During 2010-11, our company recorded and increase revenues and 13 percent increase in EBIDTA and decline of 4.69% in profit after tax.

After reporting five years of straight growth, it would be important to emphasise that we see this aberration in PAT numbers as only a temporary interruption arising mainly out of a decline in other income.

Our growth journey is however on track and we expect to do better over the next two years when a couple of our important projects are progressively commissioned.

The decline in profit after tax notwithstanding, the Company's progress during the year under review was creditable for an important reason: The Company booked total business of Rs. 1,000 crore for the first time in any year in our history, despite a slow order-inflow witnessed in the first half of 2010-11 across the industry. Though we did not suffer extensive attrition, there was a decline in the strike rate for new projects (from 10 percent to 5 percent) due to inexperienced industry-wide bidding. However, the trend is changing and a large number of customers are showing a preference to shift to performing agencies.

Besides, there was a need to reinvest in new business assets, which required us to disinvest our financial assets and redeploy them. The result was a decline in our non-core income during the year under review, which will be progressively replaced with income from our core activities.

Responding positively

Techno responded positively to these developments, reaching deep within its competencies to keep competition at bay and protecting its margins in the process. These are some of the initiatives that the Company embarked upon:

•    We extended our presence in complex assignments marked by attractive fees and relatively low competition. For instance,we
      extended to an assignment to provide engineering solutions for a 765 KV substation for the very first time in our existence;until
      then our Company had worked on a variety of projects only up to 400 KV projects. This tended to counter the decline in our strike
      rate for new projects with higher remuneration from challenging projects, an adequate de-risking in a competitive marketplace

•    We forayed into the PPP segment with a project for the Haryana government, marked by relatively healthy competition on the one
      hand and a need for sophisticated bidding, with the funding risk lying with the bidder. We are optimistic of growing our presence in
      this space,as the central and state governments are expected to follow this model intensively. We have the first mover's advantage
      and expect to retain our leadership in the space.

•    We planned to become bigger in the green energy space for some good reasons - the sector holds out sustainable growth
      prospects,the segment makes us relatively independent of EPC contracts and provides us with a safety net to bid for fewer
      projects with higher returns.

Building the business

Techno strengthened its ongoing business through timely investments, the implications of which will be fully felt from 2012-13 onwards. The Company was awarded a project by the Haryana government to build, operate and maintain its transmission maintenance lines for a concession period of 25 years in exchange for sustainable annual revenues and the probable encashment (in full or part) of any increase in business value. At this point, the project is running a couple of months ahead of schedule with every possibility of its being commissioned in calendar year 2011. Since a number of Indian states are also proposing a similar model or outsourcing commissioning and maintenance, we stand to be favorably considered on account of our technical and financial capability on the one hand and our successful Haryana experience on the other. Besides, our experience in the sector and comfort in managing the project scale will serve as a competitive hedge against emerging competition.

The Company continued to scale its exposure in commissioning renewable energy projects. Until the close of the financial year under review, we had commissioned 15 MW of wind energy capacity in addition to having earlier acquired 95.45 MW. The entire capacity of 101.4 MW is scheduled to be commissioned by August end. This business is attractive for the following reasons: Lower dependence on manpower, complete independence from fossil fuels or mines, use of hardware from credible vendors, predictable income flow and assured terms through credible power purchase agreements. Going ahead, our strategy is to acquire a critical mass in green energy generation, generate attractive annual cash surpluses and deploy them back into asset building, creating a virtuous self-feeding cycle. In doing so, we expect to emerge as one of the largest green energy companies in India Meanwhile, we expect to grow our competitive EPC business through successful bidding and leveraging an established reputation.

Outlook

Techno is attractively positioned for 2011-12. The Renewable Energy Certificate (REC) incentive proposals by the government as well as a growing acceptance of the concept of independent renewable power producers will catalyze growth. We expect that this reorganization of our business will generate a significant part of our EPC assignments from within the Company, secure our revenues from marketplace volatility and provide us with attractive tax hedges that incentivize reinvestment. In view of these initiatives I see attractive growth for our Company, translating into enhanced value for all our stakeholders.