MIRA INFORM REPORT

Report Date :

08.02.2013

IDENTIFICATION DETAILS

Name :	GLODYNE TECHNOSERVE LIMITED (w.e.f. 24.11.2008)

Formerly Known As :	PARADYNE INFOTECH LIMITED

Registered Office :	801, Balarama, Bandra Kurla Complex, Bandra (East), Mumbai – 400 051, Maharashtra

Country :	India

Financials (as on) :	31.03.2012

Date of Incorporation :	05.12.1997

Com. Reg. No.:	11-112281

Capital Investment / Paid-up Capital :	Rs.269.959 millions

CIN No.: [Company Identification No.]	L51100MH1997PLC112281

Legal Form :	Public Limited Liability Company. The Company’s Shares are Listed on the Stock Exchanges.

Line of Business :	Subject is engaged in Technology Infrastructure Management Services and Application Software Services including providing turnkey solutions for large scale technology projects, technology maintenance and management.

No. of Employees :	Not Available

RATING & COMMENTS

MIRA’s Rating :

B (36)

RATING

STATUS

PROPOSED CREDIT LINE

26-40

Capability to overcome financial difficulties seems comparatively below average.

Small

Maximum Credit Limit :	USD 33164000

Status :	Moderate

Payment Behaviour :	Slow

Litigation :	Clear

Comments :	Subject is a well established company having moderate track record. There appear delays in timely servicing of commercial paper programme on account of liquidity constraints faced by the company. Trade relations are reported as fair. Business is active. Payment terms are slow. The company can be considered for business dealings with great caution. Note: Due to technical error in the government sites, we hereby provide you the report with available details and we would provide you with a on the same company as soon as we get the additional information.

NOTES :

Any query related to this report can be made on e-mail : infodept@mirainform.com while quoting report number, name and date.

ECGC Country Risk Classification List – June 30, 2012

Country Name

Previous Rating

(31.03.2012)

Current Rating

(30.06.2012)

India

Risk Category	ECGC Classification
Insignificant	A1
Low	A2
Moderate	B1
High	B2
Very High	C1
Restricted	C2
Off-credit	D

INDIAN ECONOMIC OVERVIEW

India is developing into an open-market economy, yet traces of its past autarkic policies remain. Economic liberalization, including industrial deregulation, privatization of state-owned enterprises, and reduced controls on foreign trade and investment, began in the early 1990s and has served to accelerate the country's growth, which has averaged more than 7% per year since 1997. India's diverse economy encompasses traditional village farming, modern agriculture, handicrafts, a wide range of modern industries, and a multitude of services. Slightly more than half of the work force is in agriculture, but services are the major source of economic growth, accounting for more than half of India's output, with only one-third of its labor force. India has capitalized on its large educated English-speaking population to become a major exporter of information technology services and software workers. In 2010, the Indian economy rebounded robustly from the global financial crisis - in large part because of strong domestic demand - and growth exceeded 8% year-on-year in real terms. However, India's economic growth in 2011 slowed because of persistently high inflation and interest rates and little progress on economic reforms. High international crude prices have exacerbated the government's fuel subsidy expenditures contributing to a higher fiscal deficit, and a worsening current account deficit. Little economic reform took place in 2011 largely due to corruption scandals that have slowed legislative work. India's medium-term growth outlook is positive due to a young population and corresponding low dependency ratio, healthy savings and investment rates, and increasing integration into the global economy. India has many long-term challenges that it has not yet fully addressed, including widespread poverty, inadequate physical and social infrastructure, limited non-agricultural employment opportunities, scarce access to quality basic and higher education, and accommodating rural-to-urban migration.

Source : CIA

EXTERNAL AGENCY RATING

Rating Agency Name	ICRA
Rating	D (Default) [Commercial Paper]
Date	August, 2012

Rating Agency Name	ICRA
Rating	BBB+ (Withdrawn) [Non Convertible Debenture]
Date	August, 2012

Note:

Reason for Withdrawing Rating: The Company has not raised funds against the rated instrument.

RBI DEFAULTERS’ LIST STATUS

Subject’s name is not enlisted as a defaulter in the publicly available RBI Defaulters’ list.

EPF (Employee Provident Fund) DEFAULTERS’ LIST STATUS

Subject’s name is not enlisted as a defaulter in the publicly available EPF (Employee Provident Fund) Defaulters’ list as of 31-03-2012.

LOCATIONS

Registered Office/ Branch Office :	801, Balarama, Bandra Kurla Complex, Bandra (East), Mumbai – 400 051, Maharashtra, India
Tel. No.:	Not Available
Fax No.:	Not Available
E-Mail :	amit.jaste@glodyne.com mumbai@glodyne.com
Website :	http://www.glodynetechnoserve.in

Corporate Office :	C-03, Ground Floor, Fortune 2000, Bandra Kurla Complex, Bandra (East), Mumbai – 400 051, Maharashtra, India
Tel. No.:	91-22-66963333
Fax No.:	91-22-66963344
E-Mail :	corporate@glodyne.com cs@glodyne.com

Support Center :	53-2476, Radheshyam, Gandhinagar, Bandra (East), Mumbai – 400 051, Maharashtra, India

Pune (Tech-Center 1) :	Kshitij, Plot No.38, Rajeev Gandhi Infortech Park, Hinjewadi, Pune – 411 057, Maharashtra, India

Mumbai (Tech-Center 2) :	A-3, Unit No.215, Sector 1, Millennium Business Park, Mahape, Navi Mumbai – 400 709, Maharashtra, India
Tel No.:	91-22-27781018
Fax No.:	91-22-27781019
Email :	support@glodyne.com

Branch Office :	Located at: v Pune v Bangalore v Patna v Hyderabad v Lucknow v Noida v Kolkata v Gadchiroli v Ahmedabad v Chandigarh

Overseas Office 1 :	West Coast 2700 Augustine Drive Ste 190, Santa Clara CA 95054
Tel. No.:	(408) 340-5017
Fax No.:	(408) 988-3965

Overseas Office 2 :	North America 426 West Lancaster Avenue, Devon, Pennsylvania 19333
Tel. No.:	(800) 767-2876 Sales Inquiries: (888) 287-9202
Fax No.:	(610) 296-2910

DIRECTORS

As on 31.03.2012

Name :	Mr. Annand Sarnaaik
Designation :	Chairman and Managing Director
Address :	C-54, Panorama Park, Ashokvan, Shiv Vallabh Road, Borivali (East), Mumbai – 400 068, Maharashtra, India

Name :	Mr. Alok Sharma
Designation :	Independent Director

Name :	Mr. Bryan Sanderson
Designation :	Independent Director

Name :	Mrs. Divvyani A. Sarnaaik
Designation :	Executive Director
Address :	C-54, Panorama Park, Ashokvan, Shiv Vallabh Road, Borivali (East), Mumbai – 400 068, Maharashtra, India

Name :	Dr. Mohan Kaul
Designation :	Independent Director

Name :	Mr. R.S.P. Sinha
Designation :	Independent Director

Name :	Mr. Samar Ray
Designation :	Independent Director

Name :	Mr. Shantanu Rooj
Designation :	Whole-time Director

KEY EXECUTIVES

Name :	Mr. Amit Jaste
Designation :	Company Secretary

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

As on 31.12.2012

Category of Shareholders	No. of Shares	Percentage of Holding
(A) Shareholding of Promoter and Promoter Group
(1) Indian
Individuals / Hindu Undivided Family	14796425	32.77
Bodies Corporate	1340000	2.97
Sub Total	16136425	35.74
(2) Foreign
Total shareholding of Promoter and Promoter Group (A)	16136425	35.74
(B) Public Shareholding
(1) Institutions
Financial Institutions / Banks	1205060	2.67
Venture Capital Funds	5966	0.01
Foreign Institutional Investors	2113538	4.68
Sub Total	3324564	7.36
(2) Non-Institutions
Bodies Corporate	10727542	23.76
Individuals
Individual shareholders holding nominal share capital up to Rs.0.100 million	8257612	18.29
Individual shareholders holding nominal share capital in excess of Rs.0.100 million	5820470	12.89
Any Others (Specify)	884481	1.96
Clearing Members	233173	0.52
Non Resident Indians	650225	1.44
Trusts	1083	0.00
Sub Total	25690105	56.90
Total Public shareholding (B)	29014669	64.26
Total (A)+(B)	45151094	100.00
(C) Shares held by Custodians and against which Depository Receipts have been issued	0	0
(1) Promoter and Promoter Group	0	0
(2) Public	0	0
Sub Total	0	0
Total (A)+(B)+(C)	45151094	0.00

BUSINESS DETAILS

Line of Business :	Subject is engaged in Technology Infrastructure Management Services and Application Software Services including providing turnkey solutions for large scale technology projects, technology maintenance and management.

Products/ Services :	Information Technology

GENERAL INFORMATION

No. of Employees :

Not Available

Bankers :

v Barclays Bank PLC

v Corporation Bank

v DBS Bank

v HDFC Bank Limited

v ICICI Bank Limited

v Ratnakar Bank Limited

v State Bank of India

v Standard Chartered Bank

Facilities :

Secured Loans	31.03.2012 (Rs. in Millions)	31.03.2011 (Rs. in Millions)
LONG-TERM BORROWINGS
a. Term Loan from Banks
(i) Rupee loans	871.101	119.372
Less: Current Maturities	371.791	50.345
Total (i)	499.310	69.027
(ii) Foreign Currency loans	1026.458	0.000
Less:- Current Maturities	61.280	0.000
Total (ii)	965.178	0.000
Total (a) (i+ii)	1464.488	69.027
b. Vehicle Loans from Banks	12.124	17.050
Less: Current Maturities	7.972	6.615
Total (b)	4.152	10.435
Total (a+b)	1468.640	79.462

SHORT-TERM BORROWINGS
Loans Repayable on Demand Cash Credit and Other Working Facilities from banks	1611.349	1326.144
Total	3079.989	1405.606

Unsecured Loans	31.03.2012 (Rs. in Millions)	31.03.2011 (Rs. in Millions)
SHORT-TERM BORROWINGS
Commercial Paper from Bank	250.000	0.000
Total	250.000	0.000

Notes:

LONG-TERM BORROWINGS

Additional Information to Secured Long Term Borrowings:

Long term Portion of Term Loans are reflected under Long term Borrowings and the Current Maturities of the Long term Borrowings are reflected under Current Liabilities.

Detail of Securities and Terms of Repayment

ICICI Bank:

Outstanding Loan as on 31^st March 2012 is Rs.470.000 millions Secured by pari-passu charge on all the present and future, fixed and 2^nd charge on current assets of the company.

The loan is guaranteed by the promoters of the company and the promoter Group Company. The loan is repayable in 18 monthly installments including moratorium period of first 3 months. Interest rate @ 13% (Base rate @ 10% plus spread @ 3%) is applicable on the said Loan. The period of maturity w.r.t. balance sheet date is 1 year and 4 months.

Ratnakar Bank Limited:

Outstanding Loan as on 31^st March 2012 is Rs.332.075 millions Secured by Subservient charge on all the present and future movable fixed assets and Current assets of the Company. Second pari passu charge by way of registered mortgage on the certain immovable property of Pune and personal guarantee of the promoters of the company. The loan is repayable in 36 months installments including moratorium period of first 12 months. Interest rate @ 13.5% p.a. (Base Rate @ 11% plus spread @2.50%) is applicable on the said Loan. The period of maturity w.r.t. balance sheet date is 2 years and 11 months

Corporation Bank:

Outstanding Loan as on 31^st March 2012 is Rs.69.027 millions Secured by exclusive charge on the machinery purchased. The loan is repayable in 19 monthly installments of Rs.4.545 millions. Interest rate @13.75% (Base Rate @ 10.65% plus spread @ 3.10) is applicable on the said Loan. The period of maturity w.r.t balance sheet date is 1 year and 2 months

DBS Bank:

Outstanding Loan as on 31^st March 2012 is Rs.1026.458 millions Secured by exclusive charge over movable fixed assets purchased out of loan funds and pari passu charge on all the movable Fixed assets of the Company. The loan is repayable 20 quarterly installments including moratorium period of first 5 quarters. Interest rate applicable is 3 month LIBOR plus spread of 240 basis points. The period of maturity w.r.t balance sheet date is 4 years and 2 quarters.

Vehicle Loans are secured against hypothecation of respective vehicles.

SHORT-TERM BORROWINGS

Cash Credit and other Working Capital facilities are secured by Pari Passu charge on current assets and movable fixed assets of the Company. The facility is also secured by way of personal guarantees of certain Directors and pledge of certain Shares of the Promoters. Aggregate limits sanctioned by banks Rs.1640.000 millions (Rs.1320.000 millions) as on the balance sheet date.


Banking Relations :	--

Auditors :
Name :	N.M. Kapadia and Company Chartered Accountants
Address :	Mumbai, Maharashtra, India

Subsidiaries :	v DecisionOne Corporation (Subsidiary of Glodyne Technoserve Inc.-U.S.A.), 426 West Lancaster Avenue, Devon, Pennsylavania 19333 v Smaarftech Technologies Private Limited, Plot 538, A.G. Palace, East Boring Canal Road, Patna – 800 001, Bihar, India v Glodyne Technoserve Inc., 2700 Augustine Drive Ste 190, Santa Clara CA 95054 v Glodyne Peoplepower Limited, India v Compulink USA Inc., USA v Compulink Europe Limited - U.K. v Compulink Software Pte Limited - Singapore v Glodyne Technoserve (East) Inc.-U.S.A. (Subsidiary of Glodyne Technoserve Inc.-U.S.A) v Front Office Technologies Inc.-U.S.A. (Subsidiary of Glodyne Technoserve Inc.-U.S.A.)

Enterprise over which certain KMP exercise significant influence :	v Growdyne Techzone Services Limited v Glodyne Global Private Limited

CAPITAL STRUCTURE

As on 31.03.2012

Authorised Capital :

No. of Shares	Type	Value	Amount
90000000	Equity Shares	Rs.6/- each	Rs.540.000 millions
8500000	Preference Shares	Rs.6/- each	Rs.51.000 millions
	Total		Rs.591.000 millions

Issued, Subscribed & Paid-up Capital :

No. of Shares	Type	Value	Amount
44993210	Equity Shares	Rs.6/- each	Rs.269.959 millions

Reconciliation of the shares outstanding at the beginning and at the end of the reporting period

Particulars	31^st March, 2012
	Number	Amount (Rs. in millions)
Equity Shares
Outstanding at the beginning of the year	43825280	262.952
Add: Issued during the year	1167930	7.008
Outstanding at the end of the year	44993210	269.960

Term/rights attached to shares

(i) The company has only one class of equity shares having a par value of Rs.6/- per share. Each holder of equity shares is entitled to one vote per share. The company declares and pays dividends in Indian rupees. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting.

In the event of liquidation of the Company, the holder of Equity Shares will be entitled to receive the remaining shares of the company, after distribution of all Preferential amounts. The distribution will be in proportion to the number of Equity Shares held by the Shareholders.

(ii) The authorised capital of the company also comprises 8500000 number of preference shares of Rs.6/- each. However the company has not issued the same for subscription.

Shares reserved for issue under options:

Shares held by holding/ultimate holding company and/or their subsidiaries / associates

Particulars

31^st Mach, 2012

No. of Shares

Nil

The company has stock option scheme for its employees and employees of its subsidiary companies. As on 31^st March, 2012 number of options were outstanding 2279293 shares. Each option gets converted into 1 equity share.

During the year, the Company has granted 680220 options. The Company follows intrinsic value method to account for Employee compensation costs in respect of grant of options. The employee compensation cost equals to the difference between the market price of the shares covered under the options as on the day before the date of grant and the exercise price. As a result, intrinsic value of these options for the current financial year amounted to Rs.2.119 millions and the same has been reflected under Expense on Employee Stock Option Scheme and credited to Stock option outstanding account.

Aggregate number of bonus shares issued, share issued for consideration other than cash and shares bought back during the period of 5 years immediately preceding the reporting date:

Particulars

31^st March, 2012

(Nos.)

Equity shares allotted as fully paid bonus shares by way of capitalization of general reserve , balance in Profit and loss account and securities premium account

24323910

Details of shareholders holding more than 5% shares in the

Name of the shareholders	31^st March, 2012
Name of the shareholders	Number	% holding in the shares
Equity shares of Rs.6/- each fully paid up
Annand Sarnaaik	15235210	33.86%
Divvyani A. Sarnaaik	9164543	20.37%

FINANCIAL DATA

[all figures are in Rupees Millions]

ABRIDGED BALANCE SHEET

SOURCES OF FUNDS		31.03.2012	31.03.2011	31.03.2010
SHAREHOLDERS FUNDS
1] Share Capital		269.959	262.952	225.133
2] Stock Options Outstanding Account		2.119	0.000	0.000
3] Share Application Money Pending Allotment		2.521	0.408	0.000
4] Share Suspense Account		0.000	0.000	27.796
5] Money received against share warrants		150.000	108.000	0.000
6] Reserves & Surplus		7866.279	4867.833	2368.552
7] Securities Premium Suspense Account		0.000	0.000	240.133
8] (Accumulated Losses)		0.000	0.000	0.000
NETWORTH		8290.878	5239.193	2861.614
LOAN FUNDS
1] Secured Loans		3079.989	1405.606	835.612
2] Unsecured Loans		250.000	0.000	5.680
TOTAL BORROWING		3329.989	1405.606	841.292
DEFERRED TAX LIABILITIES		70.552	162.038	111.224

TOTAL		11691.419	6806.837	3814.130

APPLICATION OF FUNDS
FIXED ASSETS [Net Block]		3007.782	1153.825	897.353
Capital work-in-progress		60.080	34.770	6.418
Intangible Asset under development		0.000	14.584	20.904
INVESTMENT		1871.229	1515.485	445.060
DEFERRED TAX ASSETS		0.000	0.000	0.000

CURRENT ASSETS, LOANS & ADVANCES
	Inventories	42.260	15.737	44.681
	Sundry Debtors	3011.712	1813.901	1562.541
	Cash & Bank Balances	295.159	350.173	391.533
	Other Current Assets	73.656	6.896	0.000
	Loans & Advances	6072.755	2718.823	979.939
Total Current Assets		9495.542	4905.530	2978.694
Less : CURRENT LIABILITIES & PROVISIONS
	Sundry Creditors	465.704	147.460	163.508
	Other Current Liabilities	893.094	156.928	46.095
	Provisions	1384.416	512.969	324.696
Total Current Liabilities		2743.214	817.357	534.299
Net Current Assets		6752.328	4088.173	2444.395
MISCELLANEOUS EXPENSES		0.000	0.000	0.000

TOTAL		11691.419	6806.837	3814.130

PROFIT & LOSS ACCOUNT

	PARTICULARS		31.03.2012	31.03.2011	31.03.2010
	SALES
		Revenue from Operations	15576.532	9820.745	7073.076
		Other Income	548.174	67.438	(71.946)
		TOTAL (A)	16124.706	9888.183	7001.130

Less	EXPENSES
		Employee Benefit Expense	1416.304	854.869	5462.420
		Other Expenses	10095.355	6590.534
		TOTAL (B)	11511.659	7445.403	5462.420

Less	PROFIT BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C)		4613.047	2442.780	1538.710

Less	FINANCIAL EXPENSES (D)		428.126	205.466	128.954

	PROFIT BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D) (E)		4184.921	2237.314	1409.756

Less/ Add	DEPRECIATION/ AMORTISATION (F)		407.942	234.884	164.220

	PROFIT BEFORE TAX (E-F) (G)		3776.979	2002.430	1245.536

Less	TAX (H)		1206.495	560.815	277.296

	PROFIT AFTER TAX (G-H) (I)		2570.484	1441.615	968.240

Add	PREVIOUS YEARS’ BALANCE BROUGHT FORWARD		2868.303	1785.374	1140.475

Less/ Add	APPROPRIATIONS
		Transfer to General Reserve	--	144.162	191.719
		Proposed Dividend @ 0.15 per share	6.762	184.580	110.370
		Provision for Tax on Dividend	1.097	29.944	18.331
		Additions on account of Amalgamation	--	--	4.752
		Transfer from Debenture Redemption Reserve	--	--	4.200
		Utillised for issue of Bonus Shares	--	--	11.873
	BALANCE CARRIED TO THE B/S		5430.928	2868.303	1785.374

	EARNINGS IN FOREIGN CURRENCY
		Software Services	0.000	265.029	102.942
		Technology Infrastructure Management Services	237.776	1257.279	1017.099
	TOTAL EARNINGS		237.776	1522.308	1120.041

	Earnings Per Share (Rs.)
	- Basic		58.16	33.38	23.78
	- Diluted		53.11	30.28	22.72

QUARTERLY RESULTS

PARTICULARS	30.06.2012 (1^st Quarter)	30.09.2012 (2^nd Quarter)
Net Sales	4149.200	3437.400
Total Expenditure	3094.200	3410.600
PBIDT (Excl OI)	1055.100	26.800
Other Income	392.900	(191.000)
Operating Profit	1448.000	(164.200)
Interest	141.400	153.400
Exceptional Items	0.000	0.000
PBDT	1306.500	(317.600)
Depreciation	160.600	177.100
Profit Before Tax	1145.900	(494.700)
Tax	385.600	0.000
Provisions and contingencies	0.000	0.000
Profit After Tax	760.400	(494.700)
Extraordinary Items	0.000	0.000
Prior Period Expenses	0.000	0.000
Other Adjustments	0.000	0.000
Net Profit	760.400	(494.700)

KEY RATIOS

PARTICULARS		31.03.2012	31.03.2011	31.03.2010
PAT / Total Income	(%)	15.94	14.58	13.83

Net Profit Margin (PBT/Sales)	(%)	24.25	20.39	17.61

Return on Total Assets (PBT/Total Assets}	(%)	30.21	33.10	32.13

Return on Investment (ROI) (PBT/Networth)		0.46	0.38	0.44

Debt Equity Ratio (Total Debt/Networth)		0.40	0.27	0.29

Current Ratio (Current Asset/Current Liability)		3.46	6.00	5.57

LOCAL AGENCY FURTHER INFORMATION

Check List by Info Agents	Available in Report (Yes / No)
1) Year of Establishment	Yes
2) Locality of the firm	Yes
3) Constitutions of the firm	Yes
4) Premises details	No
5) Type of Business	Yes
6) Line of Business	Yes
7) Promoter’s background	No
8) No. of employees	No
9) Name of person contacted	No
10) Designation of contact person	No
11) Turnover of firm for last three years	Yes
12) Profitability for last three years	Yes
13) Reasons for variation <> 20%	--
14) Estimation for coming financial year	No
15) Capital in the business	Yes
16) Details of sister concerns	Yes
17) Major suppliers	No
18) Major customers	No
19) Payments terms	No
20) Export / Import details (if applicable)	No
21) Market information	--
22) Litigations that the firm / promoter involved in	--
23) Banking Details	Yes
24) Banking facility details	Yes
25) Conduct of the banking account	--
26) Buyer visit details	--
27) Financials, if provided	Yes
28) Incorporation details, if applicable	Yes
29) Last accounts filed at ROC	Yes
30) Major Shareholders, if available	Yes
31) Date of Birth of Proprietor/Partner/Director, if available	No
32) PAN of Proprietor/Partner/Director, if available	No
33) Voter ID No of Proprietor/Partner/Director, if available	No
34) External Agency Rating, if available	Yes

COMPANY OVERVIEW:

The Company is engaged in Technology Infrastructure Management Services and Application Software Services including providing turnkey solutions for large scale technology projects, technology maintenance and management in India and Overseas. The Company has head quarters at Mumbai, India.

REVIEW OF PERFORMANCE:

On a Standalone basis, the Company has recorded a total income of 16124.706 millions for the financial year ended March 31, 2012, an increase of 63.07% compared to last year’s figure of Rs.9888.183 millions. The Earnings before Interest, Tax, Depreciation and Adjustments (EBITDA) stood at Rs.4613.047 millions as compared to last years Rs.2442.780 millions, recording a growth of 88.84%. The Company’s profit after tax stood at Rs.2570.484 millions as compared to previous year’s Rs.1441.616 millions, recording a growth of 78.31%. Due to subdued performance of the US subsidiary in view of the non availability of the working capital at US and hence delayed integration, the Consolidated results were lower as compared to the standalone for the year.

FINANCE AND CAPITAL STRUCTURE:

Strategic Acquisitions / Mergers:

Domestic Acquisition:

The Company continued on its growth path through a healthy mix of organic and inorganic route. As a part of the Company’s strategy of growing and strengthening its leadership position in services business, the Company had announced the acquisition of Comat Technologies Private. Limited (‘Comat’), a leading provider of e-governance services in India, which is pending for closure due to completion of the customary closing conditions. As the acquisition is pending for closure the Consolidated Results do not include the financials of Comat. Comat subsequent to the closure of the acquisition, may act a subsidiary of the Company or may be merged with the Company in order to derive the necessary business and fiscal benefits, subject to necessary approvals.

Comat has been in the business of delivering essential Government and Private services to rural India. Comat has been a pioneer in e-governance services and ran a network of thousands of centers in rural areas for door step delivery of Government services. In addition to delivery of services, Comat has worked with Government in re-engineering processes and using technology to bring efficiency and cost savings to the Government. Most recently, Comat has been involved with piloting and subsequently scaling the UID initiative in several states.

The Comat acquisition together with their technology and service offerings, will help in creating value for all constituents, it will also facilitate the Company to expand its reach in new states and add several key partnerships and relationships with governments for providing citizen centric programs.

Warrants issued under the preferential guidelines:

As per the approval granted by the members of the Company at the 14^th Annual General Meeting, the Company during the year, on receipt of the requisite Stock Exchanges Approvals had issued 1500000 warrants, carrying the entitlement of conversion of 1 equity share of Rs.6/- each at Rs.400/- per warrant to Glodyne Global Private Limited, a promoter group Company. The warrants are due for conversion in April, 2013.

Increase in Share Capital:

(i) Allotment on exercise of stock options under Employee Stock Option Scheme:

During the year, 167930 equity shares of the face value of Rs.6/- each (post subdivision) has been issued on the exercise of Stock Options under the Employee Stock Option Scheme 2006 of the Company. As a result of the above, the Company’s paid up capital stood increased to Rs.263.959 millions consisting of 43993210 equity shares of Rs.6/- each.

(ii) Allotment on Conversion of warrants issued under the preferential guidelines:

On June 23, 2010, 600000 warrants were issued to Glodyne Global Private. Limited, a promoter group Company, as per members’ approval granted at 13th Annual General Meeting. The said warrants carried entitlement of conversion in to 1 equity share of Rs.10/- each. Post split, the allotted warrants were effected into 1000000 warrants, carrying the entitlement of conversion of 1 equity share of Rs.6/- each. The Promoter Warrant holder has exercised its right and converted the warrants into equity shares at a price of Rs.432 per share.

Accordingly, during the year, 1000000 equity shares were allotted to Glodyne Global, thereby increasing the paid up equity share capital from 43993210 to 44993210 shares of Rs.6/- each as on March 31, 2012.

AWARDS AND ACCOLADES:

During the year, the Company was awarded with the following Awards:

v ‘Best Under a Billion’ 2011 award for the year by Forbes Asia

v ‘Outstanding Entrepreneurship Award’ awarded to Mr. Annand Sarnaaik at the The Asia Pacific Entrepreneurship Awards 2011

v ‘E-Shakti’ project of Glodyne was adjudged as the winner at ‘EDGE’ awards at INTEROP 2011.

v ‘E-Shakti’ was declared as the best ‘ICT initiative in the Country’ at the PC Quest 2011 Awards

v Glodyne was chose as the best “Best Government to Citizen Initiative” Company at the ‘E-World Awards 2011’

v Glodyne’s Education Managed Services was announced as the winner at “World Education Award 2011”

v Glodyne received ‘Asia’s Best Employer Brand Award 2011’ under the categories of Best Employer Brand – Talent Management and in the Continuous Innovation at HR Strategy

v Ranked one of the top performing mid sized companies by Inc India

v Winner at the ‘Deloitte Technology Fast 500 AsiaPac Program’ 2011 and ‘Deloitte Technology Fast 50 India Program’ 2011

MANAGEMENT DISCUSSION AND ANALYSIS

Industry overview and Glodyne Businesses

In today’s world, change is truly a constant. This is probably true of all facets of human and business life. In the Glodyne world, they are reminded of this everyday, every hour. All of their markets and businesses are undergoing constant change- throwing new challenges, opening up new opportunities.

IT is a big enabler of change. This is true for businesses, government, and rapidly, even consumer markets. On one hand, innovation continues to drive the frontier and push boundaries of what is possible. On the other, even conservative customers like government, banking and education are beginning to integrate these new technology offerings and enhance the experience of their beneficiaries. At Glodyne, they recognize the business opportunity behind the changing environment which is really in helping their clients better serve their beneficiaries using IT strategically and cost effectively. Much of the direction of work at Glodyne is driven with these guiding principles. Building IT platform based solutions allows them to meet these seemingly diverse objective. The markets Glodyne addresses are particularly dynamic- E-governance, financial inclusion, education, Infrastructure managed services. Here is a synopsis of each of the businesses and an analysis of the market context under which they operate.

Financial Inclusion

Market Environment: The Reserve Bank of India (RBI) wants to include every Indian to the country’s banking and financial system. Reserve Bank of India’s vision for 2020 is to open nearly 600 million new customers’ accounts and service them through a variety of channels. The government provides full support to this program because lack of financial inclusion results in lost growth opportunities, inadequate utilization of resources, exclusion of people from mainstream society and loss of control on cash from government programs

RBI provided clear mandate to banks to expand their base to the financially excluded sections of the society and provided them explicit targets in year 2011-12. Banks and their Business Correspondents, in turn made aggressive efforts to provide banking touch-points at each of the 72721 uncovered villages with a population above 2000 by the end of this fiscal. These efforts under the “Swabhimaan Campaign” were to be extended to habitations with population of more than 1000 in north eastern and hilly states.

Glodyne View: In Glodyne’s view, the implementation challenges in achieving true state of financial inclusion are significant. The biggest challenge banks and service provides are facing has been high levels of inactivity in the accounts. Estimates suggest more than 81% of accounts opened with the intent of delivering wholesome financial services have not been active. The remaining 19% accounts have been active on account of government payments under the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS), Indira Awaas Yojana and other programmes. Glodyne’s focus has been on the latter 19% of the accounts. In a path breaking move, Glodyne is now working towards a much broader financial inclusion program by collaborating with the Maharashtra government and several banks to make wage payment through the banking channel as a part of the Mahashramm project. Dialog is underway several other states to achieve similar outcomes. Having dabbled in accomplishing financial inclusion through not-for-profit or social motivations, many in the industry now understand that sustainability and commercial viability need to go together. They believe that despite unprecedented efforts to augment access to financial services meaningfully, the full potential is yet to be realised. They are currently working with banks, regulators and governments at various levels in this nascent and fragile sector to take financial inclusion to the next level.

E Governance

Market Environment: E-Governance in India has evolved from computerization of Government Departments to initiatives that encapsulate the finer points of Governance, such as citizen centricity, service orientation and transparency. Lessons from previous e-Governance initiatives have played an important role in shaping the progressive e-Governance strategy of the country. This approach has the potential of enabling huge savings in costs through sharing of core and support infrastructure, enabling interoperability through standards, and of presenting a seamless view of Government to citizens. The National e-Governance Plan (NeGP), takes a view of e-Governance initiatives across the country.

The National E-Governance plan created by the Government of India in 2006 outlines 27 Mission Mode Programs driven by Central and state governments, with some programs involving joint execution by the central and state governments

Glodyne View: In their view, the progression towards higher impact e governance is evident. The intent exists and plans are drawn up. However, they remain selective and cautious on this sector because of the execution challenges in an undertaking of this massive a scale.

Some examples of the challenges they see are:

1. Achieving cross talk and synergies between the 27 mission mode programs

2. Proper understanding of the citizen lifecycle at the field level

3. Envisaging major process reform, not just minor reengineering in systems and procedures.

4. Keeping pace with trends even as technological projects are executed such as mobile, grid and cloud technologies

They selectively focus on projects to maximize shareholder value in the immediate term and strategically position them for recurring revenue streams over longer term

Their work in E-shakti project has won a large number of awards as a model E governance project by several independent agencies. To execute this project, Glodyne put together a complex set of technologies and processes. This resulted in MNREGS projects across various villages getting managed and tracked using a sophisticated system of biometric authentication, smart cards, hand held devices and automated payment to the beneficiaries using linkages with financial inclusion. Governments are getting excited about the potential of such an automation since it can go much beyond managing one program to creating a platform to significantly enhance the citizen services governance in general eg healthcare, direct subsidy transfer, education etc.

Glodyne also bagged a long term contract with the Government of Maharashtra to transform labor management in the state. This program, called Mahashramm, brings together technology, process reengineering and banking channels for the labor force in the state of Maharashtra and allows the government a much greater visibility and transparency in their ability to enforce labor laws for the greater good of the public.

Infrastructure Managed Services

Market Environment: Global IMS Industry has a long legacy but a few years back, this Industry took a revolutionary turn for their country. Towards a cost reduction pursuit, global organizations started looking for low-cost, high-quality alternatives, and they sought global delivery models to achieve these goals. What began as a set of initial experiments has today become a tried and tested approach to managing costs. As per a recent Report by NASSCOm-McKinsey titled ‘Remote Infrastructure Management Services: Igniting India’s leadership (2008)’, globally, the RIM industry is expected to achieve a penetration of 25 to 27 per cent by 2013, a US$20 billion to US$21 billion increase over the revenues of about US$6 billion to US$7 billion today. The Report goes on to state that with Global CIOs’ continued comfort with India as “primary” offshore destination, the country will capture greater than 50 per cent of the world market i.e., US$13 billion to US$15 billion in revenue by 2013, which would create 325000 to 375000 jobs.

Recent surveys of over 140 CIOs by McKinsey and Company suggest that, as customer environments mature, they are more likely to adopt Remote Infrastructure Management. While 18 per cent of CIOs surveyed have offshored some part of infrastructure management, an additional 7 per cent plan to offshore in the next three years while a further 15 per cent plan to offshore, though without a specific timeline. Drivers for this are fairly straightforward- the classic benefit versus costs story : CIOs experience a reduction of almost 25 per cent in their IT infrastructure budget. They are also getting better service, quality and, sometimes significant transformational value from their Indian Remote Infrastructure Management partners.

Glodyne View: For India to realize the full potential of the RIM opportunity, companies must, in an organized way address several success factors including standardizing delivery models to achieve process sophistication and maturity, enhance operational excellence to match global peers by investing in tools, methodologies, efficient processes and enhance sales and marketing capabilities. Decision One provided a unique opportunity to Glodyne to access and participate in the global market. In the past year, Glodyne successfully integrated the Decision One organization in the global organization structure. This allowed them to create a global delivery structure and invest in the aforementioned success factors across all their delivery channels : onsite and offshore

The US market continues to rapidly evolve. The industry is seeing consolidation and mature pricing mechanisms. These trends are being observed across the centralized and decentralized computing environments. Cost efficient platforms, marketing savvy and continuous innovation remain key to success in this environment. These have remained primary areas strategic areas for Glodyne and they are already seeing fruits of clear strategic focus in terms of client retention, new client acquisitions and rising profitability from the operations

Other sectors: Amongst other sectors, Glodyne continues to invest in Education sector- a USD 43BB market, growing at 13% annually. Their focus in the education space has been to

a) continue to penetrate in new and diverse sets of schools and colleges

b) Strengthen their base within existing customer sets with additional content based offerings

This approach has proven to be highly rewarding. They expect this trend to continue in the coming years

Review of financial and operating performance

During the financial year ending March 2012, the Company revenues grew by 63.07% to Rs.16124.706 millions and profit after tax by 78.31% to 2570.484 millions. Over the last 3 years they have grown their revenues at the CAGR of 50.10%.

BUSINESS ANALYSIS

Glodyne is primarily in the business of technology infrastructure management services, focused on optimizing the operational expense of their clients, a core expense they can’t do away with unlike other capex intensive initiatives which could go slow in case of a slowdown.

Geographical Presence: In 2011-2012, the company has presence in India and United States of America. The company is headquartered in Mumbai, India with sales and support presence across India and US. The North America operations are headquartered at Philadelphia which ensures support and sales across N. America.

Sector presence: The company services across ten sectors Government/PSU, IT/ITES, BFSI, Manufacturing, Retail, Media, Telecom, Education, Travel and Healthcare across India and North America.

Mergers and acquisition: In the year 2011 - 2012, the company initiated the acquisition of Comat Technologies. Comat is a specialist e-governance management services company, which has implemented strong solutions in the Food and Civil Supplies and UID implementation across states in the Country.

Through the acquisition the company has been able to enhance its project implementation expertise as it provides a strong back ward integration strategy for the Company.

Awards and Recognition: During the year, the Company was awarded with the following Awards: