1)     Disaster Recovery Center in Navi Mumbai

2)     Network Operations Center (NOC) to meet the increasing demand in RIMS space

3)     WebSphere Competency Center which is revolving around the IBM family of products and also has been a key driver for the
       Company

Investments

                                                                                                                             (Rs. In Lacs)
 As on 31st March                                                             2009                  2008            Growth (in per cent)
 Short Term Investments                                                 1,341.14                 1,928.46                          (30.60)
 Long Term Investments                                                        48.81                296.89                          (83.22)
     Total                                                              1,389.96                 2,225.36                          (37.54)

Short term investments consist of IPO funds invested in short                  from Rs. 13,156.36 Lacs. Export sales recorded a growth to
term/Liquid funds. Decrease in Short Term Investments was                      Rs. 5,212.95 Lacs from Rs. 2,907.13 Lacs which is higher by
due to deployment of IPO funds towards the objectives of the                   79 per cent.
IPO.
                                                                               Other Income also recorded a substantial growth to Rs.
Long term investments consist of investments made in                           218.51 Lacs from Rs. 107.90 Lacs which is up by 103 per
subsidiaries and Joint Ventures. Decrease in Long term                         cent. This was mainly due to dividend received on Short term
investments was due to sale of investment made by the                          Investments which were made out of the IPO Funds.
Company in DRC Gulf WLL, Bahrain. This was due to lack of
                                                                        Expenditure Analysis
profitability in that business.
                                                                        Total Expenditure increased to Rs. 9,890.54 Lacs from Rs.
Current Assets                                                          12,388.23 Lacs, an increase by 25 per cent. Increase in Total
The Company’s gross Debtors outstanding position stood at               Expenditure was mainly due to the following reasons:
Rs. 5,849.12 Lacs, up from Rs. 3,514.38 Lacs last year. Debts
                                                                        i.     Increase in Administrative Cost by 50 per cent.
to the extent of Rs. 3,329.58 Lacs were outstanding for a period
of over six months which was mainly due to the extension of             ii.    Increase in Financial Cost by 54 per cent, which was mainly
credit period given to the international clients because of the                due to additional interest and processing cost incurred on
economic slowdown.                                                             additional working capital facility raised during the year.

Cash and bank balance decreased significantly from Rs. 494.31           Depreciation was higher at Rs. 795.01 Lacs from Rs. 372.23 Lacs,
Lacs to Rs. 284.93 Lacs. It was mainly due to the deployment            which was mainly due to significant increase in the Fixed Assets,
of cash in Working Capital because of increase in cash blocked          which have increased by 70 per cent.
in Debtors.
                                                                        Profit Analysis
Current liabilities & Provisions                                        Net Profit before tax increased to Rs. 4,177.89 Lacs from Rs.
Sundry creditors decreased from Rs. 682.10 Lacs to 518.75               2,999.77 Lacs, higher volumes helped the company post a 39 per
Lacs.                                                                   cent rise in Profit before Tax. Company made a Tax provision of
                                                                        Rs. 868 Lacs for the current year as against Rs. 442.42 Lacs for
The company provided Rs. 184.46 Lacs for final dividend and             previous year.
dividend tax which is same as that of previous year.
                                                                        Profit after Tax showed an improvement by 29 per cent at Rs.
Revenue Analysis                                                        3,309.88 Lacs. The drop in the growth percentage is mainly due to
   Total Gross Income recorded a growth to Rs. 17,361.13                the significant increase in deferred tax provision.
   Lacs from Rs. 13,262.54 Lacs which is higher by 31%.
                                                                        Basic as well as Diluted earnings per share stood at Rs. 25.19 as
       Total Sales were substantially higher at Rs. 17142.62 Lacs       against Rs 21.53 in the previous year, an increase by 17 per cent.




                                                                                                             Annual Report 2008-09      45
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CORPORATE SOCIAL RESPONSIBILITY                                            Over the years, the Company’s measures have resulted
The Company believes that society is one of its important                  in dependence on its top ten clients as a proportion of
stakeholders and approaches its social responsibility as                   revenues from 66 per cent as on 31st March, 2007 to 53
a corporate citizen. Reaffirming its role as a contributing                per cent as on 31st March, 2009.
member of the social and economic milieu it occupies, the
                                                                       Liquidity risk
Company aligns its business operations with social values. As
                                                                       The Company’s inability or delay in realising its receivables
a responsible corporate citizen, the Company is committed to
                                                                       from the clients may lead to short-term liquidity constraints or
extend its hand to the under privileged in areas of education,
                                                                       shortage in working capital funds.
healthcare, etc.
                                                                       Risk mitigation
As a part of Corporate Social Responsibility the company took
                                                                           The Company follows a system of recognising and realising
the following initiatives:
                                                                           incomes from the project at various stages to ensure
     The company has come out with a booklet which contains                proper liquidity.
     guidelines on how to act in case of emergency such as
                                                                           The Company proactively initiated a system of balancing
     fire, earthquake etc. The Company has distributed the said
                                                                           the receivables and reason for delays through a system of
     booklet to all its employees and other people so that the
                                                                           client confirmation.
     awareness can be spread to every house hold.
                                                                           During the year 2008-09, the Company faced some delays
     The company organised a Blood Donation Camp and free
                                                                           in realising client dues, mainly on account of lack of
     eye check up for its employees.
                                                                           liquidity throughout the BFSI segment.
     The company helped the old age home as well as
                                                                           However, the Company registered a bad debt of less than
     orphanage in monetary as well as non-monetary terms.
                                                                           46 per cent, reflecting the stringent credit quality.
     The Company has also taken up the initiative of ‘Go Green’
     where the company actively participates in Tree Plantation        Attrition risk
     and optimising the use of electricity and water.                  The company is a part of an intellectual capital driven industry.
                                                                       The company’s business depends largely on its ability to attract
RISK REVIEW                                                            and retain employees with adequate skill sets.
Revenue concentration risk
                                                                       Risk mitigation
The company’s top five clients account for 32 per cent of its
                                                                           The Company has ensured a performance driven culture
total revenue. Any attrition in the clientele will result in adverse       across its organisation to promote the right talent as well
financial condition of the Company.                                        as to reward their achievements.

Risk mitigation                                                            The Company has a well-set up training and development
     The Company operates in a niche space where the focus is              wing that caters to infusion of multi-skills among the
     on maximising revenue per customer.                                   employees and also ensures transfer across functions.

     The Company has a diversified clientele across its business           The top management of the company has been with the
     verticals.                                                            company since its inception.

     The Company has enjoyed long-term relationships with its              The attrition at the senior management level has been at
     clientele, with the average relation period being 6 years             negligible levels.
     with its top 10 clients.
                                                                           In an overall attrition level of 5 per cent, the attrition was the
     The Company has added 31 new customers during the                     highest among employees who were with the organisation
     year under review,                                                    for six months or less.




46     Omnitech InfoSolutions Limited
 MANAGEMENT’S PROFILES        OPERATIONAL REVIEW       FINANCIAL SECTION




Vendor dependence risk                                                     Competition risk
The Company’s contract with the clients may involve products,              The Company operates in a highly competitive environment of
hardware and services of third party vendors. In case of any lack          IT services, and face competition from the organised giants as
of quality at the vendor’s end, the reputation of the company              well as the unorganised players.
can be adversely affected.
                                                                           Risk mitigation
Risk mitigation                                                                The Company has formed a reputation in the niche space
     The Company works with reputed vendors like IBM, HP                       of BAS and BCP services.
     and Microsoft.
                                                                               Being of a smaller size in comparison to the global and
     Most of the vendors have been with the Company since                      domestic IT giants, the company has focused on IT
     last 5-6 years, reflecting upon the strength and quality of               requirements of SME segment, that is virtually untouched
     the partnership.                                                          by the competition.

     The Company ensures quick replacement/service from its                    The Company’s ability to offer customised solutions to the
     vendors in case of any quality issues with the products and               smallest of clients to the largest of brands has enabled it
     services provided by them.                                                to create an entry barrier for the competition in the DR and
                                                                               BCP space.
     On account of quality consciousness, the Company only
     works with selected brands and vendors, even if they                  Compliance risk
     command a premium over other local players.                           Omnitech is a public limited company listed on both NSE and
                                                                           BSE, which makes it mandatory to comply with various statutes.
Technology obsolescence risk
                                                                           So non compliance of any of the provisions of any statutes will
In a dynamic industry, the inability to adapt and use latest
                                                                           attract penal provisions thereby hampering the image of the
technology could lead to lower efficiency of the system and
                                                                           Company and also incurring monetary loss.
client attrition.
                                                                           Risk mitigation
Risk mitigation
                                                                               The Company has a compliance officer who ensures
     The Company’s tie up with globally reputed vendors enable
                                                                               that company is not in violation of any of the applicable
     it to have a hands on knowledge of the latest technology in
                                                                               statutes. The compliance officer reports to the Board of
     the computing and storage verticals.
                                                                               Directors from time to time on the compliance or otherwise
     The main consideration for the Company is not just to                     of various laws.
     employ latest technology but also to ensure efficient
                                                                               The Company also consults independent Legal advisors
     technology at optimum cost and lower servicing
                                                                               wherever necessary to ensure statutory compliances.
     requirements.

     The Company’s experience in the industry coupled with its
     ability to assess the client requirements have enabled it
     to use a blend of technologies and products customised
     to the client requirements relating to system usage,
     efficiency, safety, capacity as well as financial viability.

     The Company’s key differentiators have been its ability
     to create services using technological platform. It has
     pioneered Business Availability and Business Continuity
     Services and is the only one in the SMB space to provide
     complete 360 degree solution.




                                                                                                              Annual Report 2008-09     47
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48   Omnitech InfoSolutions Limited
MANAGEMENT’S PROFILES   OPERATIONAL REV IEW   FINANCIAL SECTION




                                         Directors’ Report




                                                                  Annual Report 2008-09   49
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The Members of
Omnitech InfoSolutions Limited

Your Directors have pleasure in presenting the nineteenth Annual Report together with the audited accounts of the Company for
the year ended 31st March 2009.
I.    FINANCIAL HIGHLIGHTS
                                                                                                                    Rupees In Lakhs
       PARTICULARS                                                                                2008-09                  2007-08
       Income from Operations                                                                      17,142.62                13,156.36
       Profit before Interest, Depreciation and Tax (PBIDT)                                        5,247.80                  3,565.97
       Interest                                                                                      274.90                    193.97
       Depreciation                                                                                  795.01                   372.23
       Profit before Tax (PBT)                                                                     4,177.88                  2,999.77
       Provision for Taxation including FBT & Deferred Tax                                           867.99                   442.43
       Profit after Tax (PAT)                                                                      3,309.89                  2,557.34
       Balance brought forward from previous year                                                   4,110.19                 1,844.92
       Amount Available for Appropriation                                                          7,420.08                  4,402.26
       Appropriations:
       Proposed Dividend                                                                              157.67                   157.67
       Dividend Tax                                                                                   26.80                    26.80
       General Reserve                                                                                85.00                    65.00
       Provision for Gratuity                                                                              -                   20.65
       Provision for Leave Encashment                                                                      -                    21.95
       Balance Carried Forward to Balance Sheet                                                   7,150.61                   4,110.19


II.   REVIEW OF PERFORMANCE                                                   Net Profit after tax (PAT) for the year was Rs. 3,309.89
      a.   Operating Results:                                                 Lacs as compared to Rs. 25,57.34 Lacs in the previous
           Your Company continued to achieve strong and desired               year, thereby an increase of 29.43 per cent.
           growth in the financial year 2008-09 into international
                                                                         b.   Financing Cost:
           as well as domestic markets. In the current slowdown
                                                                              The Finance Cost has increased by Rs. 133.09 Lacs
           where companies were looking at reducing costs, your
                                                                              as compared to the previous year, which is mainly
           Company offered its customers a solution that can
                                                                              due to raising of additional working capital facility for
           help them to reduce the costs substantially and this
                                                                              covering up the increase in Gross Sales.
           has helped your Company to post a healthy growth
           rate in spite of the current economic downturn. It        III. DIVIDEND
           has also helped your Company to renew most of the             Your Board of Directors recommends Dividend @ 12 per
           contracts with existing customers.                            cent i.e Rs. 1.20 per equity share for the year ended 31st
           During the Year, your Company achieved Income                 March, 2009. Dividend as recommended if declared will
           from Operations amounting to Rs. 17,142.62 Lacs as            absorb Rs.1,57,67,140/- for the payment to the shareholders
           compared to Rs. 13,156.36 Lacs in the previous year           and Rs.26,79,626/- as Corporate Dividend Tax.
           thereby recording an increase of 30.30 per cent. The




50     Omnitech InfoSolutions Limited
 MANAGEMENT’S PROFILES      OPERATIONAL REV IEW     FINANCIAL SECTION




IV. FIXED DEPOSITS                                                           investing in learning and development programs, creating
     Your Company has not accepted or invited any deposits                   a compelling work environment, empowering employees
     from the public during the year.                                        at all levels and maintaining well-structured reward and
                                                                             recognition mechanisms. Your Company recognizes its
V.   SUBSIDIARY COMPANIES                                                    employees as Key Assets.
     The Company has the following 2 subsidiaries as on 31st
                                                                             Your Company employed a total of 773 employees as on
     March, 2009.
                                                                             31st March, 2009. During the year, your Company has
     1.   Omnitech Technologies Inc. USA                                     successfully launched various programs such as Apna
     2.   Omnitech TSB Co. Ltd, Japan                                        Sapna Money Money Phase I & II, Special Employee
                                                                             Referral Scheme, OmniJet to facilitate and provide benefits
     As required under the provisions of Section 212 of the
                                                                             to its employees. Your Company has also launched web
     Companies Act, 1956, a statement showing the holding
                                                                             based portals like OmniConnect, Lakshya to measure
     Company’s interest in the subsidiary companies forms
                                                                             employees’ performance and to keep them updated with
     part of the Annual Report.
                                                                             latest happenings in the Company. During the Year, your
                                                                             Company organized Dusshera Puja, Holi and various
VI. CONSOLIDATED FINANCIAL STATEMENTS
                                                                             sports events and small get togethers to combine fun with
     Your Directors have pleasure in presenting Consolidated
                                                                             work.
     Financial Statements which form part of the Annual
     Report.                                                                 Your Company has approached various top notch B Schools
                                                                             and colleges across the country. Today the Company
VII. STATUS OF UTILISATION OF FUNDS RAISED IN                                is one of the preferred places to work for professionals
     INITIAL PUBLIC OFFER                                                    across the country.
     Status of utilization of Funds raised by your Company in
     Public Issue as on 31st March, 2009 forms part of Notes            X.   AWARDS & RECOGNITIONS
     to Accounts.                                                            During the year, your Company was selected as one of
                                                                             Asia’s 200 ‘best under a billion’ companies by Forbes
VIII. QUALITY                                                                Asia.
     Your Company recognizes quality as an important
                                                                             Further, your Company also got Deloitte Technology Fast
     differentiator in industry. Therefore, it has well defined
                                                                             Asia- Pacific 2008 award during the year. Your Company
     stringent quality standards with customer focus and
                                                                             was also awarded as one of the excellent performers in
     management commitment and involvement across
                                                                             best support by NCR, Canada
     hierarchies. Your Company has been recertified for
     ISO 9001:2000 and is the way towards ISO 27001:2000
                                                                        XI. CORPORATE GOVERNANCE
     certification to get the benefits of ITIL guidelines and be a
                                                                             A report on Corporate Governance along with Auditors’
     true global service provider. Your Company is also the way
                                                                             certificate on compliance with the conditions of Corporate
     to get CMM level 4 certification.
                                                                             Governance as stipulated in clause 49 of the listing
     Quality Policy: “To achieve business leadership in IT                   agreement, is provided elsewhere in the Annual report.
     solutions and services through continuous enhancement
     of   customer    satisfaction   by   deploying    innovative       XII. CORPORATE SOCIAL RESPONSIBILITY
     technologies with quality management in Products-                       Your Company believes that society is one of its important
     People-Processes supported by effective customer                        stakeholders and approaches its social responsibility as
     relationship management and efficient services”.                        a corporate citizen. Reaffirming its role as a contributing
                                                                             member of the social and economic milieu it occupies,
IX. HUMAN RESOURCES                                                          the Company aligns its business operations with social
     Your Company’s HR policies and processes are aligned                    values. As a responsible corporate citizen, the Company
     to effectively drive its expanding business and emerging                is committed to extend its hand to the under privileged in
     opportunities. This has been achieved by continuously                   areas of education, healthcare, etc.



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     As a part of Corporate Social Responsibility, your Company         of continued Particulars in the Report of Board of Directors)
     has come out with an booklet which contains guidelines on          Rules, 1988, are set out in the Annexure ‘A’ included in this
     how to act in case of emergency such as fire, earthquake           report.
     etc. Your Company has distributed the said booklet to all
     its employees and other people so that the awareness can       XVI. DIRECTORS’ RESPONSIBILITY STATEMENT
     be spread to every house hold. Further, your Company                Based on representations from the Management, the
     organized a Blood Donation Camp and free eye check up
                                                                         Directors state, in pursuance of Section 217 (2AA) of the
     for its employees.
                                                                         Companies Act, 1956, that:
XIII. DIRECTORS                                                         i)    the Company has, in the preparation of the annual
      In terms of the Articles of Association of your Company,                accounts for the year ended 31st March 2009, followed
      Dr. Ram K. Mangal, Independent Director and
                                                                              the applicable accounting standards along with proper
      Dr. Kalimohan Bhattacharya, Independent Director of your
                                                                              explanations relating to material departures, if any;
      Company retire at the forthcoming Annual General Meeting
      and being eligible, offer themselves for re-appointment.          ii)   the Directors have selected such accounting policies
      Brief Resume of the Directors proposed to be reappointed,               and applied them consistently and made judgments
      nature of their expertise in specific functional areas, the             and estimates that are reasonable and prudent so as
      names of the Companies in which they hold Directorships                 to give a true and fair view of the state of affairs of the
      & memberships/chairmanships of Board Committees
                                                                              Company as at 31st March 2009 and of the profit of
      and their shareholdings in the Company, as stipulated
                                                                              the Company for the financial year ended 31st March
      under Clause 49 of the Listing Agreements with the Stock
      Exchanges in India, are provided in the Notice of Annual                2009;
      General Meeting.                                                  iii) the Directors have taken proper and sufficient
                                                                             care for the maintenance of adequate accounting
XIV. AUDITORS REPORT
                                                                             records in accordance with the provisions of the
     The observations made in the Auditors’ report are self
                                                                             Act for safeguarding the assets of the Company
     explanatory and therefore do not call for any further
     comments under Section 217(3) of the Companies Act,                     and for preventing and detecting fraud and other
     1956.                                                                   irregularities; and

     Your Directors request you to appoint Auditors for the             iv)   the Directors have prepared the annual accounts on a
     Financial Year 2009-10. In this regard, attention of the                 going concern basis.
     Members is invited to Item No. 5 of the accompanying
     Notice convening forthcoming Annual General Meeting.           XVII. ACKNOWLEDGEMENTS
                                                                        Your Directors take this opportunity to thank all the
XV. STATUTORY INFORMATION                                               Shareholders, Customers, Vendors, Bankers, and
    As required by the provisions of Section 217 (2A) of
                                                                        Regulatory & Government Authorities for the strong
    the Companies Act, 1956 as amended, read with the
                                                                        support that they have continued to extend to your
    Companies (Particulars of Employees) Rules, 1975, the
                                                                        Company.
    names and other particulars of the employees are set out
    in the Annexure ‘B’ to this Report                                  The Board also takes this opportunity to place on record
     The particulars relating to energy conservation, technology        its appreciation of the outstanding performance and
     absorption, foreign exchange earnings and outgo, as                dedication of your Company’s employees at all levels,
     required to be disclosed under section 217(1)(e) of the            without whose commitment the achievement of results as
     Companies Act, 1956 read with the Companies (Disclosure            indicated above could not have been possible.




                                                                                         By Order of the Board of Directors
                                                                                           Omnitech InfoSolutions Limited

                                                                                      Sd/-                                 Sd/-
Place: Mumbai                                                                    (Atul Hemani)                      (Avinash Pitale)
Date: 25th May, 2009                                                          Managing Director                    Executive Director


52    Omnitech InfoSolutions Limited
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Annexure ‘A’ to the Directors’ Report
Particulars as prescribed under section 217(1) (e) of the                    Management and Performance management space
Companies Act, 1956 read with the Companies (Disclosure                      and to remain leader in this space, your Company
of continued Particulars in the Report of Board of Directors)                continues to invest further to develop technology
Rules, 1988                                                                  products, technical skills and processes. The core
                                                                             team works closely with technology partners to derive
1.   DETAILS OF CONSERVATION OF ENERGY                                       implied benefits of their technology. Your Company
     Your Company’s operations consume very low levels of                    has now world-class labs at its technology center to
     energy. It is pleasure to announce that your Company’s                  develop and design the technology products. This
     technology     center   has     latest   technology   energy            core team is currently focusing on development and
     management system based on human occupancy. As the                      enhancement of tools for Infrastructure management
     cost of energy consumed by the Company forms a very                     and performance management area.
     small portion of the total costs, the impact of changes in              OmniMonitor - An infrastructure and application
     energy cost on total cost is insignificant.                             monitoring appliance has been deployed for
                                                                             various customers for remote monitoring services.
2.   TECHNOLOGY ABSORPTION                                                   This is further enhanced with feature to monitor
     Your Company is a technology driven organization and                    infrastructure and SAP application in the current year
     understands the importance of acquisition of technical                  to cater to manufacturing segment.
     expertise from time to time. It has successfully built such
                                                                             Team of experts is further working on developing the
     expertise over a period of years and shall continue to with
                                                                             accelerators/tools for automation of performance
     emerging technologies to be on a leading edge to offer
                                                                             management.
     its customers the state of art solutions. Your Company
     has concentrated on Banking, Financial Services and                b)   Benefits derived as a result of the above R&D:
     Insurance (BFSI), IT & ITES, Manufacturing and Retails                  The new technologies and skill sets available with
     as vertical industry, which demand continuous research                  your Company have resulted in development of
     and development in the areas of business analysis,                      Intellectual Property (IP) products. These products
     developments, upgrades. Focused efforts have been                       help your Company to offer unique proposition to
     put into consulting, deployment and management                          global customers and also help to derive competitive
                                                                             advantage to win over its competition. Such products
     methodologies and tools to help your Company to deliver
                                                                             when blended with technology services help your
     the best of solutions to customers. Your Company has
                                                                             Company to save from license costs of various
     unique proprietary methodology “APDIMA” (Assess, Plan,
                                                                             other tools which would have to be used otherwise.
     Design, Implement, Manage and Audit) for technology
                                                                             Development of software tools and components
     practices to deliver such solutions.
                                                                             help your Company to offer world-class application
     a)   As part of its Continuous Improvement Program,                     solutions in lesser time and most competitive ways.
          Company has formed core team of highly skilled                     Such tools also enable your Company to differentiate
          professionals having expertise in functional as well               from competition in terms of satisfying customer
          technical professionals. This team is goaled for                   need.
          improvement of business processes, technologies
                                                                        c)   Future plan of action
          and people productivity. Your Company carries out
                                                                             Your Company will continue to invest on continual
          methodical surveys, market research programs                       development of skills, procedures and processes
          and also participates with global technology leaders               to ensure optimal utilization of resources available
          to identify and track the new trends. Research and                 in this highly dynamic industry. Your Company will
          Development carried out by your Company:                           further continue to work in the areas of remote
          Your Company has been a niche player in the areas                  monitoring , management and Disaster Recovery
          of   IT   Infrastructure    management,     application            monitoring tools.



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     d)   Expenditure on R&D                                                  Offshore Development Center using BOT delivery
          Your Company has not incurred any expenditure on                    model
          R & D during this year.                                             Software Testing Service using SaaS model

3.   TECHNOLOGY ABSORPTION, ADOPTION AND                             4.   TOTAL FOREIGN EXCHANGE USED AND EARNED
     INNOVATION
     Your Company’s quality systems are ISO 9001:2000                                                              Rupees in lakhs
     certified, which reflects a high degree of technology                Year ended 31st March                  2009           2008
     absorption, adoption and innovation across various                   Foreign Exchange Earned:
     operating layers within the Company. During the year
                                                                          Export Sales                        5,212.95      2,907.13
     technology absorption activities have mainly centered on:
                                                                          Foreign Exchange Used:
          Network Operations Center
                                                                          Software Purchases                  2,669.09     2,297.25
          Disaster Recovery Center
                                                                          Expenditure on Foreign Travel          38.63          32.65
          IT Infrastructure Management                                    Commission paid on Export               7.35               -
                                                                          Sales



                                                                                         By Order of the Board of Directors
                                                                                          Omnitech InfoSolutions Limited

                                                                                      Sd/-                               Sd/-
Place: Mumbai                                                                     (Atul Hemani)                   (Avinash Pitale)
Date: 25th May, 2009                                                          Managing Director                 Executive Director




54    Omnitech InfoSolutions Limited
 MANAGEMENT’S PROFILES         OPERATIONAL REV IEW    FINANCIAL SECTION




Annexure ‘B’ to the Directors’ Report
Particulars as per Section 217(2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975 and
the forming part of the Directors’ Report for the year ended 31st March, 2009


 Sr.      Name                 Designation    Qualification     Age       Experience              Date of      Previous             Gross
 No                                                           (Years)     (In years)              Joining   Employment     Remuneration
                                                                                                                                     (Rs.)
 1        Mr. Atul Hemani      Managing       B.E.               45          22             October 30,       Hindustan          27,86,162
                               Director       (Electrical)                                          1990      Computer
                                                                                                                Limited
 2        Mr. Avinash Pitale   Executive      B.E.               46          22             October 30,       Hindustan          26,86,179
                               Director       (Electrical)                                          1990      Computer
                                                                                                                Limited
 3        Mr. Devarshi Buch    Executive      B.E.               44          22             April 1, 2001     Minicomp          28,06,078
                               Director       (Electrical)                                                      Limited
 4        Mr. Anurag Shah      CEO            B.E                31           11            July 1, 2006      Edventure         25,46,333
                               (Technology    (Computers)                                                   Systems Inc.
                               Services)

Notes:

1.     All the above-mentioned persons are permanent employees of the Company.




                                                                                              By Order of the Board of Directors
                                                                                               Omnitech InfoSolutions Limited

                                                                                           Sd/-                              Sd/-
Place: Mumbai                                                                          (Atul Hemani)                   (Avinash Pitale)
Date: 25th May, 2009                                                               Managing Director                  Executive Director




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Report on Corporate Governance




56   Omnitech InfoSolutions Limited
MANAGEMENT’S PROFILES   OPERATIONAL REV IEW   FINANCIAL SECTION




                                                                  Annual Report 2008-09   57
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The Company has complied in all respects with the applicable provisions on Corporate Governance stipulated under Clause 49 of
the Listing Agreements with the Stock Exchanges. A Report on the Corporate Governance compliance is furnished below:

(I). COMPANY’S PHILOSOPHY ABOUT CORPORATE GOVERNANCE
     The Company is highly committed to the adoption and adherence of good Corporate Governance Practices so as to ensure
     that all the stakeholders of the Company obtain requisite information about the Company and its operations in an efficient and
     timely manner. Such Corporate Governance Practices also help enhancement of long term shareholder value and interest of
     other Stakeholders.

     The Board of Directors of the Company fully understands and appreciates the need of increased awareness for transparency
     and professionalism for effective control and management of the organization.

(II). MANDATORY REQUIREMENTS:
     1.     Board of directors
            (a) Composition of Board of Directors
                The board of directors of the Company presently comprises of 8 Directors including one Non-Executive chairman, 3
                Executive Directors and 4 Independent Directors. Except Managing Director, the other Directors are liable to retire
                by rotation.
            (b) Details about Board Meetings Held During the Year

                During the Year, 5 Board Meetings were held on following dates:

                 Board                                                    Date
                 Meeting
                 First                                          13th May, 2008
                 Second                                          4th July, 2008
                 Third                                          17th July, 2008
                 Fourth                                     20th October, 2008
                 Fifth                                      27th January, 2009

            (c) Attendance of Directors at Board Meetings and the last AGM held on 13th June, 2008

                 Sr. No.    Name Of Director                       No. of Board Meetings          Attendance in the Last AGM
                                                                          Attended                          (Yes/No)
                 1          Mr. Maganlal K. Hemani                             4                               Yes
                 2          Mr. Atul M. Hemani                                 5                               Yes
                 3          Mr. Avinash C. Pitale                              5                               Yes
                 4          Mr. Devarshi D. Buch                               5                               Yes
                 5          Dr. Kalimohan Bhattacharya                         5                               Yes
                 6          Dr. Ram K. Mangal                                  3                                No
                 7          Prof. Venkateshwaran H. Iyer                       4                               Yes
                 8          Mr. Vasudeva V. Kamath                             4                                No
            (d) Code of Conduct
                Omnitech Code of Conduct laid down by the Board of Directors is applicable to all the Directors and Senior
                Management of the Company. The Code of Conduct is posted on the Company’s website. All the Board Members and
                Senior Management of the Company have affirmed compliance with the Code of Conduct for the Financial Year ended
                March 31, 2009. A declaration to this effect, duly signed by the Managing Director is annexed hereto.




58        Omnitech InfoSolutions Limited
MANAGEMENT’S PROFILES    OPERATIONAL REV IEW    FINANCIAL SECTION




       (e) Details about Directorship/Membership of Board Committees held by Directors in Other Companies

            Sr. No.     Name Of Director                    Directorship(s)Held in Other Companies          Membership of
                                                                                                            Board Committee
                                                                                                            Held in Other
                                                                                                            Companies
            1           Mr. Maganlal K. Hemani              Omnitech Technologies Limited, India            None
            2           Mr. Atul M. Hemani                  1. Omnitech Technologies Limited, India         None
                                                            2. DRC Gulf W.L.L., Bahrain
                                                            3. Omni Gulf Technologies W.L.L., Bahrain
                                                            4. Omnitech Technologies Inc., USA
            3           Mr. Avinash C. Pitale               1. Omnitech Technologies Limited, India         None
                                                            2. DRC Gulf W.L.L., Bahrain
                                                            3. Omni Gulf Technologies W.L.L., Bahrain
                                                            4. Omnitech Technologies Inc., USA
            4           Mr. Devarshi D. Buch                Omnitech Technologies Inc., USA                 None
            5           Dr. Kalimohan J. Bhattacharya       1. Gansons Limited, India                       None
                                                            2. Marshall Sons & Co India Ltd, India
            6           Dr. Ram K. Mangal                   None                                            None
            7           Prof. Venkateshwaran H. Iyer        None                                            None
            8           Mr. Vasudeva V. Kamath              None                                            None
  2.   Audit Committee
       (a) Composition
           The Audit Committee has been constituted as per Section 292A of the Companies Act, 1956 and the guidelines set out
           in the Listing Agreement with the Stock Exchanges. The Audit Committee currently consists of the following three
           Directors:
           1. Dr. Kalimohan J. Bhattacharya             -           Chairman
           2. Prof. Venkateshwaran H. Iyer              -           Member
           3. Mr. Devarshi D. Buch                      -           Member
           The Company Secretary of the Company acts as a secretary to the Audit Committee.
       (b) Terms of Reference
           The role and terms of reference of the Audit Committee covers the matters specified for Audit Committee under
           Clause 49 of Listing Agreement which, interalia, include overseeing the company’s financial reporting process,
           reviewing periodic financial results, financial statements, internal control and internal audit systems, accounting
           policies and practices, related party transactions and performance of internal and external auditors.
       (c) Meetings and Attendance during the year
           During the year 2008-09, 4 Audit Committee Meetings were held on 13th May, 2008, 17th July, 2008, 20th October,
           2008 and 24th January, 2009. Attendance of Committee Members at Committee Meetings is as follows:

            Name                                                                          No. of Meetings Attended
            Dr. Kalimohan J. Bhattacharya                                                              4
            Prof. Venkateshwaran H. Iyer                                                               3
            Mr. Devarshi D. Buch                                                                       4



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     3.   Shareholders’ Grievance Committee
          (a) Composition
              The Shareholder’s Grievance Committee currently consists of the following three Directors:

              1. Prof. Venkateshwaran H. Iyer    -           Chairman

              2. Dr. Ram K. Mangal               -           Member

              3. Mr. Avinash C. Pitale           -           Member

          (b) Terms of Reference
              The terms of reference of the Shareholders’ Grievance Committee interalia include reviewing status of approval of
              transfer/ transmission of shares, issue of duplicate share certificates and redressal of complaints of investors.

          (c) Status of Shareholders’ Complaints as on 31st March, 2009

               Complaints             Complaints received        Complaints resolved during the      Complaints Pending at the
               Pending at the         during the year            Year                                end of Year
               beginning of the
               Year
               NIL                    96                         96                                  NIL
     4.   Share Transfer Committee
          (a) Composition
              The Share Transfer Committee currently consists of the following three Directors:

              1. Mr. Atul M. Hemani                          -          Chairman

              2. Dr. Ram K. Mangal                           -          Member

              3. Dr. Kalimohan J. Bhattacharya               -          Member

          (b) Terms of Reference
              The terms of reference of the Share Transfer Committee inter alia include approving transfer of shares and taking
              note of dematerialization of shares.

     5.   General Body Meetings

           Date                          Time        Venue                                                     No. of Special
                                                                                                            Resolutions passed
           22nd August, 2006          5:00 pm        Omnitech House                                                   7*
                                                     A/13, Cross Road No. 5,
                                                     Kondivita Road, Marol,
                                                     M.I.D.C., Andheri (E),
                                                     Mumbai – 400093
           27th July, 2007            4:00 pm        Omnitech House                                                  Nil
                                                     A/13, Cross Road No. 5,
                                                     Kondivita Road, Marol,
                                                     M.I.D.C., Andheri (E),
                                                     Mumbai – 400093
           13th June, 2008            10.30 am       Hotel Tunga Paradise,                                           8**
                                                     MIDC Central Road, Andheri (E),
                                                     Mumbai – 400093



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       In the last three AGMs, there was no resolution passed through postal ballot.

       *At the annual general meeting of the Company held on 22nd August, 2006, Special Resolutions passed were for (a)
       Adoption of New Set of Articles of Association; (b) Issue of Shares to General Public by way of IPO; (c) Issue of Shares on
       Preferential Basis; (d) Increase in Limit for Investment by FII up to 40 % in the Paid up Capital of the Company; (e) Increase
       in Remuneration to Mr. Atul Hemani – Managing Director; (f) Increase in Remuneration to Mr. Avinash Pitale – Executive
       Director; (g) Increase in Remuneration to Mr. Devarshi Buch – Executive Director.

       **At the annual general meeting of the company held on 13th June, 2008 , Special Resolutions passed were for (a) Issue
       of share warrants to Wintel Computers Private Limited; (b) Issue of Share Warrants to Mr. Atul Hemani; (c) Issue of Share
       Warrants to Mr. Avinash Pitale; (d) Issue of Share Warrants to Mr. Devarshi Buch; (e) Issue of Share Warrants to Mr. Nikul
       Shah; (f) Issue of Share Warrants to Mrs. Anuradha Shah; (g) Issue of Share Warrants to Meticulous Fiscal Company
       Private Limited; (h) Issue of Share Warrants to Mr. Sanjay Asher

  6.   Subsidiary Companies
       Since the Company does not have any material Non-listed Indian Subsidiary Company, the Company is not required to
       have an Independent Director of the Company on the Board of such Subsidiary Company as per the requirement of Clause
       49 to the Listing Agreement with the Stock Exchanges.

  7.   Disclosures
       (a) The company has been continuously complying with various legal requirements of the stock exchanges, SEBI and
           other statutory authorities since the day of listing and no penalties have been imposed on the company by them till
           date.

       (b) The company has not entered into any transaction of material nature with the promoters, the directors or the
           management, their subsidiaries or relatives etc that may have any potential conflict with the interests of the company.
           Transactions with related parties have been disclosed in Notes to Annual Accounts in the Annual Report

       (c) All mandatory Accounting Standards have been followed in preparation of financial statements and no deviation has
           been made in following the same.




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     8.   Remuneration of Directors
          The Remuneration is paid to Directors in accordance with the Provisions of the Companies Act, 1956. Non-executive
          Directors are paid Sitting Fees at the rate of Rs. 5000/- for each of the meetings of Board or Committees thereof attended
          by them. The details of remuneration paid/payable to each of Director for the year ended March 31, 2009 are as under:

           Sr.    Name Of Director    Category         Salary (In   Contribution           Other     Sitting Fees             Total
           No.                                              Rs.)           to PF     Perquisites          (In Rs.)   Remuneration
                                                                         (In Rs.)               &                           (In Rs.)
                                                                                     Allowances
                                                                                          (In Rs.)
           1      Mr. Maganlal K.     Non-                     0               0                0          20000             20000
                  Hemani              Executive
                                      Chairman
           2      Mr. Atul M.         Managing           1664986            9360          1111816               0          2786162
                  Hemani              Director
           3      Mr. Avinash C.      Executive          1590777            9360         1086042                0          2686179
                  Pitale              Director
           4      Mr. Devarshi D.     Executive          1521748          182610         1101720                0          2806078
                  Buch                Director
           5      Dr. Kalimohan J.    Non-                     0               0                0          45000             45000
                  Bhattacharya        Executive
                                      Independent
                                      Director
           6      Dr. Ram K. Mangal   Non-                     0               0                0          15000             15000
                                      Executive
                                      Independent
                                      Director
           7      Prof.               Non-                     0               0                0          35000             35000
                  Venkateshwaran      Executive
                  H. Iyer             Independent
                                      Director
           8      Mr. Vasudeva V.     Non-                     0               0                0          20000             20000
                  Kamath              Executive
                                      Independent
                                      Director

          All executive directors are appointed under contracts each for a period of five years and with termination notice of 180
          days.




62    Omnitech InfoSolutions Limited
MANAGEMENT’S PROFILES        OPERATIONAL REV IEW   FINANCIAL SECTION




  9.   Shares held by Non- Executive Directors as on 31st March, 2009

        Name                                                       Number of Shares held                % of total shareholding
        Mr. Maganlal K. Hemani                                                      10000                                    0.08
        Dr. Kalimohan Bhattacharya                                                      25                               0.00019
        Dr. Ram K. Mangal                                                           12000                                    0.09
        Prof. V. H. Iyer                                                             2200                                  0.0167
        Mr. V.V. Kamath                                                                Nil                                    Nil
  10. Means of communication
       The audited quarterly, half-yearly, nine months and annual financial statements viz., balance sheet, profit and loss
       account, including schedules and notes thereon, press releases, and presentations are posted on the Company’s website
       i.e. http://www.omnitechindia.com/html/investors.asp

       The half-yearly, nine months Financial Results are normally published in “The Economic Times” and “The Navbharat
       Times”. All material information about the Company is promptly sent to the Stock Exchanges where the Company’s
       shares are listed and released to wire services and the press for information of the public at large. Also the official news
       releases and presentations made to FII’s/Analysts are displayed on the website.

  11. Management Discussion and Analysis Report
       As required by sub-clause IV (F) of clause 49 of the listing agreement, Management Discussion and Analysis Report is
       provided in the annual report.

  12. General Shareholder Information
       (a) Shareholding Pattern as on 31st March, 2009

             Category                                                    No. of equity shares                   Percentage (%)
             1.Promoter Group:
             (i) Directors                                                           3455462                              26.30%
             (ii) Directors relatives/HUF                                            2922045                              22.24%
             (iii) Body Corporate                                                     766850                               5.84%
             2. Public:
             (i) Mutual Funds                                                            9271                              0.07%
             (ii) Body Corporate                                                     1490752                              11.35%
             (iii) Non- Residents                                                      84835                               0.65%
             (iv) Residents                                                          4410068                              33.55%
             Total                                                                 13139283                                100%




                                                                                                     Annual Report 2008-09      63
                                                                  ABOUT US MANAGING DIRECTOR’S REV IEW    EXCELLENCE IN UNCERTAINTY




       (b) Distribution of Shareholding as on 31st March, 2009

            No. of Shares                            Shareholders                                      Shares Held
                                          Number                         %                  Number                      %
            1-500                          10359                       91.092                971914                   7.397
            501-1000                           452                     3.975                 378594                  2.8814
            1001-2000                          213                     1.873                 320722                  2.4409
            2001-3000                          94                      0.827                 239693                  1.8242
            3001-4000                          41                      0.361                 146055                   1.1116
            4001-5000                          47                      0.413                 226764                   1.7258
            5001-10000                         78                      0.686                 613639                  4.6703
            Above 10000                        88                      0.774                10241902                  77.949
            Total                          11372                      100.00               13139283                  100.00
       (c) Listing on Stock Exchanges

            Stock Exchange                                                                          Stock Code
            Bombay Stock Exchange Limited                                                            532882
            National Stock Exchange of India Limited                                                OMNITECH
       (d) Listing Fees and Annual Custodial Fee
           The Company has paid the Annual Listing fees of the Stock Exchanges and Annual Custodial Fees of the Depositories
           for the year 2008-09.

       (e) Market Price Data

                                       Bombay Stock Exchange Limited                  National Stock Exchange of India Limited
                 Month             High (Rs.)         Low (Rs.)          Monthly       High (Rs.)        Low (Rs.)      Monthly
                                                                         Volume                                          Volume
            Apr-08                    179.45           121.55            213973          167.80           121.95         246204
            May-08                    212.80           155.00           3359618          212.10           155.00        4658667
            Jun-08                    187.80           125.00            428683          190.00           125.35         407424
            Jul-08                    141.00           105.55            360689          141.00           105.00         328022
            Aug-08                    151.95           126.50            480511          152.45           126.00         458276
            Sep-08                    132.75           90.50             237835          134.90           83.05          209188
            Oct-08                    103.00           52.60             171584          104.75           53.00          153004
            Nov-08                    86.00             51.15             61569          87.70            50.15          56526
            Dec-08                    77.20            50.00             170981          80.90            43.95          183946
            Jan-09                    69.90            38.00             190078          70.00            38.00          108892
            Feb-09                    48.00            29.55             118276          50.40            29.50          138027
            Mar-09                    40.90            30.00             374857          42.00            30.55          268139




64   Omnitech InfoSolutions Limited
MANAGEMENT’S PROFILES       OPERATIONAL REV IEW                 FINANCIAL SECTION




                              Omnitech v/s Sensex                                                                   Omnitech v/s Nifty
                                 08
                       08




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                                 Omnitech                 Sensex                                                     Omnitech                 Nifty




       (f)   19th Annual General Meeting

              Date                                                            12th September, 2009
              Time                                                            11 a.m.
              Venue                                                           The Mirador Hotel, New Link Road, Chakala, Andheri (E)
                                                                              Mumbai - 400099
              Tentative Financial calendar 09-10:
              1st Quarter Results                                             3rd week of July, 2009
              2nd Quarter /half yearly results                                3rd week of October, 2009
              3rd Quarter Results                                             3rd week of January, 2009
              Annual Results                                                  3rd / 4th week of May, 2009
              Financial Year                                                  1st April to 31st March
              Date of book closure (Both days inclusive)                      5th September, 2009 to 12th September, 2009
              Dividend payment Date                                           On or after 13th September, 2009
       (g) Share transfer System
             The company’s Registrar and Transfer Agent have been entrusted with the handling of physical transfer of shares as
             well as dematerialization of shares. The Board of Directors of the company has delegated the power of approval of
             share transfer processed by Registrar and Transfer Agent to Shareholders’ Grievance Committee which comprises
             of Chairman, one Executive Director and one Non-Executive Independent Director.

       (h) Dematerialization of Shares
             The company’s RTA has the required infrastructure for dematerialization of shares. As per the defined norms of
             dematerialization process, shares received for dematerialization are generally taken care within a time span of five
             days from the date of receipt. As on March 31st 2009, 87.92% of the outstanding shares are in electronic form.

       (i)   Outstanding Convertible Warrants
             During the Financial year ended on 31st March, 2009, the Company issued 13,25,000 Convertible warrants on
             preferential basis in accordance with SEBI Guidelines. The said convertible warrants can be converted into the equity
             shares within 18 months of the issue. As on 31st March, 2009, none of the said warrants have been converted into
             Equity Shares.




                                                                                                                              Annual Report 2008-09              65
                                                                  ABOUT US MANAGING DIRECTOR’S REV IEW    EXCELLENCE IN UNCERTAINTY




            (j)   Registrar & Share Transfer Agent and address of correspondence
                  Any clarification/grievances/queries/suggestions pertaining to share transfer/Dematerialisation can be addressed to
                  the company’s Registrar and Transfer Agent at their following address:

                  Link Intime India Private Limited
                  C-13, Pannalal Silk Mills Compound
                  LBS Road, Bhandup (W), Mumbai-400078
                  Ph: (022) 25963838; Fax: (022) 25962691
                  E-mail: rnt.helpdesk@linkintime.co.in

            (k) Compliance Officer
                  Mr. Gaurav Sharma, Company Secretary & Chief Officer (Compliance & Legal)
                  Omnitech House, A/13, Cross Road No. 5,
                  Marol MIDC, Andheri (E), Mumbai – 93

            (l)   Plant Location
                  (i)   A-13, Cross Road No.5, Kondivita Road, Marol M.I.D.C., Andheri (E), Mumbai – 400093

                  (ii) A-812, T.T.C. Industrial Area, Koparkhairane, Navi Mumbai 400703 .

     13. CEO/CFO Certification
            As required under Clause 49 of the Listing Agreement, a Certificate duly signed by Managing Director (CEO) was placed
            at the meeting of the Board of Directors held on 25th May, 2009.

(III). NON-MANDATORY REQUIREMENTS
     1.     Compensation Committee
            (a) Composition
                  The Compensation Committee currently consists of the following three Directors:

                  1.    Dr. Ram K. Mangal                     -        Chairman

                  2.    Dr. Kalimohan J. Bhattacharya         -        Member

                  3.    Prof. Venkateshwaran H. Iyer          -        Member

            (b) Terms of Reference
                  The terms of reference of the Committee are to review and recommend/approve remuneration payable to the
                  Managerial Personnel.

            (c) Meetings and Attendance during the year
                  Since there was no business to be transacted, no meeting of the Committee was held during the year.




                                                                                                   By Order of the Board of Directors
                                                                                                     Omnitech InfoSolutions Limited

                                                                                                                        Sd/-
Place: Mumbai                                                                                                      (Atul Hemani)
Date: 25th May, 2009                                                                                             Managing Director



66        Omnitech InfoSolutions Limited
 MANAGEMENT’S PROFILES        OPERATIONAL REV IEW     FINANCIAL SECTION




CEO’s Certification
All the Board Members and Senior Management of the Company have affirmed compliance with the Code of Conduct laid down by
the Board of Directors in terms of Clause 49 of the Listing Agreement made with the Stock Exchanges.



Place : Mumbai                                                                           For and on behalf of the Board of Directors
Date : 25th May, 2009                                                                                       Sd/-
                                                                                                       (Atul Hemani)
                                                                                                     Managing Director




Certification by the Chief Executive
Officer (CEO)/Chief Financial Officer (CFO
on Financial Statements of the Company
(1)   I have reviewed financial statements and the cash flow statement for the year ended 31st March, 2009 and that to the best of
      my knowledge and belief:

      (i)   these statements do not contain any materially untrue statement or omit any material fact or contain statements that
            might be misleading;

      (ii) these statements together present a true and fair view of the Company’s affairs and are in compliance with existing
            accounting standards, applicable laws and regulations.

(2) There are, to the best of my knowledge and belief, no transactions entered into by the company during the year which are
      fraudulent, illegal or violative of the Company’s code of conduct.

(3) I accept responsibility for establishing and maintaining internal controls for financial reporting and that I have evaluated the
      effectiveness of internal control systems of the company pertaining to financial reporting and I have disclosed to the auditors
      and the Audit Committee, deficiencies in the design or operation of such internal controls, if any, of which I am aware and the
      steps I have taken or propose to take to rectify these deficiencies.

(4) I have indicated to the auditors and the Audit committee:

      (i)   significant changes in internal control over financial reporting during the year;

      (ii) significant changes in accounting policies during the year and that the same have been disclosed in the notes to the
            financial statements; and

      (iii) instances of significant fraud of which I have become aware and the involvement therein, if any, of the management or an
            employee having a significant role in the company’s internal control system over financial reporting.



                                                                                                                          Sd/-
Place: Mumbai                                                                                                         (Atul Hemani)
Date: 25th May, 2009                                                                                                Managing Director


                                                                                                         Annual Report 2008-09         67
Auditors’ Certificate on Compliance
of Corporate Governance
To the Members of

OMNITECH INFOSOLUTIONS LIMITED

Omnitech House, A/13, Cross Road, No 5,

Kondivita Road, Marol, M.I.D.C., Andheri (East),

Mumbai – 400093



We have examined the compliance of conditions of Corporate Governance by Omnitech InfoSolutions Limited for the year ended
31st March, 2009 as stipulated in Clause 49 of the listing agreements entered into by the Company with the Stock Exchanges.

The compliance of conditions of Corporate Governance is the responsibility of Management. Our examination was limited to
procedures and implementation thereof, adopted by the Company for ensuring the compliance of the conditions of Corporate
Governance. It is neither an audit nor an expression of opinion on the financial statements of the Company.

In our opinion and to the best of our information and according to the explanations given to us, we certify that the Company
has complied in all material respects with the conditions of Corporate Governance as stipulated in the above mentioned listing
agreement.

We state that such compliance is neither an assurance as to the future viability of the Company not the efficiency or effectiveness
with which management has conducted the affairs of the Company.




                                                                                                         For M/s. Kothari & Kenia
                                                                                                           Chartered Accountants



Place : Mumbai                                                                                                 (Nailesh R. Kothari)
Date : 25th May, 2009                                                                                                      Partner
                                                                                                         Membership No: 042367




68    Omnitech InfoSolutions Limited
AUDITORS’ REPORT
To The Members

OMNITECH INFOSOLUTIONS LIMITED                                       4. In our opinion, the Balance Sheet , Profit and Loss
Omnitech House, A/13, Cross Road, No 5,                                 Account and Cash Flow statement dealt with by this
Kondivita Road, Marol, M.I.D.C., Andheri (East),                        report comply with the Accounting Standards referred
                                                                        to in Sub-Section (3C) of Section 211 of the Companies
Mumbai – 400 093.
                                                                        Act, 1956, subject to the following, and read with
1. We have audited the attached Balance Sheet of OMNITECH               point no. 4 of notes to accounts.
   INFOSOLUTIONS LIMITED, as at 31st March 2009 and the                  Till the year March, 2008 the company was
   attached Profit & Loss account and the Cash Flow statement            providing depreciation on software @ 16.21 % on
   of the Company for the year ended on that date annexed                Straight Line method as specified under Schedule
   thereto. These financial statements are the responsibility            XIV to the Companies Act, 1956. However in line
   of the Company’s Management. Our responsibility is to                 with Accounting Standard 26 (Accounting for
   express an opinion on these financial statements based on             Intangibles) of ICAI, from the year 2008-2009,
   our audit.                                                            value of software purchased is depreciated over
2. We have conducted our audit in accordance with                        its useful life retrospectively. But for the change as
   auditing standards generally accepted in India. Those                 above the depreciation would have been higher and
   standards require that we plan & perform the audit to                 profit would have been lower by, Rs. 15.02 Lakhs
   obtain reasonable assurance about whether the financial               for the year earlier years and depreciation would
   statements are free of material misstatement. An audit                have been lower and profit would have been higher
   includes examining, on a test basis, evidence supporting              by, Rs. 12.26 Lakhs for the year current year.
   the amounts and disclosures in the financial statements.       5. On the basis of written representations received from the
   An audit also includes assessing the accounting principles        directors of the Company as at 31st March 2009 and taken
   used and significant estimates made by the Management,            on record by the Board of Directors, none of the directors
   as well as evaluating the overall financial statement             is, prima facie disqualified as on above date from being
   presentation. I believe that our audit provides a reasonable      appointed as a director in terms of clause (g) of sub-section
   basis for our opinion.                                            (1) of section 274 of the Companies Act, 1956.
3. As required by the Companies (Auditors Report) Order,          6. Subject to the forgoing, in our opinion and to the best of our
   2003, (the said order) issued by the Central Government           information and according to the explanation given to us,
   of India in terms of Section 227(4A) of the Companies Act,        the said accounts read together with the notes on accounts
   1956, (the Act), as amended by the Companies (Auditors            and other notes thereon, give the information as required
   Report) amendment Order, 2004, and on the basis of                by the Companies Act, 1956 in the manner so required and
   such checks of the books and records as we considered             give a true and fair view in conformity with the accounting
   necessary and appropriate and according to the information        principles generally accepted in India :
   and explanation given to us during the course of our audit.
                                                                     a. In the case of Balance Sheet of the State of affairs of
   We enclose in the Annexure a statement on the matter
                                                                        the Company’s as at 31st March 2009;
   specified in paragraph 4 and 5 of the said Order.
                                                                     b. In the case of the Profit & Loss Account ,of the profit for
4. Further to our comments in the Annexure referred to in
                                                                        the year ended on that date; and
   Paragraph 3 above, We report that:
                                                                     c. In the case of Cash Flow Statement, of the cash flows
   1.   We have obtained all the information and explanations,
                                                                        for the year ended on that date.
        which to the best of our knowledge and belief were
        necessary for the purpose of our audit.
   2. In our opinion, proper books of accounts as required by                                       For M/s. KOTHARI & KENIA
      law have been kept by the Company so far as appears                                               [Chartered Accountants]
      from our examination of those books.                                                                                 Sd/-
   3. The Balance Sheet, Profit & Loss Account and                                                                       Partner
      Cash Flow statement dealt with by this report               Place : Mumbai                             Nailesh R. Kothari
      are in agreement with the books of accounts.
                                                                  Date : 25th May 2009                   Membership No. 42367




                                                                                                    Annual Report 2008-09       69
ANNEXURE                     To the Auditor’s Report
(Referred to in paragraph 3 of our report of even date)



i.     (a)   The company has maintained proper records                            weakness in the internal control.
             showing full particulars including quantitative              v.      (a)   According to the information and explanations given
             details and situation of its fixed assets.                                 to us, we are of the opinion that the transactions
       (b)   The fixed assets are physically verified by the                            that need to be entered into the register maintained
             Management at reasonable intervals having regard                           under section 301 of the Companies Act, 1956, if any,
             to size of the Company and n ature of its assets. We                       have been so entered.
             have been informed that no material discrepancies                    (b)   In our opinion and according to the information and
             were noticed during such physical verification.                            explanations given to us, the transactions made in
       (c)   According to information and explanation given to                          pursuance of contracts or arrangements entered
             us, we are of the opinion that during the year, the                        in the register maintained under section 301 of the
             company has not sold/disposed off any substantial                          Companies Act, 1956 and exceeding the value of
             part of its fixed assets; accordingly, going concern is                    rupees five lakhs in respect of any party during the
             not affected and hence the provisions of sub clause                        year have been made at prices which are reasonable
             (c) of clause (i) of this order are not applicable.                        having regards to prevailing market prices at the
ii.    (a)   According to information and explanation given to us,                      relevant time.
             the inventory has been physically verified during the        vi. The Company has not taken any deposits from the public
             year by the management at regular intervals. In our                 within the meaning of section 58 - A & 58 AA of the
             opinion, the frequency of verification carried out by the           Companies Act, 1956 and the Companies (Acceptance of
             management is reasonable.                                           Deposit) rules 1975 and hence the provisions of the clause
       (b)   In our opinion and according to the information                     of 4(vi) of the Companies (Auditor’s Report) Order, 2003 (as
             and explanations given to us, the procedures of                     amended) are not applicable to the company.
             physical verification of inventories followed by the         vii.    In our opinion, the company has an internal audit system
             management are reasonable and adequate in                            commensurate with the size and nature of its business.
             relation to the size of the company and the nature of        viii. In our opinion and according to the information and
             its business.                                                        explanations given to us, the maintenance of cost records
       (c)   In our opinion and according to the information and                  has not been prescribed by the Central Government
             explanations given to us, the company is maintaining                 under section 209 (1)(d) of the Companies Act, 1956, for
             proper records of inventory. The discrepancies                       the products manufactured/traded by the Company.
             noticed on physical verification of inventories as           ix.     (a)   Undisputed Statutory dues including provident fund,
             compared to book records were not material.                                investor education and protection fund, employees
iii.   The Company has neither granted nor taken any loans,                             state insurance, income tax, value added tax, wealth
       secured or unsecured, from companies, firms or other                             tax, service tax, custom duty, excise duty, cess
       parties listed in the Register maintained under Section                          and other material statutory dues applicable to it,
       301 of the Act. As the Company has neither granted nor                           have generally been regularly deposited with the
       taken any loans, secured or unsecured, from companies,                           appropriate authorities though there has been a
       firms or other parties listed in the Register maintained                         slight delay in a few cases.
       under Section 301 of the Act, paragraphs of (iii) (b), (iii) (c)           (b)   According to the information and explanations given
       and (iii) (d) of the Order are not applicable.                                   to us, no undisputed amounts payable in respect
iv.    In our opinion and according to the information and                              of income tax, wealth tax, service tax, sales tax,
       explanations given to us, there are adequate internal                            customs duty, excise duty and cess were in arrears,
       control procedures commensurate with the size of the                             as at 31st March 2009 for a period of more than six
       company and the nature of its business for the purchase                          months from the date they became payable.
       of inventory, fixed assets and for the sale of goods.                      (c)   According to the information and explanation
       Further based on our examinations and according to the                           given to us, there are no dues of vat tax, customs
       information and explanations given to us, we have neither                        duty, wealth tax, excise duty and cess which have
       come across nor have we been informed of any major

70      Omnitech InfoSolutions Limited
ANNEXURE                   To the Auditor’s Report (Contd.)
(Referred to in paragraph 3 of our report of even date)



            not been deposited on account of any dispute.           xvi. In our opinion, the term loans have been applied for the
            Company has paid income tax of Rs. 35.00 Lakhs                purpose for which they were raised.
            upto 31.03.2009 and additional Rs. 25.00 Lakhs till     xvii. On the overall examinations of the balance sheet of the
            date on account of dispute for the assessment year            company, in our opinion and according to information and
            2006-2007 for which assessment was completed                  explanations given to us, no instances of application of
            during the period under audit, raising a demand of            long term funds for short term purposes and short term
            Rs. 2.88 Crores. Company has preferred as appeal              fund for long term purposes were noticed.
            with Commissioner of Income Tax (Appeal) – VII on
                                                                    xviii. According to the information and explanations given to us,
            30.01.2009.
                                                                          the company has not made any preferential allotment of
x.     The company has neither accumulated losses as at 31st              equity shares to parties covered in the register maintained
       March 2009 nor it as incurred cash losses during the               under section under section 301 of the Act, hence the
       financial year ended on that date and the immediately              provisions of clause (xviii) are not applicable.
       preceding financial year.
                                                                    xix. The Company has not issued any debentures during
xi.    In our opinion and according to the information and                the year; hence the provisions of clause (xix) are not
       explanations given to us, the company has not defaulted            applicable.
       in repayments of dues to banks or financial institution as
                                                                    xx.   In our opinion, in respect of monies raised by way of public
       at balance sheet date.
                                                                          issue during the year, the management has disclosed the
xii.   In our opinion and according to information and                    end use of money raised and the same has been verified.
       explanations given to us, the company has not granted
                                                                    xxi. According to the information and explanations given to
       any loans and advances on the basis of security by way of
                                                                          us, no fraud on or by the company has been noticed or
       pledge of shares, debentures and other securities.
                                                                          reported during the course of our audit.
xiii. In our opinion, the company is not a chit fund or a nidhi
       mutual benefit fund/society. Therefore, the provisions of                                        For M/s. KOTHARI & KENIA
       clause 4(xiii) of the Companies (Auditor’s Report) Order,                                            [Chartered Accountants]
       2003 are not applicable to the company.
                                                                                                                                Sd/-
xiv. In our opinion, the company is not dealing in or trading
                                                                                                                 Nailesh R. Kothari
       in shares, securities, debentures and other investments
                                                                     Place : Mumbai                                          Partner
       except those investment which are held as investments.
       Accordingly the provisions of clause 4 (xiv) of the           Date : 25th May 2009                    Membership No. 42367
       companies (Auditor’s Report) are not applicable to the
       company.
xv.    According to information and explanation given to us, the
       company has not given any guarantee for loans taken by
       others from bank or financial institutions.




                                                                                                        Annual Report 2008-09      71
BALANCE SHEET as at 31st March 2009

                                                                                                                      Rupees
                                                                                              As at                     As at
                                                              Sch. No            31st March 2009            31st March 2008
SOURCES OF FUNDS
Shareholders Funds
Share Capital                                                     1               131,392,830.00              131,392,830.00
Reserves & Surplus                                                2             1,080,562,743.52              768,021,354.28
Equity Share Warrants                                             3                21,930,075.00                           -
Deferred Tax Liability                                                             65,885,573.55               28,142,754.77
Loan Funds
Secured Loans                                                     4               332,259,252.04               185,512,656.73
Unsecured Loan                                                                                  -                           -
                                                                                 1,632,030,474.11            1,113,069,595.78
APPLICATION OF FUNDS
Fixed Assets                                                      5               879,584,908.37               516,951,429.34
Less : Depreciation                                                               200,730,403.44              121,229,252.35
Net Block                                                                         678,854,504.93               395,722,176.99
Less : Impairment of Assets                                                           609,764.83                            -
                                                                                  678,244,740.10               395,722,176.99
Capital Work in Process                                                            79,349,497.70               99,675,082.24
Investments                                                       6               138,995,671.04              222,536,275.57
Current Assets, Loans and Advances
Receivables                                                       7                584,912,945.21             351,438,705.79
Cash & Bank Balance including Fixed Deposits                     8                  28,493,036.12              49,431,525.97
Inventories                                                       9               140,005,558.25               59,322,009.44
Loans and Advances                                               10                166,324,778.27              47,009,292.56
Sub Total                                                                          919,736,317.85             507,201,533.76
Current Liabilities and Provisions
Current Liabilities                                              11                51,875,715.51               68,210,408.67
Provisions                                                       12               133,021,824.35               45,249,435.39
Sub Total                                                                         184,897,539.86              113,459,844.06
Net Current Assets                                                                734,838,777.99              393,741,689.70
Misc Expenditure (to the extent not written off)
Preliminary Expenses                                                                   601,787.28                 1,394,371.28
                                                                                 1,632,030,474.11            1,113,069,595.78
Significant Accounting Policies & Notes on Accounts              19

The Schedules referred to above and the notes thereon form an integral part of the Balance Sheet.
As per our Report of even date.
For M/s. Kothari & Kenia                                         For and on Behalf of Board of Directors
Chartered Accountants
                                                                 Sd/-                                  Sd/-
(Nailesh R. Kothari)                                             (Atul Hemani)                         (Avinash Pitale)
Partner                                                          Managing Director                     Executive Director
M. No. 42367
                                                                 Sd/-
                                                                 (Gaurav Sharma)
                                                                 Company Secretary &
                                                                 Chief Officer (Compliance & Legal)
Place : Mumbai
Date : 25th May 2009

72   Omnitech InfoSolutions Limited
PROFIT & LOSS ACCOUNT for the year ended 31st March 2009

                                                                                                                       Rupees

                                                                                       Year ended                  Year ended
                                                               Sch. No            31st March 2009            31st March 2008
INCOME
Income from Operations                                                           1,714,262,235.32             1,315,636,073.19
Other Income                                                      13                21,851,195.76                10,790,522.82
(Loss)/Profit on Sale of Fixed Assets                                                           -                   (172,031.81)
Total Income                                                                     1,736,113,431.08            1,326,254,564.20
EXPENDITURE
Materials Consumed and Other Direct Expenses                      14               974,664,810.20               781,187,920.49
Staff Cost                                                        15               100,059,245.64               90,035,730.37
Administrative and Other Expenses                                 16                94,685,648.25               63,096,459.62
Selling and Distribution Expenses                                 17                30,717,083.37               29,536,368.22
Financial Expenses                                                18                37,904,033.21                24,594,143.95
Miscellaneous Expenditure Written Off                                                   792,584.00                  603,515.40
Total Expenditure                                                                1,238,823,404.67              989,054,138.05
Net Profit before Depreciation and Tax                                             497,290,026.41              337,200,426.15
Less : Depreciation                                                                  79,501,151.44              37,223,087.58
Net Profit before Tax                                                              417,788,874.97              299,977,338.57
Less : Provision for Taxation - Current Year                                        47,322,900.00               34,700,000.00
Less : Provision for Fringe Benefit Tax                                              1,735,000.00                 1,950,000.00
Less : Provision for Deferred Tax                                                   37,742,820.29                 7,592,934.00
Net Profit after Tax                                                               330,988,154.68              255,734,404.57
Less : Proposed Dividend                                                            15,767,140.00                15,767,140.80
Less : Dividend Tax                                                                   2,679,625.44                2,679,625.58
Less : Transfer to General Reserves                                                  8,500,000.00                6,500,000.00
Balance carried forward to Balance Sheet                                           304,041,389.24              230,787,638.19
Significant Accounting Policies & Notes on Accounts               19

The Schedules referred to above and the notes thereon form an integral part of the Profit & Loss Account.
As per our Report of even date.




For M/s. Kothari & Kenia                                         For and on Behalf of Board of Directors
Chartered Accountants
                                                                 Sd/-                                   Sd/-
(Nailesh R. Kothari)                                             (Atul Hemani)                          (Avinash Pitale)
Partner                                                          Managing Director                      Executive Director
M. No. 42367
                                                                 Sd/-
                                                                 (Gaurav Sharma)
                                                                 Company Secretary &
                                                                 Chief Officer (Compliance & Legal)
Place : Mumbai
Date : 25th May 2009

                                                                                                  Annual Report 2008-09       73
CASH FLOW STATEMENT for the year ended 31st March 2009

                                                                                        Rupees in lakhs
                                                                         Year ended         Year ended
                                                                     31st March 2009    31st March 2008

 A   CASH FLOW FROM OPERATING ACTIVITIES
     Net Profit/(Loss) before tax and extra ordinary items                  4,177.89           2,999.77
     Adjustments for :
     Depreciation                                                            795.01             372.23
     Finance Expenses                                                        379.04             245.94
     Interest Income                                                         (33.79)              (7.96)
     Miscellaneous Expenditure Written Off                                      7.93               6.04
     Dividend Recd                                                          (163.24)            (94.54)
     Loss/(Profit) on Sale of Fixed Assets                                          -              1.72
     Provision for diminuation in Value of Assets                              99.85                  -
     Acquisition Expenses                                                      39.54                  -
     Bad Debts                                                                 75.71                  -
     Unrealised Foreign Exchange Gain/Loss                                  (530.17)                  -
     Provision for impairment of Assets                                         6.10                  -
     Provision for Slow moving items                                            8.47                  -
     Operating Profit before Working Capital Changes           (A)         4,862.34            3,523.20
     Adjustments for changes in Working Capital :
     (Increase)/Decrease in Receivables                                   (2,334.74)           (979.38)
     (Increase)/Decrease in Other Current Assets                            (851.59)            (361.46)
     (Increase)/Decrease in Loans and Advances                            (1,030.04)           (328.70)
     Increase/(Decrease) in Trade & Other Payables                          (163.35)            365.29
     Increase/(Decrease) in Provision for Expenses                           693.26              116.72
                                                               (B)        (3,686.47)          (1,187.53)
     Cash Generated from Operations                          (A+B)          1,175.87           2,335.67
     Taxes (Paid)/Received (Net of TDS)                                      (163.11)          (342.40)
     Net Cash From Operating Activities                                     1,012.76           1,993.27




74   Omnitech InfoSolutions Limited
CASH FLOW STATEMENT for the year ended 31st March 2009 (Contd.)
                                                                                                          Rupees in lakhs
                                                                                         Year ended            Year ended
                                                                                    31st March 2009      31st March 2008

 B   CASH FLOW FROM INVESTING ACTIVITIES
     Purchase of Fixed Assets                                                             (2,629.58)            (2,415.42)
     Proceeds from Sale of Fixed Assets                                                                              36.71
     Capital Work in Progress                                                               (793.49)              (996.75)
     Dividend Recd                                                                            163.24                 94.54
     Interest Received (Revenue)                                                               33.79                     7.96
     Investment in Subsidiaries/Associates                                                    248.09               (200.11)
     Purchase of investment                                                               (5,062.36)             (5,921.47)
     Sale of Investments                                                                    5,649.68             3,993.00
     Net Cash used in Investing Activities                                                (2,390.64)            (5,401.54)
 C   CASH FLOW FROM FINANCING ACTIVITIES
     Net Proceeds From Long Term Borrowings                                                    (2.63)                21.33
     Net Proceeds From Short Term Borrowings                                                1,470.09                519.14
     Dividend Paid                                                                           (157.67)              (94.06)
     Dividend Tax                                                                             (26.80)               (15.99)
     Finance Expenses                                                                       (379.04)              (245.94)
     Proceeds From IPO                                                                              -              372.33
     Proceeds From Share Premium Net of Issue Exps.                                                 -            3,225.75
     Proceeds From Share Application against Share Warrants                                   219.30                        -
     Preliminary Expenses                                                                           -                (7.16)
     Net Cash Flow from Financing Activities                                                1,123.26              3,775.41
     Net Increase/(Decrease) in Cash & Cash Equivalents                (A+B+C)              (254.63)                367.14
     Cash and Cash Equivalents at the beginning of the year                                   405.89                 38.75
     Cash and Cash Equivalents at the end of the year                                         151.26               405.89




For M/s. Kothari & Kenia                                      For and on Behalf of Board of Directors
Chartered Accountants
                                                              Sd/-                                  Sd/-
(Nailesh R. Kothari)                                          (Atul Hemani)                         (Avinash Pitale)
Partner                                                       Managing Director                     Executive Director
M. No. 42367
                                                              Sd/-
                                                              (Gaurav Sharma)
                                                              Company Secretary &
                                                              Chief Officer (Compliance & Legal)
Place : Mumbai
Date : 25th May 2009

                                                                                              Annual Report 2008-09        75
SCHEDULES forming part of Balance Sheet as at 31st March 2009

                                                                                                                   Rupees
                                                                                                   As at              As at
                                                                                        31st March 2009    31st March 2008
 1.   SHARE CAPITAL
      Authorised Share Capital
      20,000,000 (20,000,000) Equity Shares of Rs. 10/- each                            200,000,000.00     200,000,000.00
      Issued, Subscribed and Paid up Share Capital
      13,139,283 (13,139,283) Equity Shares of Rs. 10/- each, fully paid up.             131,392,830.00     131,392,830.00
       i.    Of the above 3,024,820 (3,024,820) Equity Shares of Rs. 10/- each have
             been issued as fully paid up bonus shares by capitalisation of free
             reserves.
       ii.   Of the above 400,000 (400,000) equity shares of Rs.10/- each issued at a
             premium of Rs. 90/- per share on preferential basis.

      iii. Of the above 3,333,333 (3,333,333) equity shares of Rs. 10/- each issued
             at a premium of Rs. 95/- per share In IPO.
                                                                                         131,392,830.00     131,392,830.00

 2. RESERVES AND SURPLUS
      Share Premium
      Amount Brought Forward                                                             350,447,213.26     29,835,000.00
      Add: Additions During the Period                                                                 -    352,666,670.00
                                                                                         350,447,213.26     382,501,670.00
      Less : Utilised for writing off Issue Expenses                                                   -     32,054,456.74
                                                                                         350,447,213.26     350,447,213.26
      General Reserve
      Amount Brought Forward                                                               6,554,674.92          54,674.92
      Add: Additions During the Period                                                     8,500,000.00       6,500,000.00
                                                                                          15,054,674.92       6,554,674.92
      Profit and Loss Account
      Amount brought forward                                                              411,019,466.10    184,491,380.58
      Transferred from Profit and Loss A/c                                               304,041,389.24     230,787,638.19
                                                                                         715,060,855.34     415,279,018.77
      Less : Provision for Gratuity                                                                    -      2,065,182.35
      Less : Provision for Leave Encashment                                                            -      2,194,370.32
                                                                                         715,060,855.34      411,019,466.10
                                                                                        1,080,562,743.52    768,021,354.28




76    Omnitech InfoSolutions Limited
SCHEDULES forming part of Balance Sheet as at 31st March 2009 (Contd.)

                                                                                                                Rupees
                                                                                                As at              As at
                                                                                      31st March 2009   31st March 2008
3. EQUITY SHARE WARRANTS
   Upfront Consideration at 1,325,000 (Nil) Equity Warrants of Rs. 10 each to          21,930,075.00                   -
   be converted into one Equity Share at a premium of Rs. 155.51 in exercise of
   Warrant Holders on or before 4th January 2010
                                                                                       21,930,075.00                   -
4. SECURED LOANS
   i.     From Axis Bank Ltd.
          Term Loan                                                                     12,549,361.07      33,956,151.92
          (Secured against first charge on movable assets, current assets, mortgage
          of immovable properties of the company and personal guarantee of some
          of the Directors)
          [Amount due within one year is Rs. 12,549,361/- (Rs. 18,435,564/-)]
          Working Capital Demand Loan                                                               -    30,000,000.00
          (Secured against hypothecation of entire current assets, stocks and book
          debts of the Company)
          Cash Credit                                                                 123,074,936.25      48,443,052.21
          (Secured against hypothecation of entire current assets, stocks and book
          debts of the Company)
          Letter of Credit                                                              49,742,011.96     32,559,397.98
          (Secured against hypothecation of entire current assets, stocks and book
          debts of the Company)
   ii.    From Kotak Mahindra Bank Ltd.
          Vehicle Loan                                                                              -         52,180.13
          (Secured against hypothecation of Vehicle)
          [Amount due within one year is Nil (Rs. 52,180)]
   iii.   From Standard Chartered Bank Ltd.
          Cash Credit                                                                  25,106,408.59      40,143,264.49
          (Secured against hypothecation of stocks and book debts of the Company)

          Packing Credit in Foreign Currency                                           79,850,470.40                   -
          (Secured against hypothecation of stocks and book debts of the Company)
   iv.    From Hongkong and Shanghai Banking Corporation Ltd.
          Packing Credit in Foreign Currency                                            41,787,865.77                  -
          (Secured against hypothecation of entire current assets, stocks and book
          debts of the Company)
   v.     From ICICI Bank Ltd.

          Car Loans                                                                       148,198.00         358,610.00

          (Secured against hypothecation of Cars)
          [Amount due within one year is Rs. 148,198/- (197,640/-)]

                                                                                      332,259,252.04      185,512,656.73

                                                                                              Annual Report 2008-09   77
78
                                                                                                                                                                                                                               Rupees
                                 5.   FIXED ASSETS

                                                                                               Gross Block                                                       Depreciation                                    Net Block

                                      Assets                              Cost as at        Additions   Deduction            Cost as at           As at   For the year           On             As at            As at              As at
                                                                         31st March           during          during        31st March      31st March                    Deductions       31st March       31st March        31st March
                                                                              2008           the year        the year            2009            2008                                           2009             2009               2008
                                      Leasehold Land at MIDC          13,334,350.00                 -               -   13,334,350.00     1,025,720.00      205,144.00             -    1,230,864.00     12,103,486.00   12,308,630.00

                                      Buildings                       26,137,646.22       394,381.00                -   26,532,027.22     1,062,232.32      429,933.69             -     1,492,166.01    25,039,861.21    25,075,413.90

                                      Leasehold Land at Pune          28,360,904.00                 -               -   28,360,904.00       286,473.77      286,473.76             -      572,947.53     27,787,956.47   28,074,430.23




Omnitech InfoSolutions Limited
                                      Office Equipments                2,689,104.34     1,088,403.82                -     3,777,508.16     1,135,086.76     140,089.72             -     1,275,176.48     2,502,331.68       1,554,017.58

                                      Software & Software Products     3,605,950.57                 -               -    3,605,950.57     1,442,380.24       721,190.12            -     2,163,570.36     1,442,380.21       2,163,570.33

                                      Computer Systems               379,820,499.89 359,567,648.32                  -   739,388,148.21 106,329,499.90     72,375,376.61            -   178,704,876.51   560,683,271.70   273,490,999.99

                                      Furniture & Fixtures            55,602,167.32     1,583,045.89                -    57,185,213.21    5,493,903.08    3,598,762.95             -    9,092,666.03     48,092,547.18   50,108,264.24

                                      Vehicles                         2,850,807.00                 -               -    2,850,807.00     1,420,624.28      227,512.37             -     1,648,136.65     1,202,670.35       1,430,182.72

                                      Business Acquisition             4,550,000.00                 -               -    4,550,000.00     3,033,332.00     1,516,668.00            -    4,550,000.00                 -       1,516,668.00

                                      Total                          516,951,429.34 362,633,479.03                  - 879,584,908.37 121,229,252.35       79,501,151.44            - 200,730,403.57 678,854,504.80       395,722,176.99

                                      Previous Year                  283,263,900.85    241,542,270.29 7,854,741.80      516,951,429.34    88,018,149.76 37,223,087.58 4,011,984.99 121,229,252.35                    -                  -
                                                                                                                                                                                                                                            SCHEDULES forming part of Balance Sheet as at 31st March 2009 (Contd.)
SCHEDULES forming part of Balance Sheet as at 31st March 2009 (Contd.)

                                                                                                                  Rupees
                                                                                                 As at              As at
                                                                                       31st March 2009   31st March 2008

6. INVESTMENTS
   Short Term Investments (Trade - Quoted)
   Birla Sunlife Income Plus Growth Fund [51,097.18 units of Rs. 39.1411/- each,         2,000,000.00                   -
   Market Value as on 31.03.09 is Rs.2,023,928.641/- Previous Year (Rs. Nil)]
   Birla Sunlife Income Plus Quarterly Dividend [637187.96 units of Rs. 11.7199           7,126,246.30                  -
   each, Market Value as on 31.03.09 is Rs. 7,126,246.3/- Previous Year (Rs. Nil)]
   DSP Blackrock Bond Fund - Growth Fund [335,739.46 units of Rs. 29.785/-                9,749,907.78                  -
   each, Market Value as on 31.03.09 is Rs. 9,749,907.78/- Previous Year (Rs. Nil)]
   DSP Blackrock Floating Rate Fund [304,431.245 units of Rs. 14.1247/- each,            4,300,000.00                   -
   Market Value as on 31.03.09 is Rs. 4,307,001.925/- Previous Year (Rs. Nil)]
   ICICI Prudential Institutional Income Plan - Quarterly Dividend [870,537.45          46,546,262.78                   -
   units of Rs. 11.9171/- each and 3,194,425.267 units of Rs. 12.487/- each, Market
   Value as on 31.03.09 is Rs. 46,546,262.78/- Previous Year (Rs. Nil)]
   Reliance Income Fund Quarterly Dividend [2,113,583.73 units of Rs. 14.1983            27,459,891.18                  -
   each, Market Value as on 31.03.09 is Rs. 27,459,891.18/- Previous Year (Rs. Nil)]
   Reliance Income Fund Monthly Dividend [1,425,497.41 units of Rs. 11.4871/-            14,558,319.93                  -
   each, Market Value as on 31.03.09 is Rs. 14,558,319.93/- Previous Year (Rs. Nil)]
   UTI Bond Fund Growth [890,561.66 units of Rs. 28.12/- each, Market Value as          22,373,847.75                   -
   on 31.03.09 is Rs. 22,373,847.75/- Previous Year (Rs. Nil)]
   Birla Interval Income Fund Series-1 Monthly Plan (6,100,000 units of Rs. 10/-                     -      61,000,000.00
   each, Market Value as on 31.03.08 is Rs. 61,087,230/-)
   Birla Sunlife Interval Fund-Quarterly Series II (3,563,248.964 units of Rs. 10                    -      35,632,618.54
   each, Market Value as on 31.03.08 is Rs. 35,703,754/-)
   Birla Sunlife Liquid Plus Daily Dividend (4,418,377.216 units of Rs. 10.006/-                     -      44,213,817.07
   each, Market Value as on 31.03.08 is Rs. 4,4213,817/-)
   Reliance Monthly Internal Fund Series I Institutional Dividend Plan                               -     52,000,000.00
   (5,195,635.666 units of Rs. 10.0084/- each, Market Value as on 31.03.08 is
   Rs. 52,030,654/-)
   [Aggregate amount of Quoted Investments Aggregate                                    134,114,475.72     192,846,435.61
   Market Value Rs.134,145,406.29/- (Previous Year Rs. 193,035,455)]
   Long Term Investment (Other than traded - Unquoted)
   12709 Shares of Bombay Mercantile Co-op Bank Ltd of Rs. 30/- each fully paid up         381,270.00          381,270.00
   Nil (98) shares of BD 50/- each of DRC Gulf WLL allotted and balance shares of                    -      24,863,738.64
   BD 50/- each to be allotted
   31300 (30000) shares of USD 1/- each of Omnitech Technologies Inc, USA                 1,293,365.00       1,238,271.00
   160 (160) shares of YEN 50000/- each of Omnitech TSB Co. Ltd, Japan                   3,206,560.32        3,206,560.32
   [Aggregate amount of unquoted investments Rs. 48,81,195/-                              4,881,195.32      29,689,839.96
   (Previous Year Rs. 2,96,89,840/-)]
                                                                                        138,995,671.04     222,536,275.57




                                                                                                Annual Report 2008-09   79
SCHEDULES forming part of Balance Sheet as at 31st March 2009 (Contd.)

                                                                                                                  Rupees
                                                                                                  As at              As at
                                                                                        31st March 2009   31st March 2008

7.   SUNDRY DEBTORS (UNSECURED, CONSIDERED GOOD)
     Debts outstanding for a period exceeding six months                                332,958,489.00      52,833,916.65
     Other Debtors                                                                       251,954,456.21    298,604,789.14
                                                                                         584,912,945.21    351,438,705.79
8.   CASH AND BANK BALANCES
     Cash-in-hand                                                                          1,161,305.17      2,046,987.08
     Balances with Scheduled Banks
     On Current Accounts                                                                  13,965,090.95     38,493,401.89
     On Deposit Accounts                                                                  13,329,946.00      8,854,443.00
     On Margin Money Accounts                                                                36,694.00          36,694.00
                                                                                          28,493,036.12     49,431,525.97
9.   INVENTORIES
     Finished Goods                                                                     140,005,558.25      59,322,009.44
     (Inventory valued at cost or market value whichever is lower and as certified by
     the management)
                                                                                        140,005,558.25      59,322,009.44
10. LOANS AND ADVANCES (UNSECURED , CONSIDERED GOOD)
     Advances recoverable in cash or in kind or for value to be received                 157,999,736.82      38,706,250.11
     Deposits                                                                              8,325,041.45      8,303,042.45
                                                                                         166,324,778.27     47,009,292.56

11. CURRENT LIABILITIES
     Sundry Creditors                                                                    22,435,363.28      53,303,551.78
     Unpaid Dividend                                                                         731,441.20                  -
     Duties & Taxes                                                                       21,612,668.03      12,941,715.89
     Deposits Received                                                                     7,096,243.00       1,965,141.00
                                                                                          51,875,715.51     68,210,408.67
12. PROVISIONS
     Provision For Expenses                                                               14,391,266.91      16,833,819.81
     Provision For Gratuity                                                                 850,893.00       2,956,193.00
     Provision For Leave Encashment                                                        1,378,139.00      2,673,285.00
     Provision For Income Tax                                                            92,999,760.00       3,179,339.20
     Provision For FBT                                                                    4,955,000.00       1,160,032.00
     Provision For Proposed Dividend                                                      15,767,140.00      15,767,140.80
     Provision For Dividend Tax                                                            2,679,625.44      2,679,625.58
                                                                                        133,021,824.35      45,249,435.39



80   Omnitech InfoSolutions Limited
SCHEDULES forming part of the Profit & Loss Account For The Year
Ended 31st March 2009

                                                                                      Rupees
                                                               Year ended         Year ended
                                                           31st March 2009   31st March 2008

13. OTHER INCOME
    Interest Income                                           3,379,426.67         795,919.00
    Miscellaneous Receipts                                    2,148,206.15         540,205.16
    Dividend from Mutual Funds on short term investments     16,323,562.94       9,454,398.66
                                                             21,851,195.76      10,790,522.82


14. OPERATIONAL EXPENSES
    Cost of Sales                                          950,655,978.86      768,067,712.50
    Consumable Spares Parts and Stores                        1,888,593.70       1,880,467.14
    Transportation                                              43,787.80          153,431.68
    Technical Repairs and Service Charges                   22,076,449.84        11,086,309.17
                                                           974,664,810.20      781,187,920.49

15. STAFF COST
    Salaries & Bonus                                        88,882,538.64       77,970,170.37
    PF & ESIC Contribution                                   2,763,288.00        3,068,319.00
    Remuneration to WholeTime Directors                       8,278,419.00       8,852,241.00
    Sitting Fees to Non-Executive Directors                    135,000.00         145,000.00
                                                           100,059,245.64       90,035,730.37

16. ADMINISTRATION AND OTHER EXPENSES (CONTD.)
    Conveyance                                                 906,867.01         840,053.45
    Rent, Rates and Taxes                                    11,192,177.00       5,439,014.00
    Communication Cost                                        6,201,467.14       4,263,880.57
    Legal and Professional Charges                          49,970,336.60       32,730,285.46
    Postage & Courier                                          426,059.24          275,314.16
    Printing & Stationery                                     1,576,776.16       1,231,756.52
    Diwali and Pooja Expenses                                  378,925.00           12,795.00
    Office Maintenance                                        1,233,406.50          427,121.81
    Electricity Charges                                       3,293,751.00       2,286,337.00
    Insurance                                                  243,786.75          550,107.00
    Vehicle Maintenance Expenses                                825,119.46       1,514,083.08
    Books & Periodicals                                          14,341.25          10,754.00
    Filing Fees                                                 42,070.00         285,624.00
    License Renewal Fees                                        30,500.00           24,130.00
    Fuel Charges                                                378,167.49                   -
    Provision for Impairment of Assets                         609,764.18                    -


                                                                    Annual Report 2008-09   81
SCHEDULES forming part of the Profit & Loss Account For The Year
Ended 31st March 2009 (Contd.)

                                                                              Rupess
                                                        Year ended         Year ended
                                                    31st March 2009   31st March 2008

16. ADMINISTRATION AND OTHER EXPENSES (CONTD.)
     Provision for diminuation in Value of Assets      9,984,703.21                 -
     Membership & Subscription                           357,111.00        277,042.00
     Office Expenses                                   3,654,759.61      3,708,055.42
     Packing Expenses                                     5,406.00           2,650.00
     Recruitment Expenses                              1,299,162.96       2,017,315.10
     Registration Expenses                               45,857.00          90,000.00
     Claim against performance guarantee              1,022,045.00       5,352,158.97
     Stock Exchange Expenses                             75,317.00        1,264,146.00
     Miscellaneous Expenses                              917,771.69       493,836.08
                                                     94,685,648.25      63,096,459.62
17. SELLING AND DISTRIBUTION EXPENSES
     Transportation Outward                            2,084,169.48      2,486,970.70
     Travelling Expenses                               6,756,673.68      5,323,917.01
     Advertisement Expenses                             650,770.00         199,400.00
     Acquisition Expenses                              3,953,511.00                  -
     Bad Debts                                         7,571,444.37     13,945,473.97
     Discount                                          3,523,217.84       2,761,137.45
     Business Promotion Expenses                      2,459,038.69        2,418,918.27
     Commission on Sales                                306,018.00         876,903.00
     Rentals Computers                                1,000,206.00         771,558.82
     Tender Expenses                                      8,000.00           1,598.00
     Value Added Tax Paid/Sales Tax                    1,743,339.51             10.00
     Exhibition & Conference Expenses                   660,694.80         750,481.00
                                                     30,717,083.37      29,536,368.22
18. FINANCIAL EXPENSES
     Interest Paid
     On Term Loan                                    27,489,844.89       3,860,566.00
     On Cash Credit & Demand Loan                                 -     10,700,628.97
     On Other Loans                                               -      4,835,541.19
     Processing Charges & Other Finance Cost          3,630,068.28        586,027.00
     Bank Charges                                      3,518,985.41      2,476,881.04
     L C Charges                                       3,265,134.63      2,134,499.75
                                                     37,904,033.21      24,594,143.95




82   Omnitech InfoSolutions Limited
SCHEDULES To The Profit & Loss Accounts & Balance Sheet

19. SIGNIFICANT ACCOUNTING POLICIES AND NOTES ON ACCOUNTS
    A.   Significant Accounting Policies
         1.   Basis of preparation of Financial Statements
              i.      The financial statements have been prepared under historical cost convention on the accrual basis of
                      accounting in accordance with the accounting principles generally accepted in India (GAAP) and in compliance
                      with the Accounting Standards issued by The Institute of Chartered Accountants of India and the provisions of
                      the Companies act, 1956 as adopted consistently by the Company.
              ii.     Accounting policies not specifically referred to otherwise are consistent with the generally accepted accounting
                      principles followed by the Company.
              iii.    The preparation of financial statements in conformity with the generally accepted accounting principles
                      requires estimates and assumptions to be made, that affect the reported amounts of assets and liabilities
                      on the date of financial statements and the reported amounts of revenues and expenses during the reported
                      year. Differences between the actual results and estimates are recognized in the year in which the results are
                      known/materialized.
         2.   Revenue recognition
              i.      Revenue from sales in respect of hardware is recognized when they are completed with passing of the title
                      and are exclusive of sales tax, octroi and other incidental expenses.
              ii.     Revenue from software development is recognized in accordance with the percentage of completion
                      method and revenue from sale of licenses of software products and other products is recognized on
                      delivery/installation, as the case may be.
              iii.    Revenue from IT infrastructure networking, annual service contracts and facilities management services is
                      deferred and recognized ratably over the period of the underlying maintenance agreement.
              iv.     Interest Income is recognized on a time proportion basis taking into account the amount outstanding and the
                      rate applicable.
              v.      Dividend Income is recognized when the shareholders’ right to receive payment is established by the Balance
                      Sheet Date.
         3.   Expenditure
              Expenses are accounted on accrual basis and the provisions are made for all known losses and liabilities. No
              provisions are made towards likely expenses on providing post-sales client support for fixed priced contracts as well
              as in respect of annual technical service contracts in so far as it pertains to the period beyond the current accounting
              year.
         4.   Fixed Assets and Depreciation
              i.      Fixed Assets
                      a.   Fixed assets are stated at their original cost of acquisition including incidental expenses related to
                           acquisition & installation of the concerned assets less accumulated depreciation and impairment
                           losses, if any.
                      b.   Costs that are directly associated with identifiable and unique software products controlled by the
                           Company, whether developed in-house or acquired, and have probable economic benefits exceeding
                           the cost are recognized as product development.
                      c.   Assets acquired under lease are at cost of acquisition including incidental expenses related to
                           acquisition & installation of such assets.
                      d.   Advances paid towards acquisition of fixed assets and the cost of assets not ready for use as at the
                           Balance Sheet date are disclosed under capital work-in-progress.




                                                                                                       Annual Report 2008-09        83
SCHEDULES To The Profit & Loss Accounts & Balance Sheet (Contd.)

19. SIGNIFICANT ACCOUNTING POLICIES AND NOTES ON ACCOUNTS (CONTD.)
              ii.     Depreciation/Amortization
                      a.   Depreciation on Software is provided based on Management’s estimate of useful life of Software
                           however subject to maximum period of 5 years. Depreciation on Fixed Assets other than Land and
                           those mentioned above has been provided on Straight Line Method at the following rates:
                           Asset Group                                                                               Rates (SLM)
                           Computer Systems                                                                                 16.21%
                           Furniture & Fixtures                                                                             6.33%
                           Vehicles                                                                                         9.50%
                           Office Equipments                                                                                   4.75%
                           Office Premises                                                                                     1.63%
                      b.   Product Development Expenses capitalized are amortized over its useful life for a period not
                           exceeding ten years.
                      c.   Leasehold assets are amortized over the period of lease.
                      d.   Miscellaneous expenditure is amortized over a period of 5 years from the year in which it has been
                           incurred.
         5.   Impairment of Assets
              Fixed assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying
              amount of an asset may not be recoverable. Whenever the carrying amount of an asset exceeds its recoverable
              amount, an impairment loss is recognized in the income statement for items of fixed assets carried at cost. The
              recoverable amount is higher of an assets net selling price and value in use. The net selling price is the amount
              obtained from the sale of an asset in an arm’s length transaction while value in use is the present value of estimated
              future cash flows expected to arise from the continuing use of an asset, from its disposal at the end of its useful
              life.
        6.    Inventories
              Inventories have been valued on the following basis:
              i.      Raw Materials, packing material, stores and spares     -   At cost
              ii.     Work-in-progress                                       -   At cost plus appropriate allocation of overheads
              iii.    Finished Goods                                         -   At cost plus appropriate allocation of overheads
                                                                                 or net realizable value, whichever is lower
         7.   Investments
              Investments are classified into current investment and long term investments. Current investments are stated
              at lower of cost or fair market value. Long Term Investments are stated at cost less provision for permanent
              diminution in value if any, of investments.
         8.   Foreign Exchange Transactions
              Transactions denominated in foreign currencies are normally recorded at the exchange rate prevailing at the
              time of the transaction. Realized gains and losses on settlement of foreign currency transactions are recognized
              in the Profit and Loss account. Foreign currency assets and liabilities at the year end are translated at the year
              end exchange rates and the resultant exchange difference is recognized in the Profit and Loss Account. Exchange
              differences relating to fixed assets are adjusted in the cost of the respective assets.




84   Omnitech InfoSolutions Limited
SCHEDULES To The Profit & Loss Accounts & Balance Sheet (Contd.)

19. SIGNIFICANT ACCOUNTING POLICIES AND NOTES ON ACCOUNTS (CONTD.)
        9.   Research & Development
             i.      Revenue expenditure on R&D is charged of to profit & loss account in the year in which it is incurred where
                     the Company is not certain of realizing future economic benefits from such activities.
             ii.     Capital expenditure on R&D is included under the relevant fixed assets.
        10. Employee Benefits
             i.      Short Term Employee Benefits
                     All short term employee benefits such as salaries, wages, bonus, medical benefits which fall due within 12
                     months of the period in which the employee renders the related services are charged to the profit and loss
                     account.
             ii.     Long Term & Post- Employment Benefits
                     a.   Defined Contribution Plan
                          Company’s contribution paid/payable during the year towards Provident Fund Scheme, ESIC is
                          recognized in the Profit & Loss Account.
                     b.   Defined Benefit Plan
                          The Company’s Gratuity Benefit Scheme is a defined benefit plan. The Company’s liability for gratuity is
                          determined by actuarial valuation made at the end of each financial year using the projected unit credit
                          method. Actuarial gains and Losses are immediately recognized in Profit & Loss Account as income and
                          expense.
        11. Borrowing Costs
             Borrowing costs directly attributable to acquisition, construction and production of qualifying assets are capitalized
             as a part of the cost of such asset up to the date of completion. Other borrowing costs are charged to the Profit &
             Loss Account.
        12. Deferred Tax
             Deferred Income taxes reflects the impact of current year timing differences between taxable income and
             accounting income for the year and reversal of timing differences of earlier years. The differences that result
             between the profit considered for income taxes and the profit as per the financial statements are identified and
             thereafter a deferred tax asset or deferred tax liability is recorded for timing differences, namely the differences
             that originate in one accounting period and reverse in another, based on the tax effect of the aggregate amount
             being considered. The tax effect is calculated on the accumulated timing differences at the end of an accounting
             period based on prevailing enacted or substantially enacted regulations. Deferred tax assets are recognized only
             if there is reasonable certainty of their realization and are reviewed for the appropriateness of their respective
             carrying values at each Balance Sheet date.
        13. Provision for Tax
             Provision for current tax is determined on the basis of estimated taxable income for the period as per the provisions
             of Income Tax Act, 1961. Fringe Benefit Tax is provided in accordance with the provisions of the Income Tax Act,
             1961.
        14. Earnings per Share (EPS)
             The earnings considered in ascertaining the Company’s EPS are computed as per Accounting Standard 20 on
             “Earning per Share”, issued by the Institute of Chartered Accountants of India. The number of shares used in
             computing basic EPS is the weighted average number of shares outstanding during the period. The diluted EPS is
             calculated on the same basis as basic EPS, after adjusting for the effects of potential dilutive equity shares unless
             the effect of the potential dilutive equity shares is anti-dilutive.
        15. Provision and Contingent Liabilities
             Provisions are recognized and computed in accordance with Accounting Standard 29 on “Provisions, Contingent
             Liabilities and Contingent Assets” issued by the Institute of Chartered Accountants of India i.e. they are recognized


                                                                                                     Annual Report 2008-09      85
SCHEDULES To The Profit & Loss Accounts & Balance Sheet (Contd.)

19. SIGNIFICANT ACCOUNTING POLICIES AND NOTES ON ACCOUNTS (CONTD.)
               if the following conditions are satisfied:
               i.     The Company has a present obligation as a result of past event;
               ii.    It is probable that an outflow of resources embodying economic benefits will be required to settle the
                      obligation; and
               iii.   A reliable estimate can be made of the amount of the obligation.
               Similarly, the Contingent liabilities are disclosed in Accordance with the Accounting Standard 29 i.e. they are
               disclosed when the Company has a possible obligation or a present obligation and it is probable that a Cash Outflow
               will not be required to settle the obligation.
          16. Leases
               Lease arrangements where the risks and rewards incident to ownership of an asset substantially vest with the
               lessor, are recognised as operating leases. Lease rentals under operating leases are recognised in the profit and
               loss account on a straight-line basis over the period of lease.
     B.   Notes To The Accounts
          1.   The previous year’s figures have been recast/restated, wherever necessary, to confirm to current year’s
               classification.
          2.   Contingent Liabilities                                                                           Rupees In Lakhs
                                                                                                            2009              2008
                i.    Contingent Liability Outstanding guarantees given by banks in favor of                34.24            25.54
                      various government authorities and others
                ii.   Capital Commitments Estimated amount of contracts remaining                               -           325.00
                      To be executed on capital account and Not provided for
                      (net of advances)

          3.    Income Tax Authorities have made demand of Income Tax amounting to Rs. 288 Lakhs for the Financial Year
                2005-06, which the Company has disputed and is in appeal before Commissioner of Income Tax (Appeal) – VII.
                An amount of Rs. 60 Lakhs has been paid against the demand as above
          4.   Change in Method of Accounting
               Till the year ended 31st March, 2008, the company was providing depreciation on software @ 16.21 % on Straight
               Line method as specified under Schedule XIV to the Companies Act, 1956 However in line with Accounting
               Standard 26 (Accounting for Intangibles) of ICAI, from the year 2008-2009, value of software purchased is
               depreciated over its useful life retrospectively. As a result,
               i.     Additional Depreciation pertaining to earlier years charged against Current Profits           Rs.15.01 Lakhs
               ii.    Additional Depreciation pertaining to current year charged against Current Profits            Rs.12.26 Lakhs
               Had this change not been made in method of accounting, the current profits
               would have been higher by Rs. 27.27 Lakhs.
          5.   Managerial Remuneration                                                                          Rupees in Lakhs
                                                                                        2009                                  2008

               i.     To Executive Directors:
                      Basic Salary                                                   47.77                                   65.84

                      Contribution to PF                                                 2.01                                  1.71

                      Other Perquisites & Allowances                                 33.00                                   20.97

                      TOTAL                                                          82.78                                   88.52

               ii.    To Non-Executive Directors:
                      Directors’ sitting fees                                            1.35                                  1.45

86   Omnitech InfoSolutions Limited
SCHEDULES To The Profit & Loss Accounts & Balance Sheet (Contd.)

19. SIGNIFICANT ACCOUNTING POLICIES AND NOTES ON ACCOUNTS (CONTD.)
        5.     Managerial Remuneration (Contd.)                                                              Rupees in Lakhs
               Computation of Net profit in accordance with the Section 349 of the Companies Act, 1956 for Calculation
               of Remuneration Payable to Directors


        Profit before Depreciation as per Profit & loss Account                                                      4,972.90
             Add :
             1. Directors’ Remuneration                                                                                   82.78
             2. Loss on Sale of Assets                                                                                           -

                                                                                                                     5,055.68
             Less :
             1. Profit on sale of Assets                                                                                         -
             2. Depreciation under Section 350                                                                            795.01
                Net Profit computed under Section 349                                                                4,260.67

                Maximum Permissible Remuneration payable to Managing Director and Whole Time                               10%
                Directors under Section 309 (3)
                Maximum Permissible Managerial Remuneration                                                              426.06

        6.    Foreign exchange Income & Expenditure                                                            Rupees in Lakhs
                                                                                                     2009                  2008
              Foreign Exchange Income:
              Export Sales                                                                       5,212.95                2907.13
              Foreign Exchange Expenditure:
              Software Purcheses:                                                                2,669.09                2297.25
              Expenditure on Foreign Travel                                                         38.63                  32.65
              Other Expenditure                                                                       7.35                       -

        7.    Major components of deferred tax liabilities                                                     Rupees in Lakhs
                                                                                                     2009                  2008
              Due to difference between book depreciation and tax depreciation                     284.56                 210.88
              Expenses allowable on payments and others                                             (7.14)                 (2.04)

        8.    Payment to Auditors                                                                              Rupees in Lakhs
                                                                                                     2009                  2008
              Audit fees                                                                              3.75                  2.50
              Taxation Matters                                                                        3.07                       -
              Certification & Other Matters                                                           5.50                  3.25
              For Service Tax                                                                         1.52                   0.71




                                                                                                 Annual Report 2008-09      87
SCHEDULES To The Profit & Loss Accounts & Balance Sheet (Contd.)

19. SIGNIFICANT ACCOUNTING POLICIES AND NOTES ON ACCOUNTS (CONTD.)
         9.   Dues to Micro, Small and Medium Enterprises
              The Company has not received any memorandum (as required to be filed by the Suppliers with the notified
              authorities under the Micro, Small and Medium Enterprises Development Act, 2006) claiming their status as on
              31st March 2009 as micro, small or medium Enterprises. Consequently the amount paid/payable to these parties
              during the year is nil.
         10. Balances standing to the account of the debtors, creditors, advances, receivables and deposits are subject
              to confirmations
         11. Earnings Per Share
                                                                                                     F.Y.                  F.Y.
                                             PARTICULARS                                        31st March 2009       31st March 2008
              Face Value Per Share (Rs.)                                                              10                    10
              i.     Weighted average number of Equity shares
                     a.   Number of Equity Shares at the Beginning of the year                    1,31,39283            94,05,950
                     b.   Number of Equity Shares at the End of the year                          1,31,39283            1,18,75,394
                          Weighted average number of Equity Shares
                     c.                                                                           1,31,39283            1,18,75,394
                          Outstanding During the year (On annualized basis)
              ii.    Net Profit after tax available for Equity Shareholders (Rs. In Lakhs)         3,309.88              2,557.34
              iii.   Basic and diluted earnings per share (in Rs) (annualized)                       25.19                 21.46

         12. Related Party Disclosures
              i.     List of Parties where control exists, irrespective of transactions
                     a.   Subsidiary Companies
                          1.    Omnitech Technologies Inc., USA;
                          2.    Omnitech TSB Co. Limited, Japan
                     b.   Associates/Joint Ventures
                          1.    DRC Gulf W.L.L., Bahrain
                          2.    Omni Gulf Technologies W.L.L., Bahrain
                     c.   Key Management Personnel
                          1.    Mr. Atul Hemani – Managing Director
                          2.    Mr. Avinash Pitale – Executive Director
                          3.    Mr. Devarshi Buch – Executive Director
                     d.   Relatives of Key Management Personnel
                          1.    Mrs. Amisha A. Hemani                                     6.    Mr. Maganlal Hemani
                          2.    Mrs. Vanita Hemani                                        7.    Ms. Sheetal Pitale
                          3.    Mr. Nirav Hemani                                          8.    Mr. Nitish Pitale
                          4.    Ms. Vidhi Hemani                                          9.    Mrs. Shubhangi Pitale
                          5.    Mr. Bharat Hemani                                         10.   Mrs. Beejal D. Buch
                     e.   Enterprises owned or significantly influenced by Key Management Personnel or their relatives
                          1.    Omnitech Technologies Limited, India
                          2.    Wintel Computers Private Limited
                          3.    Atul Hemani HUF
                          4.    Avinash Pitale HUF
                          5.    Omnitech Employees’ Welfare Trust
                     f.   Fellow Subsidiary Companies
                          1.    Arham Technologies Co. Ltd.


88   Omnitech InfoSolutions Limited
                        19.   SIGNIFICANT ACCOUNTING POLICIES AND NOTES ON ACCOUNTS (CONTD.)
                              ii.   Following are the transactions entered into with the related parties:

                                                                                                                                                                                                         Rupees in Lakhs
                                    Sr.   Description of Transaction          Subsidiary Companies             Key Management             Relatives of Key            Enterprises owned or          Fellow Subsidiary
                                    No.                                                                           Personnel            Management Personnel          significantly influenced          Companies
                                                                                                                                                                      by Key Management
                                                                                                                                                                       Personnel or their
                                                                                                                                                                            relatives
                                                                             Year ended      Year ended Year ended       Year ended    Year ended   Year ended       Year ended    Year ended Year ended      Year ended
                                                                             31st March      31st March     31st March   31st March    31st March   31st March       31st March    31st March 31st March      31st March
                                                                                   2009            2008          2009         2008          2009             2008         2009           2008         2009          2008

                                     1    Remuneration
                                          Mr. Atul Hemani                               -               -       27.86         30.01             -                -             -                -         -             -
                                          Mr. Avinash Pitale                            -               -       26.86         29.12             -                -             -                -         -             -
                                          Mr. Devarshi Buch                             -               -       28.06         29.38             -                -             -                -         -             -
                                     2    Sitting Fees**
                                          Mr. Maganlal Hemani                           -               -            -             -        0.20             0.25              -                -         -             -
                                     3    Dividend Paid
                                          Mr. Atul Hemani                               -               -        21.76        18.14             -                -             -                -         -             -
                                          Mr. Avinash Pitale                            -               -       16.54         13.79             -                -             -                -         -             -
                                          Mr. Devarshi Buch                             -               -        2.88           2.40            -                -             -                -         -             -
                                          Mrs. Amisha A. Hemani                         -               -            -             -        11.85            9.88              -                -         -             -
                                          Mrs. Vanita Hemani                            -               -            -             -        0.30             0.25              -                -         -             -
                                          Mr. Nirav Hemani                              -               -            -             -         0.91            0.76              -                -         -             -
                                          Ms. Vidhi Hemani                              -               -            -             -         0.91            0.76              -                -         -             -
                                          Mr. Bharat Hemani                             -               -            -             -         0.01             0.01             -                -         -             -
                                          Mr. Maganlal Hemani                           -               -            -             -         0.12             0.10             -                -         -             -
                                          Ms. Sheetal Pitale                            -               -            -             -         0.91            0.76              -                -         -             -
                                          Mr. Nitish Pitale                             -               -            -             -         0.91            0.76              -                -         -             -
                                          Mrs. Shubhangi Pitale                         -               -            -             -        17.27            14.39             -                -         -             -
                                          M/s. Atul Hemani HUF                          -               -            -             -            -                -         0.91           0.76            -             -




Annual Report 2008-09
                                          M/s. Avinash Pitale HUF                       -               -            -             -            -                -         0.91           0.76            -             -
                                                                                                                                                                                                                            SCHEDULES To The Profit & Loss Accounts & Balance Sheet (Contd.)




89
90
                                 19. SIGNIFICANT ACCOUNTING POLICIES AND NOTES ON ACCOUNTS (CONTD.)

                                    ii.   Following are the transactions entered into with the related parties (Contd.)

                                                                                                                                                                                                                 Rupees in Lakhs
                                          Sr.   Description of Transaction          Subsidiary Companies             Key Management               Relatives of Key            Enterprises owned or          Fellow Subsidiary
                                          No.                                                                              Personnel           Management Personnel          significantly influenced          Companies
                                                                                                                                                                              by Key Management
                                                                                                                                                                               Personnel or their
                                                                                                                                                                                    relatives

                                                                                   Year ended      Year ended Year ended          Year ended   Year ended   Year ended       Year ended    Year ended Year ended      Year ended




Omnitech InfoSolutions Limited
                                                                                   31st March       31st March    31st March      31st March   31st March   31st March       31st March    31st March 31st March      31st March
                                                                                          2009            2008            2009         2008         2009             2008         2009           2008         2009          2008

                                                M/s. Wintel Computers Private                 -               -               -            -            -               -          9.20           7.67            -             -
                                                Limited
                                                M/s. Omnitech Employees'                      -               -               -            -            -               -          1.80           1.20            -             -
                                                Welfare Trust
                                           4    Convertible Warrants*
                                                Mr. Atul Hemani (100000                       -               -           16.55            -            -               -              -                -         -             -
                                                warrants)
                                                Mr. Avinash Pitale (100000                    -               -           16.55            -            -               -              -                -         -             -
                                                warrants)
                                                Mr. Devarshi Buch (100000                     -               -           16.55            -            -               -              -                -         -             -
                                                warrants)
                                                M/s. Wintel Computers Private                 -               -                            -            -               -        132.41                 -         -             -
                                                Limited (800000 warrants)
                                           5    Investment
                                                Omnitech Technologies Inc.,               0.55            0.42                -            -            -               -              -                -         -             -
                                                USA
                                           6    Professional Fees
                                                Mrs. Beejal D. Buch                           -               -               -            -            -             1.14             -                -         -             -
                                           7    Recovery of Expenses
                                                Arham Technologies Co. Ltd.                   -               -               -            -            -               -              -                -         -         3.54
                                                *This reflects 10% of exercise price (Rs. 165.51 per warrant) received from the related parties at the time of issue of warrants in accordance with the relevant SEBI
                                                                                                                                                                                                                                    SCHEDULES To The Profit & Loss Accounts & Balance Sheet (Contd.)




                                                 Guidelines.
                                                **This excludes the sitting fees paid to Independent Directors as per Accounting Standard Interpretation 21 issued by the Institute of Chartered Accountants of India.
SCHEDULES To The Profit & Loss Accounts & Balance Sheet (Contd.)

19. SIGNIFICANT ACCOUNTING POLICIES AND NOTES ON ACCOUNTS (CONTD.)
        13.   Disclosure of loans/advances and investments in its own shares in terms of Clause 32 of Listing
              Agreement with Stock Exchanges

                                                                                                                    Rupees In Lakhs
        Sr. .         Particulars                                                     Name of            Amount          Maximum
        No                                                                        the Parent/     Outstanding          amount due
                                                                                   Associate/          as on 31st        at any one
                                                                                   Subsidiary     March 2009           time during
                                                                                     Company                               the year
              1       Loan and Advances in the nature of loans to Subsidiaries                -               Nil               Nil
              2       Loan and Advances in the nature of loans to Associates                  -               Nil               Nil
              3       Loans and advances in the nature of loans where there                   -               Nil               Nil
                      is no repayment schedule or repayment beyond seven
                      years
              4       Loans and advances in the nature of loans where                         -               Nil               Nil
                      there is no interest or interest below section 372A of
                      Companies Act, 1956

              5       Loans and advances in the nature of loans to firms/                    -                Nil               Nil
                      companies in which directors are interested
              Note: Investments by the loanee in the shares of parent company and subsidiary company, when the
                       company has made a loan or advance in the nature of loan - N.A
        14.   Status of Deployment of Funds raised in IPO
              The status of deployment of funds raised by the Company in IPO as on 31st March 2009 is as under:


              Sr. No Particulars                                                                                    Rupees in Lakhs
                  A     Fund Received                                                                                      3,500.00
                  B     Utilization of Fund
                          a.   Issue related expenses                                                                        405.60
                          b.   Strategic Investments                                                                          89.55
                          c.   Enhancement of Existing Facilities and setting up new centers/offices                       1,579.32
              Total Utilization                                                                                            2,074.47

              Balance of unutilized funds out of IPO lying in liquid funds/escrow a/c                                      1,425.53




                                                                                                       Annual Report 2008-09      91
SCHEDULES To The Profit & Loss Accounts & Balance Sheet (Contd.)
19. SIGNIFICANT ACCOUNTING POLICIES AND NOTES ON ACCOUNTS (CONTD.)
         15. Remittance of Dividend in Foreign Currency
              During the year, the Company has not remitted any amount in foreign currencies on account of dividends and
              does not have information as to the extent to which remittances, if any, in foreign currencies on account of
              dividends have been made by/on behalf of non-resident shareholders. The particulars of dividends payable to
              non-resident shareholders which were declared during the year are as under.

               Sr.      Particulars                                                            Year ended on 31st March,2009
               No.
               i.       Number of non-resident Shareholders                                                                    112
               ii.      Number of Equity Shares held by them                                                            52,890
               iii.     Gross amount of dividends (Rs. In Lakhs)                                                             0.63
               iv.      Year to which the Dividend relates                                                            2007-08
         16. Retirement Benefits
              The employee’s gratuity fund scheme is managed by Life Insurance Corporation of India. The said scheme is a
              defined benefit scheme. The present obligation is based upon actuarial valuation using the projected unit credit
              method. The summary of computation of present obligation, actuarial gain/loss etc. is as under:
                                                                                                                 Amount (in Rs.)
              i.      Reconciliation of Opening and Closing Balances of Defined Benefit Obligation
                      Present value of obligations as at beginning of year                                             2,103,046
                      Interest cost                                                                                      168,244
                      Current Service Cost                                                                               836,289
                      Benefits Paid                                                                                              0
                      Actuarial (gain)/Loss on obligations                                                              (361,652)
                      Present value of obligations as at end of year                                                   2,745,927
              ii.     Reconciliation of Opening and Closing Balances of Fair Value of Plan Assets
                      Fair value of plan assets at beginning of year                                                             0
                      Expected return on plan assets                                                                             0
                      Contributions                                                                                          56,042
                      Benefits paid                                                                                              0
                      Actuarial Gain / (Loss) on Plan assets                                                                   NIL
                      Fair value of plan assets at the end of year                                                           56,042
              iii.    Fair value of plan assets
                      Fair value of plan assets at beginning of year                                                             0
                      Actual return on plan assets                                                                               0
                      Contributions                                                                                          56,042
                      Benefits Paid                                                                                              0
                      Fair value of plan assets at the end of year                                                           56,042
                      Funded status                                                                                  (2,689,885)
                      Excess of Actual over estimated return on plan assets                                                    NIL
                      (Actual rate of return = Estimated rate of return as ARD falls on 31st March)




92   Omnitech InfoSolutions Limited
SCHEDULES To The Profit & Loss Accounts & Balance Sheet (Contd.)
19. SIGNIFICANT ACCOUNTING POLICIES AND NOTES ON ACCOUNTS (CONTD.)
        16. Retirement Benefits (Contd.)                                                                          Amount (in Rs.)
             iv.    Actuarial Gain/Loss recognized
                    Actuarial gain/(Loss) for the year - Obligation                                                       361,652
                    Actuarial (gain)/Loss for the year - plan assets                                                          NIL
                    Total (gain)/Loss for the year                                                                       (361,652)
                    Actuarial (gain)/Loss recognized in the year                                                        (361,652)
              v.    The amounts to be recognized in the Balance Sheet and Statement of profit and loss
                    Present value of obligations as at the end of year                                                  2,745,927
                    Fair value of plan assets as at the end of the year                                                    56,042
                    Funded status                                                                                     (2,689,885)
                    Amount recognized in balance sheet                                                                 2,689,885
              vi.   Expenses Recognised in statement of Profit & loss
                    Current Service cost                                                                                 836,289
                    Interest Cost                                                                                         168,244
                    Expected return on plan assets                                                                                 0
                    Net Actuarial (gain)/Loss recognised in the year                                                    (361,652)
                    Expenses recognised in statement of Profit & loss                                                     642,881
              vii. Assumptions
                    Discount Rate                                                                                             8%
                    Salary Escalation                                                                                         3%

        17. Impairment of Assets
             In accordance with Accounting Standard 28 issued by ICAI, the Company has made a provision of Rs. 6.10 Lakhs
             for impairment against Fixed Assets during the year ended on 31st March 2009.
        18. Equity Share Warrants
             During the Financial year ended on 31st March 2009, the Company allotted 1,325,000 warrants convertible
             into one Equity Share for each warrant to the following persons including some of the Promoters at a price of
             Rs. 165.51 each in accordance with the SEBI (DIP) Guidelines and other applicable laws and Special Resolution
             passed by Shareholders at their Annual General Meeting held on 13th June 2008 :

              Sr. No.    Name of Allottee                                                                        Nos of Warrants
              1          Wintel Computers Private Limited                                                                800,000
              2          Atul Hemani                                                                                     100,000
              3          Avinash Pitale                                                                                  100,000
              4          Devarshi Buch                                                                                   100,000
              5          Nikul Shah                                                                                       50,000
              6          Anuradha Shah                                                                                    50,000
              7          Meticulous Fiscal Company Private Limited                                                        75,000
              8          Sanjay Asher                                                                                     50,000
                         Total                                                                                         1,325,000
         Till 31st March 2009, none of the warrant holders have exercised their right to convert the warrants into Equity Shares
         Further, 10% of price of warrants, which was received by the Company at the time of allotment of warrants has been
         fully utilised by the Company towards expansion of technology centres.
                                                                                                    Annual Report 2008-09          93
SCHEDULES To The Profit & Loss Accounts & Balance Sheet (Contd.)

19. SIGNIFICANT ACCOUNTING POLICIES AND NOTES ON ACCOUNTS (CONTD.)
         19. Sale of Investment made in DRC Gulf WLL
             During the Financial Year ended on 31st March 2009, the Company sold its investment in DRC Gulf WLL.,
             Bahrain. This was due to lack of required profitability in that business.
         20. Derivative Instruments
             The Company uses Forward Contracts to hedge against its Foreign Exchange Exposure. The Company does not
             enter into any derivative instruments for Trading or Speculative purposes. As on 31st March 2009, there are no
             outstanding Forward Contracts.
         21. Segmental Reporting
             The Company is mainly engaged in the business of Information Technology and Information Technology enabled
             services. Considering the nature of business and financial reporting of the Company, the Company has only one
             segment viz. Information Technology.
             The Company operates in Local and Export geographically of which export sales have amounted to Rs. 5,212.95
             Lakhs. But due to nature of business, the assets/liabilities and expenses thereof cannot be bifurcated separately.
         22. Investment in Mutual Funds
             During the year the Company invested the surplus funds for short periods in the following Liquid/Cash Mutual
             Fund Schemes:
              Particulars            Balance as on 1st April       Purchased/Reinvested        Sold/redeemed during the       Balance as on 31st March
                                             2008                     during the year                    year                          2009
                                       No. of        Rs. In         No. of        Rs. In         No. of        Rs. In         No. of Units       Rs. In
                                       Units         Lakhs          Units         Lakhs          Units         Lakhs                             Lakhs
              Birla Sun life                    -              -      51,097.18      20.00                 -              -      51,097.18          20.00
              Income Plus
              Growth Fund
              Birla Sun life                    -              -   1,281,503.44     150.08      644,315.48          77.00      637,187.96            71.26
              Income Plus Qtly
              Dividend
              Birla Sun life         4,418,377.22       442.14     3,768,052.71     377.06     8,186,429.93        819.20                    -            -
              Savings Fund – Inst
              Birla Sun life Short              -              -   3,961,119.25     396.33      3,961,119.26      396.33                     -            -
              Term Fund
              Birla Sun life         3,563,248.96      356.33        40,335.98      364.39 3,603,584.94           360.36                     -            -
              Interval Income
              Fund -Quarterly
              Series II
              Birla Sun life         6,100,000.00       610.00                -            -   6,100,000.00        610.00                    -            -
              Interval Income
              Fund -Monthly
              Series I
              DSP Black Rock                    -              -    335,739.47      100.00                 -              -    335,739.47           97.50
              Bond Fund -
              Growth Fund
              DSP Black Rock                    -              -   2,452,905.11     343.00     2,148,473.87        301.17      304,431.25           43.00
              Floating Rate Fund
              Reliance Income                   -              -   2,113,583.73     300.09                 -              - 2,113,583.73           274.60
              Fund - Qtly
              Dividend
              Reliance Monthly       5,195,635.67      520.00                 -            -   5,195,635.67       520.00                     -            -
              Interval Fund
              UTI Treasury                      -              -     25,039.55      250.45       25,039.55        250.45                     -            -
              Advantage Fund
              UTI Fixed Income                  -              -   3,911,184.10      391.12     3,911,184.10       391.12                    -            -
              Interval Fund
              Templeton                         -              -     61,486.65       615.10       61,486.65        615.10                    -            -
              Treasury
              Management
              Account



94   Omnitech InfoSolutions Limited
SCHEDULES To The Profit & Loss Accounts & Balance Sheet (Contd.)

19. SIGNIFICANT ACCOUNTING POLICIES AND NOTES ON ACCOUNTS (CONTD.)
          22. Investment in Mutual Funds (Contd.)
               Particulars          Balance as on 1st April        Purchased/Reinvested           Sold/redeemed during the       Balance as on 31st March
                                               2008                    during the year                       year                          2009
                                      No. of          Rs. In         No. of        Rs. In           No. of          Rs. In       No. of Units       Rs. In
                                      Units           Lakhs          Units         Lakhs            Units           Lakhs                           Lakhs
               Templeton India                   -             -   6,201,766.04          621.34   6,201,766.04          621.34                  -             -
               Ultra short bond
               fund
               Reliance Income                   -             -    1,425,497.41         162.87              -               - 1,425,497.41           145.58
               Fund
               UTI Bond Fund -                   -             -     890,561.66      250.45                  -               -    890,561.66          223.74
               Growth
               LICMF Floating                    -             -   1,728,280.19          175.40   1,728,280.19          175.53                  -             -
               Rate Fund
               LICMF Interval                    -             -   6,373,215.04          637.77   6,373,215.04         637.55                   -             -
               Fund
               LICMF Liquid Plus                 -             -   5,319,405.04          531.94   5,319,405.04          531.94                  -             -
               Fund
               ICICI Prudential                  -             -   1,354,913.74      393.89       1,354,913.74         403.64                   -             -
               Institutional
               Income Plan
               ICICI Prudential                  -             -   3,732,657.30          394.67   3,732,657.30          394.67                  -             -
               Flexible Income
               Plan
               ICICI Prudential                  -             -   3,881,685.77          391.13   3,881,685.77          391.13                  -             -
               Interval Fund I-
               Monthly Dividend
               ICICI Prudential                  -             -   3,938,843.90      393.89 3,938,843.90               393.89                   -             -
               Interval Fund
               - Institutional
               Dividend
               ICICI Interval                    -             -   4,863,525.00      486.35 4,863,525.00               486.35                   -             -
               Fund II
               ICICI Prudential                  -             -    870,537.45           103.79              -               -    870,537.45           99.68
               Institutional
               Income Plan
               ICICI Prudential                  -             -   3,194,425.27      398.54                  -               - 3,194,425.27           365.78
               Institutional
               Income Plan

               TOTAL               19,277,261.85      1,928.46 61,777,360.97       8,249.67 71,231,561.45            8,380.81 9,823,061.37           1,341.14




For M/s. Kothari & Kenia                                                       For and on Behalf of Board of Directors
Chartered Accountants
                                                                               Sd/-                                              Sd/-
(Nailesh R. Kothari)                                                           (Atul Hemani)                                     (Avinash Pitale)
Partner                                                                        Managing Director                                 Executive Director
M. No. 42367
                                                                               Sd/-
                                                                               (Gaurav Sharma)
                                                                               Company Secretary &
                                                                               Chief Officer (Compliance & Legal)
Place : Mumbai
Date : 25th May 2009

                                                                                                                         Annual Report 2008-09               95
BALANCE SHEET ABSTRACT AND COMPANY’S GENERAL BUSINESS PROFILE

1. Registration Details

     Registration No.                    :   L 3 0 0 0 7 M H 1                 9   9    0   P L C 0 5 5 2 5 6

     Balance Sheet Date                  :   3   1     0 3       2 0 0 9               State                   :                        1 1

2. Capital Raised During The Year (Rs. in Lakhs)

     Public Issue                        :                   N I     L                 Right Issue             :                    N I L

     Bonus Issue                         :                   N I     L                 Private Placement       :                    N I L

3. Position Of Mobilisation & Deployment Of Funds (Rs. in Lakhs)

     Total Liabilities                   :   1   6 3 2 0     .   3 0                   Total Assets            :   1 6 3 2 0        .   3 0

     Sources of Funds

     Paid-up Capital                     :       1 3 1 3     .   9 3                   Reserves and Surplus :      1 0 8 0 5        .   6 3

     Secured Loan                        :       3 3 2 2     .   5 9                   Unsecured Loan          :                    N I L

     Equity Share Warrants               :           2 1 9   .   3 0                   Deferred Tax Liability :          6 5 8      .   8 5

     Application of Funds

     Net Fixed Assets                    :       6 7 8 2     .   4 4                   Investments             :      1 3 8 9       .   9 6

     Net Current Assets                  :       7 3 4 8     .   3 9                   Misc. Expenditure       :                6   .   0 2

     Capital WIP                         :           7 9 3   .   4 9                   Accumulated Losses                           N I L

4. Performance Of Company (Rs. in Lakhs)

     Turnover/Income from Operations :       1   7   1 4 2   .   6 2                   Total Expenditure       :   1 2 3 8 8        .   2 3

     Profit/(Loss) Before Tax            :       4 1 7 7     .   8 9                   Profit/(Loss) After Tax :      3 3 0 9       .   8 8

     Earning per share                   :             2 5   .   1 9                   Dividend Rate           :                    1 2 %

5 Generic Names of Three Principal Products/Services of Company (as per monetary terms)

     Item Code No.                       :               N .     A   .

     Production Description              :               N .     A   .




For M/s. Kothari & Kenia                                                 For and on Behalf of Board of Directors
Chartered Accountants
                                                                         Sd/-                                      Sd/-
(Nailesh R. Kothari)                                                     (Atul Hemani)                             (Avinash Pitale)
Partner                                                                  Managing Director                         Executive Director
M. No. 42367
                                                                         Sd/-
                                                                         (Gaurav Sharma)
                                                                         Company Secretary &
                                                                         Chief Officer (Compliance & Legal)
Place : Mumbai
Date : 25th May 2009

96      Omnitech InfoSolutions Limited
SUMMARISED FIANANCIALS OF SUBSIDIARY COMPANY PURSUANT TO SECTION 212(8) OF THE COMPANIES ACT, 1956

                                                                                                                                                                   Rupees. in Lakhs
                       a) No of equity shares                b) Extent of Holding                    Not dealt with in the Accounts of the Dealt with in the Accounts of the
                           at the end of the                                                     Company                                         Company
                           financial year of the
                           Subsidiary                                                                             (i)                     (ii)               (i)                   (ii)

SI.     Name of the          Omnitech               Other         Omnitech             Other       For Subsidiary’s           For previous                 For          For previous
                         Infosolutions
NO       Subsidiary                            Subsidiary      Infosolutions      Subsidiary         Financial Year         Financial years      Subsidiary’s         Financial years
                                   Ltd
                                           Companies                      Ltd    Companies        ended 31st March            of Subsidiary           Financial         of Subsidiary
                                                                                                             20099        since it became a       Year ended        since it became a
                                                                                                                                  subsidiary      31st March               subsidiary
                                                                                                                                                          2009



 1        Omnitech             30000                   --             100%                  --                   --                       --           (14.73)                     --
      Technologies
           Inc. USA

 2    Omnitech TSB                160                 80            66.67%          33.33%                       --                       --            (6.26)                     --
      Co Ltd, Japan


STATEMENT PURSUANT TO SECTION 212 (1) (e) OF THE COMPANIES ACT, 1956 AS ON MARCH 31, 2009
                                                                                                                                                                   Rupees. in Lakhs
 Sr        Name of          Issued &       Reserves &              Total             Total       Investments             Profit       Turnover                Profit Profit after
No       Subsidiary       Subscribed               Surplus       Assets         Liabilities                             & Loss                               before         taxation
                              Capital                                                                                   account                            Taxation
 1        Omnitech              12.10              (14.72)         0.28              0.28                   --           (1.87)                  --           (1.87)           (1.87)
      Technologies
           Inc. USA
 2        Omnitech
       TSB Co. Ltd.,
             Japan
             48.10             (6.26)               64.93         64.93             29.95            (12.94)             30.47           (12.94)            (12.94)




                                                                                                                                                 Annual Report 2008-09                    97
              CONSOLIDATED FINANCIAL STATEMENTS




98   Omnitech InfoSolutions Limited
AUDITORS’ REPORT

To The Board of Directors of                                        Till the year March, 2008 the company was providing
OMNITECH INFOSOLUTIONS LIMITED                                      depreciation on software @ 16.21 % on Straight Line
Omnitech House, A/13, Cross Road, No 5,                             method as specified under Schedule XIV to the Companies
                                                                    Act, 1956. However in line with Accounting Standard 26
Kondivita Road, Marol, M.I.D.C., Andheri (East),
                                                                    (Accounting for Intangibles) of ICAI, from the year 2008-
Mumbai – 400 093.
                                                                    2009, value of software purchased is depreciated over its
We have examined the attached Consolidated Balance Sheet            useful life retrospectively. But for the change as above
of OMNITECH INFOSOLUTIONS LTD (the Company) and its                 the depreciation would have been higher and profit would
subsidiary, OMNITECH TECHNOLOGIES INC. & OMNITECH                   have been lower by, Rs. 15.02 Lakhs for the year earlier
TSB CO. LTD (subsidiaries) as at 31st March 2009 and the            years and depreciation would have been lower and profit
Consolidated Profit & Loss Account and the Consolidated             would have been higher by, Rs. 12.26 Lakhs for the year
Cash Flow Statement for the year ended on that date annexed         current year.
thereto.
                                                                    On the basis of information and explanation given to us, and
These financial statements are the responsibility of the            on consideration of the separate audit reports on individual
company’s management. Our responsibility is to express an           audited financial statements of the company and unaudited
opinion on these financial statements based on our audit. We        figures of its subsidiaries, in our opinion that the consolidated
conducted our audit in accordance with the auditing standards       financial statements give a true and fair view in conformity with
generally accepted in India. Those standards require that we plan   the accounting principles generally accepted in India:
and perform the audit to obtain reasonable assurance whether
                                                                    a.   In case of the Consolidated Balance Sheet, of the
the financial statements are prepared in all material respects,
                                                                         consolidated state of affairs of the Company and its
in accordance with the financial reporting framework generally
                                                                         subsidiaries as at 31st March 2009;
accepted in India and are free of material misstatement. An
                                                                    b.   In case of the Consolidated Profit & Loss Account, of the
audit includes examining, on a test basis, evidence supporting
                                                                         consolidated results of operations of the Company and its
the amounts and disclosures in the financial statements. An
                                                                         subsidiaries for the year ended on that date; and
audit also includes assessing the accounting principles used
and significant estimates made by the management, as well as        c.   In case of Consolidated Cash Flow Statement, of
evaluating the overall financial statements. We believe that our         the consolidated cash flows of the Company and its
audit provides a reasonable basis of our opinion.                        subsidiaries for the year ended on that date.

We report that the Consolidated Financial Statements have
been prepared by the Company in accordance with the
requirements of Accounting Standard (AS) 21, Consolidated
Financial Statements, issued by The Institute of Chartered                                                For M/s. Kothari & Kenia
Accountants of India and on the basis of separate Audited                                                   Chartered Accountants
Financial statements of the Company and unaudited figures
                                                                                                                Nailesh R. Kothari
of its subsidiaries included in the Consolidated Financial
                                                                    Place : Mumbai                                           Partner
Statements, subject to the following, and read with point no.
                                                                    Date : 25th May, 2009                Membership No: 042367
4 of notes to accounts on Standalone Financial Statements
of the Company.




                                                                                                      Annual Report 2008-09       99
BALANCE SHEET as at 31st March 2009

                                                                                                                     Rupees
                                                                                             As at                     As at
                                                              Sch. No            31st March 2009            31st March 2008
SOURCES OF FUNDS
Shareholders Funds
Share Capital                                                     1               131,392,830.00              131,392,830.00
Minority Interest                                                                    1,394,443.14                1,672,675.19
Reserves & Surplus                                               2              1,078,600,643.99               767,108,681.77
Currency Translation Reserve                                                          525,355.45                            -
Equity Share Warrants                                            3                 21,930,075.00                            -
Deferred Tax Liability                                                             65,885,573.55                28,142,754.77
Loan Funds
Secured Loans                                                    4                332,259,252.04               185,512,656.73
Unsecured Loan                                                   5                   1,886,291.13                  201,309.00
                                                                                1,633,874,464.30             1,114,030,907.46
APPLICATION OF FUNDS
Fixed Assets                                                      6               879,584,908.37              516,951,429.34
Less : Depreciation                                                               200,730,403.44              121,229,252.35
Net Block                                                                         678,854,504.93              395,722,176.99
Less : Impairment of Assets                                                           609,764.83                           -
                                                                                  678,244,740.10              395,722,176.99
Capital Work in Process                                                            79,349,497.70               99,675,082.24
Investments                                                       7               137,490,293.26              221,085,991.79
Current Assets, Loans and Advances
Receivables                                                      8                588,706,053.97             355,068,875.65
Cash & Bank Balance including Fixed Deposits                      9                 29,137,205.65             49,533,323.47
Inventories                                                      10               140,005,558.25              59,322,009.44
Loans and Advances                                               11                166,445,274.63              47,117,211.56
Sub Total                                                                         924,294,092.51              511,041,420.12
Current Liabilities and Provisions
Current Liabilities                                              12                53,084,122.20               69,638,699.57
Provisions                                                       13               133,021,824.35              45,249,435.39
Sub Total                                                                         186,105,946.55              114,888,134.96
Net Current Assets                                                                738,188,145.96              396,153,285.16
Miscellaneous Expenditure (to the extent written off)
Preliminary Expenses                                                                  601,787.28                  1,394,371.28
                                                                                1,633,874,464.30             1,114,030,907.46
Significant Accounting Policies & Notes on Accounts              20

The Schedules referred to above and the notes thereon form an integral part of the Balance Sheet.
As per our Report of even date.

For M/s. Kothari & Kenia                                         For and on Behalf of Board of Directors
Chartered Accountants
                                                                 Sd/-                                  Sd/-
(Nailesh R. Kothari)                                             (Atul Hemani)                         (Avinash Pitale)
Partner                                                          Managing Director                     Executive Director
M. No. 42367
                                                                 Sd/-
                                                                 (Gaurav Sharma)
                                                                 Company Secretary &
                                                                 Chief Officer (Compliance & Legal)
Place : Mumbai
Date : 25th May 2009

100   Omnitech InfoSolutions Limited
PROFIT & LOSS ACCOUNT for the year ended 31st March 2009

                                                                                                                      Rupees
                                                                                        Year ended                 Year ended
                                                               Sch. No             31st March2009            31st March 2008

INCOME
Income from Operations                                                            1,717,309,051.57            1,319,882,533.56
Other Income                                                      14                  21,852,471.95              10,805,821.76
(Loss)/Profit on Sale of Fixed Assets                                                              -               (172,031.81)
Total Income                                                                      1,739,161,523.52            1,330,516,323.51
EXPENDITURE
Materials Consumed and Other Direct Expenses                      15               978,275,646.85              783,343,957.56
Staff Cost                                                        16                100,629,668.79               91,659,127.99
Administrative and Other Expenses                                 17                  95,099,177.46              64,421,821.24
Selling and Distribution Expenses                                 18                  30,717,083.37             29,536,368.22
Financial Expenses                                                19                  37,913,343.38              24,594,143.95
Miscellaneous Expenditure Written Off                                                   792,584.00                 603,515.40
Total Expenditure                                                                1,243,427,503.85              994,158,934.36
Net Profit before Depreciation and Tax                                             495,809,336.67              336,357,389.15
Less : Depreciation                                                                   79,501,151.44             37,223,087.58
Net Profit before Tax                                                               416,308,185.23              299,134,301.57
Less : Provision for Taxation - Current Year                                          47,322,900.00             34,700,000.00
Less : Provision for Fringe Benefit Tax                                                1,735,000.00               1,950,000.00
Less : Provision for Deferred Tax                                                     37,742,820.29               7,592,934.00
Net Profit after Tax before Minority Interest                                      329,507,464.94               254,891,367.57
Less : Minority Interest                                                                (431,262.71)                 69,635.51
Net Profit after Tax after Minority Interest                                       329,938,727.66              254,821,732.06
Less : Proposed Dividend                                                              15,767,140.00              15,767,140.80
Less : Dividend Tax                                                                    2,679,625.44               2,679,625.58
Less : Transfer to General Reserves                                                   8,500,000.00               6,500,000.00
Balance carried forward to Balance Sheet                                            302,991,962.22             229,874,965.68
Significant Accounting Policies & Notes on Accounts               20


The Schedules referred to above and the notes thereon form an integral part of the Profit & Loss Account.
As per our Report of even date.



For M/s. Kothari & Kenia                                          For and on Behalf of Board of Directors
Chartered Accountants
                                                                  Sd/-                                  Sd/-
(Nailesh R. Kothari)                                              (Atul Hemani)                         (Avinash Pitale)
Partner                                                           Managing Director                     Executive Director
M. No. 42367
                                                                  Sd/-
                                                                  (Gaurav Sharma)
                                                                  Company Secretary &
                                                                  Chief Officer (Compliance & Legal)
Place : Mumbai
Date : 25th May 2009

                                                                                                   Annual Report 2008-09 101
CASH FLOW STATEMENT for the year ended 31st March 2009

                                                                                                 Rupees
                                                                          Year ended         Year ended
                                                                      31st March 2009    31st March 2008

 A    CASH FLOW FROM OPERATING ACTIVITIES
      Net Profit/(Loss) before tax and extra ordinary items                  4,163.08           2,992.03
      Adjustments for :
      Depreciation                                                             795.01            372.23
      Finance Expenses                                                         379.13            245.94
      Interest Income                                                         (33.80)              (7.96)
      Miscellaneous Expenditure Written Off                                      7.93               6.04
      Dividend Recd                                                          (163.24)            (94.54)
      Loss/(Profit) on Sale of Fixed Assets                                          -               1.72
      Share of Minority Interest in profit                                      (2.78)             (0.69)
      Provision for diminuation in Value of Assets                              99.85                   -
      Acquisition Expenses                                                      39.54                   -
      Bad Debts                                                                 75.71                   -
      Unrealised Foreign Exchange Gain/Loss                                  (521.90)                   -
      Provision for impairment of Assets                                         6.10                   -
      Provision for Slow moving items                                            8.47                   -
      Operating Profit before Working Capital Changes           (A)          4,853.11           3,514.77
      Adjustments for changes in Working Capital :
      (Increase)/Decrease in Receivables                                   (2,336.37)          (1,015.68)
      (Increase)/Decrease in Other Current Assets                            (851.59)            (361.46)
      (Increase)/Decrease in Loans and Advances                             (1,030.17)          (329.78)
      Increase/Decrease) in Trade & Other Payables                           (166.27)             379.57
      Increase/Decrease) in Provision for Expenses                             693.26             116.72
                                                                (B)         (3,691.14)         (1,210.63)
      Cash Generated from Operations                          (A+B)          1,161.97           2,304.14
      Taxes (Paid)/Received (Net of TDS)                                      (163.11)          (342.40)
      Net Cash From Operating Activities                                      998.85             1,961.74
 B    CASH FLOW FROM INVESTING ACTIVITIES
      Purchase of Fixed Assets                                             (2,629.58)          (2,415.42)




102   Omnitech InfoSolutions Limited
CASH FLOW STATEMENT for the year ended 31st March 2009 (Contd.)

                                                                                                                  Rupees
                                                                                         Year ended            Year ended
                                                                                   31st March 2009       31st March 2008

     Proceeds from Sale of Fixed Assets                                                             -                36.71
     Capital Work in Progress                                                               (793.49)              (996.75)
     Dividend Recd                                                                            163.24                94.54
     Interest Received (Revenue)                                                               33.80                     7.96
     Investment in Subsidiaries / Associates                                                  248.64              (185.61)
     Purchase of investment                                                               (5,062.36)            (5,921.47)
     Sale of Investments                                                                    5,649.68             3,993.00
     Net Cash used in Investing Activities                                                (2,390.09)            (5,387.04)
 C   CASH FLOW FROM FINANCING ACTIVITIES
     Net Proceeds From Long Term Borrowings                                                    (2.63)               21.33
     Net Proceeds From Short Term Borrowings                                                1,488.95                521.16
     Dividend Paid                                                                          (157.67)               (94.06)
     Dividend Tax                                                                            (26.80)               (15.99)
     Finance Expenses                                                                       (379.13)              (245.94)
     Proceeds From IPO                                                                              -              372.33
     Proceeds From Share Premium Net of Issue Exps.                                                 -            3,225.75
     Proceeds From Share Application against Share Warrants                                   219.30                        -
     Proceeds From Share of Minority Interest                                                       -               16.03
     Preliminary Expenses                                                                           -                (7.16)
     Net Cash Flow from Financing Activities                                                1,142.03             3,793.46
     Net Increase /(Decrease) in Cash & Cash Equivalents               (A+B+C)              (249.21)               368.16
     Cash and Cash Equivalents at the beginning of the year                                   406.91                38.75
     Cash and Cash Equivalents at the end of the year                                         157.71               406.91




For M/s. Kothari & Kenia                                      For and on Behalf of Board of Directors
Chartered Accountants
                                                              Sd/-                                  Sd/-
(Nailesh R. Kothari)                                          (Atul Hemani)                         (Avinash Pitale)
Partner                                                       Managing Director                     Executive Director
M. No. 42367
                                                              Sd/-
                                                              (Gaurav Sharma)
                                                              Company Secretary &
                                                              Chief Officer (Compliance & Legal)
Place : Mumbai
Date : 25th May 2009

                                                                                              Annual Report 2008-09 103
SCHEDULES forming part of Balance Sheet as at 31st March 2009

                                                                                                                      Rupees
                                                                                                      As at             As at
                                                                                           31st March 2009    31st March 2008
 1.   SHARE CAPITAL
      Authorised Share Capital
      20,000,000 (20,000,000) Equity Shares of Rs. 10/- each                               200,000,000.00     200,000,000.00
      Issued, Subscribed and Paid up Share Capital
      13,139,283 (13,139,283) Equity Shares of Rs. 10/- each, fully paid up.                131,392,830.00     131,392,830.00
       i.    Of the above 3,024,820 (3,024,820) Equity Shares of Rs. 10/- each have been
             issued as fully paid up bonus shares by capitalisation of free reserves.
       ii.   Of the above 400,000 (400,000) equity shares of Rs.10/- each issued at
             a premium of Rs.90/- per share on preferential basis.
      iii. Of the above 3,333,333 (3,333,333) equity shares of Rs. 10/- each issued at
             a premium of Rs.95/- per share In IPO.
                                                                                            131,392,830.00     131,392,830.00
 2. RESERVES AND SURPLUS
      Share Premium
      Amount Brought Forward                                                                350,447,213.26      29,835,000.00
      Add : Additions During the Period                                                                   -    352,666,670.00
                                                                                            350,447,213.26     382,501,670.00
      Less : Utilised for writing off Issue Expenses                                                      -     32,054,456.74
                                                                                            350,447,213.26     350,447,213.26
      General Reserve
      Amount Brought Forward                                                                  6,554,674.92          54,674.92
      Add : Additions During the Period                                                       8,500,000.00       6,500,000.00
                                                                                             15,054,674.92        6,554,674.92
      Profit and Loss Account
      Amount brought forward                                                                410,106,793.59     184,491,380.58
      Transferred from Profit and Loss A/c                                                  302,991,962.22     229,874,965.68
                                                                                            713,098,755.81      414,366,346.26
      Less : Provision for Gratuity                                                                       -      2,065,182.35
      Less : Provision for Leave Encashment                                                               -       2,194,370.32
                                                                                            713,098,755.81      410,106,793.59
                                                                                           1,078,600,643.99     767,108,681.77




104   Omnitech InfoSolutions Limited
SCHEDULES forming part of Balance Sheet as at 31st March 2009 (Contd.)

                                                                                                                Rupees
                                                                                                As at             As at
                                                                                      31st March 2009   31st March 2008

3. EQUITY SHARE WARRANTS
   Upfront Consideration at 1,325,000 (Nil) Equity Warrants of Rs. 10 each to be       21,930,075.00                  -
   converted into one Equity Share at a premium of Rs. 155.51 in exercise of
   Warrant Holders on or before 4th January 2010
                                                                                       21,930,075.00                  -
4. SECURED LOANS
   i.     From Axis Bank Ltd.
          Term Loan                                                                     12,549,361.07     33,956,151.92
          (Secured against first charge on movable assets, current assets, mortgage
          of immovable properties of the company and personal guarantee of some
          of the Directors) [Amount due within one year is Rs. 12,549,361/- (Rs.
          18,435,564/-)]
          Working Capital Demand Loan                                                               -    30,000,000.00
          (Secured against hypothecation of entire current assets, stocks and book
          debts of the Company)
          Cash Credit                                                                 123,074,936.25      48,443,052.21
          (Secured against hypothecation of entire current assets, stocks and book
          debts of the Company)
          Letter of Credit                                                              49,742,011.96     32,559,397.98
          (Secured against hypothecation of entire current assets, stocks and book
          debts of the Company)
   ii.    From Kotak Mahindra Bank Ltd.
          Vehicle Loan                                                                              -         52,180.13
          (Secured against hypothecation of Vehicle)
          [Amount due within one year is Nil (Rs. 52,180.13)]
   iii.   From Standard Chartered Bank Ltd.
          Cash Credit                                                                  25,106,408.59      40,143,264.49
          (Secured against hypothecation of stocks and book debts of the Company)
          Packing Credit in Foreign Currency                                           79,850,470.40                  -
          (Secured against hypothecation of stocks and book debts of the Company)
   iv.    From Hongkong and Shanghai Banking Corporation Ltd.
          Packing Credit in Foreign Currency                                            41,787,865.77                 -
          (Secured against hypothecation of entire current assets, stocks and book
          debts of the Company)
   v.     From ICICI Bank Ltd.
          Car Loans                                                                       148,198.00         358,610.00
          (Secured against hypothecation of Cars)[Amount due within one year is Rs.
          148198/- (197,640/-)]
                                                                                      332,259,252.04     185,512,656.73
5. UNSECURED LOANS
   Unsecured Loan                                                                        1,886,291.13        201,309.00
                                                                                         1,886,291.13        201,309.00

                                                                                              Annual Report 2008-09 105
106
                                                                                                                                                                                                                               Rupees
                                 6.   FIXED ASSETS

                                                                                               Gross Block                                                       Depreciation                                    Net Block

                                      Assets                              Cost as at        Additions   Deduction            Cost as at           As at   For the year           On             As at            As at              As at
                                                                         31st March           during          during        31st March      31st March                    Deductions       31st March       31st March        31st March
                                                                              2008           the year        the year            2009            2008                                           2009             2009               2008
                                      Leasehold Land at MIDC          13,334,350.00                 -               -   13,334,350.00     1,025,720.00      205,144.00             -    1,230,864.00     12,103,486.00   12,308,630.00

                                      Buildings                       26,137,646.22       394,381.00                -   26,532,027.22     1,062,232.32      429,933.69             -     1,492,166.01    25,039,861.21    25,075,413.90

                                      Leasehold Land at Pune          28,360,904.00                 -               -   28,360,904.00       286,473.77      286,473.76             -      572,947.53     27,787,956.47   28,074,430.23




Omnitech InfoSolutions Limited
                                      Office Equipments                2,689,104.34     1,088,403.82                -     3,777,508.16     1,135,086.76     140,089.72             -     1,275,176.48     2,502,331.68       1,554,017.58

                                      Software & Software Products     3,605,950.57                 -               -    3,605,950.57     1,442,380.24       721,190.12            -     2,163,570.36     1,442,380.21       2,163,570.33

                                      Computer Systems               379,820,499.89 359,567,648.32                  -   739,388,148.21 106,329,499.90     72,375,376.61            -   178,704,876.51   560,683,271.70   273,490,999.99

                                      Furniture & Fixtures            55,602,167.32     1,583,045.89                -    57,185,213.21    5,493,903.08    3,598,762.95             -    9,092,666.03     48,092,547.18   50,108,264.24

                                      Vehicles                         2,850,807.00                 -               -    2,850,807.00     1,420,624.28      227,512.37             -     1,648,136.65     1,202,670.35       1,430,182.72

                                      Business Acquisition             4,550,000.00                 -               -    4,550,000.00     3,033,332.00     1,516,668.00            -    4,550,000.00                 -       1,516,668.00

                                      Total                          516,951,429.34 362,633,479.03                  - 879,584,908.37 121,229,252.35       79,501,151.44            - 200,730,403.57 678,854,504.80       395,722,176.99

                                      Previous Year                  283,263,900.85    241,542,270.29 7,854,741.80      516,951,429.34    88,018,149.76 37,223,087.58 4,011,984.99 121,229,252.35                    -                  -
                                                                                                                                                                                                                                            SCHEDULES forming part of Balance Sheet as at March 31, 2009 (Contd.)
SCHEDULES forming part of Balance Sheet as at 31st March 2009 (Contd.)

                                                                                                                    Rupees
                                                                                                   As at              As at
                                                                                         31st March 2009   31st March 2008

7.   INVESTMENTS
     Short Term Investments (Trade - Quoted)
     Birla Sunlife Income Plus Growth Fund [51,097.18 units of Rs. 39.1411/- each,         2,000,000.00                   -
     Market Value as on 31.03.09 is Rs. 2,023,928.641/- Previous Year (Rs. Nil)]
     Birla Sunlife Income Plus Quarterly Dividend [637,187.96 units of Rs. 11.7199/-        7,126,246.30                  -
     each, Market Value as on 31.03.09 is Rs. 7,126,246.3/- Previous Year (Rs. Nil)]
     DSP Blackrock Bond Fund - Growth Fund [335,739.46 units of Rs. 29.785/-                9,749,907.78                  -
     each, Market Value as on 31.03.09 is Rs. 9,749,907.78/- Previous Year (Rs. Nil)]
     DSP Blackrock Floating Rate Fund [304,431.245 units of Rs. 14.1247/- each,            4,300,000.00                   -
     Market Value as on 31.03.09 is Rs. 4,307,001.925/- Previous Year (Rs. Nil)]
     ICICI Prudential Institutional Income Plan - Quarterly Dividend [870,537.45          46,546,262.78                   -
     units of Rs. 11.9171/- each and 3,194, 425.267 units of Rs. 12.487/- each, Market
     Value as on 31.03.09 is Rs. 46,546,262.78/- Previous Year (Rs. Nil)]
     Reliance Income Fund Quarterly Dividend [2,113,583.73 units of Rs. 14.1983/-          27,459,891.18                  -
     each, Market Value as on 31.03.09 is Rs. 27,459,891.18/- Previous Year (Rs. Nil)]
     Reliance Income Fund Monthly Dividend [1,425,497.41 units of Rs. 11.4871/-            14,558,319.93                  -
     each, Market Value as on 31.03.09 is Rs. 14,558,319.93/- Previous Year (Rs. Nil)]
     UTI Bond Fund Growth [890,561.66 units of Rs. 28.12/- each, Market Value as          22,373,847.75                   -
     on 31.03.09 is Rs. 22,373,847.75/- Previous Year (Rs. Nil)]
     Birla Interval Income Fund Series-1 Monthly Plan (6,100,000 units of                              -      61,000,000.00
     Rs. 10/- each, Market Value as on 31.03.08 is Rs. 61,087,230/-)
     Birla Sunlife Interval Fund-Quarterly Series II (3,563,248.964 units of                           -      35,632,618.54
     Rs. 10/- each, Market Value as on 31.03.08 is Rs. 35,703,754/-)
     Birla Sunlife Liquid Plus Daily Dividend (4,418,377.216 units of Rs. 10.006/-                     -      44,213,817.07
     each, Market Value as on 31.03.08 is Rs. 44,213,817/-)
     Reliance Monthly Internal Fund Series I Institutional Dividend Plan                               -     52,000,000.00
     (5,195,635.666 units of Rs. 10.0084/- each, Market Value as on 31.03.08
     is Rs. 52,030,654/-)
     [Aggregate amount of Quoted Investments Aggregate Market Value                       134,114,475.72     192,846,435.61
     Rs.134,145,406.29/- (Previous Year Rs. 193,035,455)]
     Long Term Investment
     (Other than traded - Unquoted)
     12,709 Shares of Bombay Mercantile Co-op Bank Ltd of Rs. 30/- each fully paid up        381,270.00          381,270.00
     98 shares of BD 50/- each of DRC Gulf WLL allotted and balance shares                             -      24,863,738.64
     of BD 50/- each to be allotted
     Investment in Subsidiary                                                               2,994,547.54       2,994,547.54
     [Aggregate amount of unquoted investments Rs. 33,75,817.54/- (Previous                 3,375,817.54      28,239,556.18
     Year Rs. 28,239,556.18/-)]
                                                                                         137,490,293.26      221,085,991.79




                                                                                                  Annual Report 2008-09 107
SCHEDULES forming part of Balance Sheet as at 31st March 2009 (Contd.)

                                                                                                                   Rupees
                                                                                                   As at              As at
                                                                                         31st March 2009   31st March 2008

8.    SUNDRY DEBTORS (UNSECURED, CONSIDERED GOOD)
      Debts outstanding for a period exceeding six months                                 336,751,597.76     52,833,916.65
      Other Debtors                                                                       251,954,456.21    302,234,959.00
                                                                                         588,706,053.97     355,068,875.65
 9.   CASH AND BANK BALANCES
      Cash-in-hand                                                                          1,753,316.65      2,046,987.08
      Balances with Scheduled Banks
      On Current Accounts                                                                  14,017,249.00     38,595,199.39
      On Deposit Accounts                                                                  13,329,946.00      8,854,443.00
      On Margin Money Accounts                                                                36,694.00          36,694.00
                                                                                           29,137,205.65     49,533,323.47
10. INVENTORIES
      Finished Goods                                                                     140,005,558.25      59,322,009.44
      (Inventory valued at cost or market value whichever is lower and as certified by
      the management)

                                                                                         140,005,558.25      59,322,009.44
11. LOANS AND ADVANCES
      (Unsecured, Considered Good)
      Advances recoverable in cash or in kind or for value to be received                 158,120,233.18     38,706,250.11
      Deposits                                                                              8,325,041.45       8,410,961.45
                                                                                          166,445,274.63      47,117,211.56
12. CURRENT LIABILITIES
      Sundry Creditors                                                                     23,643,769.97     54,731,842.68
      Unpaid Dividend                                                                         731,441.20                  -
      Duties & Taxes                                                                       21,612,668.03      12,941,715.89
      Deposits Received                                                                    7,096,243.00        1,965,141.00
                                                                                          53,084,122.20      69,638,699.57
13. PROVISIONS
      Provision For Expenses                                                               14,391,266.91      16,833,819.81
      Provision For Gratuity                                                                 850,893.00       2,956,193.00
      Provision For Leave Encashment                                                        1,378,139.00      2,673,285.00
      Provision For Income Tax                                                            92,999,760.00       3,179,339.20
      Provision For FBT                                                                    4,955,000.00       1,160,032.00
      Provision For Proposed Dividend                                                      15,767,140.00      15,767,140.80
      Provision For Dividend Tax                                                            2,679,625.44      2,679,625.58
                                                                                         133,021,824.35      45,249,435.39



108   Omnitech InfoSolutions Limited
SCHEDULES forming part of the Profit & Loss Account For The Year
Ended 31st March 2009

                                                                                    Rupees
                                                              Year ended        Year ended
                                                          March 31, 2009    March 31, 2008

14. OTHER INCOME
   Interest Income                                          3,379,805.20         795,919.00
   Miscellaneous Receipts                                   2,149,103.81         555,504.10
   Dividend from Mutual Funds on short term investments    16,323,562.94       9,454,398.66
                                                           21,852,471.95      10,805,821.76
15. OPERATIONAL EXPENSES
   Cost of Sales                                          954,266,815.51     770,223,749.57
   Consumable Spares Parts and Stores                       1,888,593.70       1,880,467.14
   Transportation                                             43,787.80          153,431.68
   Technical Repairs and Service Charges                   22,076,449.84       11,086,309.17
                                                          978,275,646.85     783,343,957.56
16. STAFF COST
   Salaries & Bonus                                       89,045,060.06       79,593,567.99
   PF & ESIC Contribution                                   2,763,288.00       3,068,319.00
   Remuneration to Whole Time Directors                     8,686,320.73       8,852,241.00
   Sitting Fees to Non-Executive Directors                   135,000.00          145,000.00
                                                          100,629,668.79       91,659,127.99
17. ADMINISTRATIVE AND OTHER EXPENSES
   Conveyance                                                 906,867.01        840,053.45
   Rent, Rates and Taxes                                   11,249,402.62       5,439,014.00
   Communication Cost                                       6,283,448.86       4,263,880.57
   Legal and Professional Charges                          50,142,574.68      32,730,285.46
   Postage & Courier                                         426,059.24          275,314.16
   Printing & Stationery                                    1,576,776.16       1,231,756.52
   Diwali and Pooja Expenses                                 378,925.00           12,795.00
   Office Maintenance                                       1,236,531.03          427,121.81
   Electricity Charges                                      3,293,751.00       2,286,337.00
   Insurance                                                 243,786.75          550,107.00
   Vehicle Maintenance Expenses                               825,119.46       1,514,083.08
   Books & Periodicals                                         14,341.25          10,754.00
   Filing Fees                                                42,070.00         285,624.00
   License Renewal Fees                                       30,500.00           24,130.00
   Fuel Charges                                               378,167.49                   -
   Provision for Impairment of Assets                         609,764.18                   -
   Provision for Diminuation in Value of Assets             9,984,703.21                   -
   Membership & Subscription                                  357,111.00         277,042.00
   Office Expenses                                          3,654,759.61       3,708,055.42




                                                                  Annual Report 2008-09 109
SCHEDULES forming part of the Profit & Loss Account For The Year
Ended 31st March 2009 (Contd.)

                                                                         Rupees
                                                    Year ended       Year ended
                                                 March 31, 2009   March 31, 2008

17. ADMINISTRATIVE AND OTHER EXPENSES (CONTD.)
      Packing Expenses                                5,555.56          2,650.00
      Recruitment Expenses                         1,299,162.96      2,017,315.10
      Registration Expenses                          45,857.00        90,000.00
      Claim against performance guarantee         1,022,045.00      5,352,158.97
      Stock Exchange Expenses                        75,317.00      1,264,146.00
      Miscellaneous Expenses                       1,016,581.38      493,836.08
                                                  95,099,177.46    63,096,459.62
18. SELLING AND DISTRIBUTION EXPENSES
      Transportation Outward                       2,084,169.48     2,486,970.70
      Travelling Expenses                         6,756,673.68      5,323,917.01
      Advertisement Expenses                        650,770.00        199,400.00
      Acquisition Expenses                         3,953,511.00                 -
      Bad Debts                                    7,571,444.37    13,945,473.97
      Discount                                     3,523,217.84      2,761,137.45
      Business Promotion Expenses                 2,459,038.69       2,418,918.27
      Commission on Sales                           306,018.00        876,903.00
      Rentals Computers                           1,000,206.00        771,558.82
      Tender Expenses                                 8,000.00          1,598.00
      Value Added Tax Paid/Sales Tax               1,743,339.51            10.00
      Exhibition & Conference Expenses              660,694.80        750,481.00
                                                 30,717,083.37     29,536,368.22
19. FINANCIAL EXPENSES
      Interest Paid
      On Term Loan                                2,996,956.00      3,860,566.00
      On Cash Credit & Demand Loan               15,897,005.65     10,700,628.97
      On Other Loans                              8,462,109.03      4,835,541.19
      Processing Charges & Other finance Cost     3,018,363.63       586,027.00
      Bank Charges                                4,274,559.44      2,476,881.04
      L C Charges                                 3,264,349.63      2,134,499.75
                                                 37,913,343.38     24,594,143.95




110   Omnitech InfoSolutions Limited
SCHEDULE To The Consolidated
Profit & Loss Accounts & Balance Sheet

20. SIGNIFICANT ACCOUNTING POLICIES AND NOTES ON ACCOUNTS
    A.   Significant Accounting Policies
         1.   Basis of preparation of Financial Statements
              i.     The Consolidated Financial Statements have been prepared in accordance with Accounting Standard
                     21 (AS-21) – “Consolidated Financial Statements” issued by The Institute of Chartered Accountants of
                     India (ICAI). These financial statements comprise Omnitech Infosolutions Limited (The Company) and it’s
                     wholly owned subsidiary Omnitech Technologies Inc. and subsidiary Omnitech TSB Co. Ltd. The financial
                     statements of each of these companies are prepared using uniform accounting policies in accordance with
                     the generally accepted accounting principles in India.
              ii.    The consolidated financial statements have been prepared and presented under historical cost convention
                     on the accrual basis of accounting in accordance with the accounting principles generally accepted in India
                     (GAAP) and in compliance with the Accounting Standards issued by The Institute of Chartered Accountants
                     of India and the provisions of the Companies act, 1956 as adopted consistently by the Company.
              iii.   Minority Interest’s share of net profit of consolidated subsidiaries for the year is identified and adjusted
                     against the income of the group in order to arrive at the net income attributable to shareholders of the
                     Company.
              iv.    Minority Interest’s share of net assets of consolidated subsidiaries is identified and presented in the
                     consolidated balance sheet separate from liabilities and the equity of the companies shareholders
              v.     Accounting policies not specifically referred to otherwise are consistent with the generally accepted
                     accounting principles followed by the Company.
              vi.    The preparation of consolidated financial statements in conformity with the generally accepted accounting
                     principles requires estimates and assumptions to be made, that affect the reported amounts of assets and
                     liabilities on the date of financial statements and the reported amounts of revenues and expenses during
                     the reported year. Differences between the actual results and estimates are recognized in the year in which
                     the results are known / materialized.
         2.   Revenue Recognition
              i.     Revenue from sales in respect of hardware is recognized when they are completed with passing of the title
                     and are exclusive of sales tax, octroi and other incidental expenses.
              ii.    Revenue from software development is recognized in accordance with the percentage of completion
                     method and revenue from sale of licenses of software products and other products is recognized on
                     delivery/installation, as the case may be.
              iii.   Revenue from IT infrastructure networking, annual service contracts and facilities management services is
                     deferred and recognized ratably over the period of the underlying maintenance agreement.
              iv.    Interest Income is recognized on a time proportion basis taking into account the amount outstanding and
                     the rate applicable.
              v.     Dividend Income is recognized when the shareholders’ right to receive payment is established by the
                     Balance Sheet Date.
         3.   Expenditure
              Expenses are accounted on accrual basis and the provisions are made for all known losses and liabilities. No
              provisions are made towards likely expenses on providing post-sales client support for fixed priced contracts as
              well as in respect of annual technical service contracts in so far as it pertains to the period beyond the current
              accounting year.



                                                                                                        Annual Report 2008-09       111
SCHEDULE To The Consolidated
Profit & Loss Accounts & Balance Sheet (Contd.)

20. SIGNIFICANT ACCOUNTING POLICIES AND NOTES ON ACCOUNTS (CONTD.)
      4.   Fixed Assets and Depreciation
           i.      Fixed Assets
                   a.   Fixed assets are stated at their original cost of acquisition including incidental expenses related to acquisition
                        & installation of the concerned assets less accumulated depreciation and impairment losses, if any.
                   b.   Costs that are directly associated with identifiable and unique software products controlled by the Company,
                        whether developed in-house or acquired, and have probable economic benefits exceeding the cost are
                        recognized as product development.
                   c.   Assets acquired under lease are at cost of acquisition including incidental expenses related to acquisition &
                        installation of such assets.
                   d.   Advances paid towards acquisition of fixed assets and the cost of assets not ready for use as at the Balance
                        Sheet date are disclosed under capital work-in-progress.
           ii.     Depreciation/Amortization.
                   a.   Depreciation on Software is provided based on Management’s estimate of useful life of Software however
                        subject to maximum period of 5 years. Depreciation on Fixed Assets other than Land and those mentioned
                        above has been provided on Straight Line Method at the following rates:

                        Asset Group                                                                                      Rates (SLM)
                        Computer Systems                                                                                        16.21%
                        Furniture & Fixtures                                                                                    6.33%
                        Vehicles                                                                                                9.50%
                        Office Equipments                                                                                        4.75%
                        Office Premises                                                                                          1.63%

                   b.   Product Development Expenses capitalized are amortized over its useful life for a period not exceeding ten
                        years.
                   c.   Leasehold assets are amortized over the period of lease.
                   d.   Miscellaneous expenditure is amortized over a period of 5 years from the year in which it has been incurred.
      5.   Impairment of Assets
           Fixed assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying
           amount of an asset may not be recoverable. Whenever the carrying amount of an asset exceeds its recoverable amount,
           an impairment loss is recognized in the income statement for items of fixed assets carried at cost. The recoverable
           amount is higher of an assets net selling price and value in use. The net selling price is the amount obtained from the
           sale of an asset in an arm’s length transaction while value in use is the present value of estimated future cash flows
           expected to arise from the continuing use of an asset, from its disposal at the end of its useful life.

      6.    Inventories
            Inventories have been valued on the following basis:
            i.     Raw Materials, packing material, stores and spares       -   At cost
            ii.    Work-in-progress                                         -   At cost plus appropriate allocation of overheads
            iii.   Finished Goods                                           -   At cost plus appropriate allocation of overheads or
                                                                                net realizable value, whichever is lower




112    Omnitech InfoSolutions Limited
SCHEDULE To The Consolidated
Profit & Loss Accounts & Balance Sheet (Contd.)

20. SIGNIFICANT ACCOUNTING POLICIES AND NOTES ON ACCOUNTS (CONTD.)
    7.   Investments
         Investments are classified into current investment and long term investments. Current investments are stated at
         lower of cost or fair market value. Long Term Investments are stated at cost less provision for permanent diminution
         in value if any, of investments.
    8.   Foreign Exchange Transactions
         Transactions denominated in foreign currencies are normally recorded at the exchange rate prevailing at the time of
         the transaction. Realized gains and losses on settlement of foreign currency transactions are recognized in the Profit
         and Loss account. Foreign currency assets and liabilities at the year end are translated at the year end exchange rates
         and the resultant exchange difference is recognized in the Profit and Loss Account. Exchange differences relating to
         fixed assets are adjusted in the cost of the respective assets.
    9.   Research & Development
         i.    Revenue expenditure on R&D is charged of to profit & loss account in the year in which it is incurred where the
               Company is not certain of realizing future economic benefits from such activities.
         ii.   Capital expenditure on R&D is included under the relevant fixed assets.
    10. Borrowing Costs
         Borrowing costs directly attributable to acquisition, construction and production of qualifying assets are capitalized as
         a part of the cost of such asset up to the date of completion. Other borrowing costs are charged to the Profit & Loss
         Account.
    11. Deferred Tax
         Deferred Income taxes reflects the impact of current year timing differences between taxable income and accounting
         income for the year and reversal of timing differences of earlier years. The differences that result between the profit
         considered for income taxes and the profit as per the financial statements are identified and thereafter a deferred tax
         asset or deferred tax liability is recorded for timing differences, namely the differences that originate in one accounting
         period and reverse in another, based on the tax effect of the aggregate amount being considered. The tax effect is
         calculated on the accumulated timing differences at the end of an accounting period based on prevailing enacted or
         substantially enacted regulations. Deferred tax assets are recognized only if there is reasonable certainty of their
         realization and are reviewed for the appropriateness of their respective carrying values at each Balance Sheet date.
   12.   Tax Expense
         Tax Expense includes Indian and International Income Taxes. Fringe Benefit Tax is provided in accordance with the
         provisions of the Income Tax Act, 1961.
   13.   Earnings per Share (EPS)
         The earnings considered in ascertaining the Company’s EPS are computed as per Accounting Standard 20 on
         “Earning per Share”, issued by the Institute of Chartered Accountants of India. The number of shares used in
         computing basic EPS is the weighted average number of shares outstanding during the period. The diluted EPS is
         calculated on the same basis as basic EPS, after adjusting for the effects of potential dilutive equity shares unless the
         effect of the potential dilutive equity shares is anti-dilutive.




                                                                                                      Annual Report 2008-09 113
SCHEDULE To The Consolidated
Profit & Loss Accounts & Balance Sheet (Contd.)
20. SIGNIFICANT ACCOUNTING POLICIES AND NOTES ON ACCOUNTS (CONTD.)
      14.  Provision and Contingent Liabilities
          Provisions are recognized and computed in accordance with Accounting Standard 29 on “Provisions, Contingent
          Liabilities and Contingent Assets” issued by the Institute of Chartered Accountants of India i.e. they are recognized if
          the following conditions are satisfied:
          i.    The Company has a present obligation as a result of past event;
          ii.   It is probable that an outflow of resources embodying economic benefits will be required to settle the obligation; and
          iii. A reliable estimate can be made of the amount of the obligation.
          Similarly, the Contingent liabilities are disclosed in Accordance with the Accounting Standard 29 i.e. they are disclosed
          when the Company has a possible obligation or a present obligation and it is probable that a Cash Outflow will not be
          required to settle the obligation.
      15. Leases
          Lease arrangements where the risks and rewards incident to ownership of an asset substantially vest with the lessor,
          are recognised as operating leases. Lease rentals under operating leases are recognised in the profit and loss account
          on a straight-line basis over the period of lease.
B.    Notes To The Accounts
      1. The subsidiary companies considered in consolidated financial statements are :

             i.    Omnitech Technologies Inc.                                               USA                                   100 %
             ii.   Omnitech TSB Co. Ltd                                                    Japan                             66.67 %

      2.     Earnings Per Share
                                                                                                      F.Y.                F.Y.
                                            PARTICULARS                                        31st March 2009       31st March 2008

            Face Value Per Share (Rs.)                                                                10                   10
            i.     Weighted average number of Equity shares
                   a.   Number of Equity Shares at the Beginning of the year                       13,139,283           9,405,950
                   b.   Number of Equity Shares at the End of the year                             13,139,283          13,139,283
                   c.   Weighted average number of Equity Shares                                   13,139,283         11,875,394.23
                        Outstanding During the year (On annualized basis)
            ii.    Net Profit after tax available for Equity Shareholders (Rs. In Lakhs)           3,299.39             2,548.22
            iii.   Basic and diluted earnings per share (in Rs.) (annualized)                        25.11                21.46

      3.    Segmental Reporting
            The Company is mainly engaged in the business of Information Technology and Information Technology enabled
            services. Considering the nature of business and financial reporting of the Company, the Company has only one
            segment viz. Information Technology.
            The Company operates in Local and Export geographically. But due to nature of business, the assets/liabilities and
            expenses thereof cannot be bifurcated separately.

For M/s. Kothari & Kenia                                              For and on Behalf of Board of Directors
Chartered Accountants
                                                                      Sd/-                                    Sd/-
(Nailesh R. Kothari)                                                  (Atul Hemani)                           (Avinash Pitale)
Partner                                                               Managing Director                       Executive Director
M. No. 42367
                                                                      Sd/-
                                                                      (Gaurav Sharma)
Place : Mumbai                                                        Company Secretary &
Date : 25th May 2009                                                  Chief Officer (Compliance & Legal)


114    Omnitech InfoSolutions Limited
NOTES




        Annual Report 2008-09 115
CORPORATE INFORMATION
Mr. Maganlal K. Hemani                    Non Executive Chairman

Mr. Atul M. Hemani                        Managing Director

Mr. Avinash C. Pitale                     Executive Director

Mr. Devarshi D. Buch                      Executive Director

Dr. Kalimohan J. Bhattacharya             Non Executive and Independent Director

Dr. Ram K. Mangal                         Non Executive and Independent Director

Prof. Venkateshwaran H. Iyer              Non Executive and Independent Director

Mr. Vasudeva V. Kamath                    Non Executive and Independent Director



Company Secretary & Chief Officer (Compliance & Legal)
Mr. Gaurav Sharma



Statutory Auditors
M/S. Kothari & Kenia



Registered/Corporate Office
Omnitech InfoSolutions Limited
Omnitech House
A/13 Cross Road No. 5,
Kondivita Road, Marol
M.J.D.C., Andheri (E),
Mumbai – 400093
Ph.: 022 – 40956666
Fax: 022 – 40956565



Registrar and Transfer Agent
Link Intime India Private Limited
C-13, Pannalal Silk Mills Compound
LBS Road, Bhandup (W),
Mumbai – 400078
Ph.: 022 – 25963838
Fax: 022 - 25962691




116   Omnitech InfoSolutions Limited
Printed at Thomson Press India Ltd.
www.omnitechindia.com

								
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