Dear Shareholders,

The previous year has been a landmark year in your company’s history. We have achieved several milestones that have helped your company realize significant levels of revenue growth. Some of these are — acquiring important new customers, strengthening expertise in cutting-edge technology services,
and developing stronger and more competitive value propositions that help our customers derive more bottom-line profits. Let us review the major accomplishments achieved by your company, the challenges that your company faces in the near-term, and the plan of action that has already been put in place to better understand your company’s direction and growth prospects in the coming year.

Industry Scenario
The past year witnessed a revalidation of the Indian Technology Industry. Industry performance was marked by a sustained double-digit revenue growth, steady expansion into newer service-lines and increased geographic penetration, and an unprecedented rise in investments by Multinational
Corporations (MNCs). With worldwide expenditure crossing $1.5 trillion on technology and related services, the Indian IT and ITES sector looks set to close the year at record levels of revenue and profitability growth, with the revenue aggregate growing by nearly ten times over the past 10 years.

PGSL’s ’s Business Growth
Your company continued to grow at a healthy growth rate of 39.2% Y-O-Y in its overall revenue along with 69.9% growth on the PAT. This growth has happened alongside our extensive investments in expanding the company’s technology infrastructure and deepening the RFID expertise to deliver industry leadership in key segments of the industry. The appreciating Rupee has impacted the profitability of the entire industry along with that of your company. Although the impact has been marginal, the management remains cautious and is seeking to mitigate the currency risks by implementing
the most effective risk management strategies.

Your company is engaged in the following segments: IT services outsourcing, Engineering Services Outsourcing, GIS Services, and RFID services. Most of the company’s achievements have been due to a laser sharp focus on executing on our well defined strategy of marketing and growing our core services in the preferred target markets. It would be useful to go over the major highlights to better understand the specific achievements of the company:

Major Highlights
IT Services Growth: With significant efforts this past year, the company has realized some key customer wins in the IT services segment. We have expanded relationships with the current core customers and have been rewarded for our targeted sales and marketing efforts with the resultant increase in revenue growth.

GIS & Engineering Services growth: The Company added several new clients who have the capability to transform into large and long term engagements. PGSL also brought on board several domain experts who have been and will continue to be instrumental in providing the industry’s leading GIS and Engineering services.

RFID initiative: Your Company has been relentless in its pursuit of excellence in RFID. Till now, we have invested significant time and resources to build up the expertise in the field, interacting with important players in the RFID industry and seeking to develop into a dominant RFID player in the Indian landscape. With this in mind PGSL has actively engaged in sourcing and analyzing other potential players in RFID for probable acquisitions.

The RFID industry as a whole has been gradually developing in distinct ways in two key regions: US and East Asia (China, Japan, & Korea). As a whole RFID is projected to continue its slow but steady growth in the near term but expected to take off after a period of 12 to 18 months with the arrival of rapid advances in hardware design and expanded chip capabilities. You can be assured that as and when the boom in RFID happens, your company will be optimally positioned to capitalize on it.

Infrastructure Expansion: Your Company has been investing heavily in expanding its infrastructure in India and USA. It is in the process of setting up a center of excellence in Bangalore to showcase its capabilities in high-tech solutions. It is also expanding its presence in West Coast of USA with a
concentrated focus on targeting the lucrative business landscape in the Silicon Valley. Such efforts will allow PGSL to move up the value chain in its offerings and realize higher net margin from quality engagements.

Acquisitions: Your Company has been actively seeking potential acquisition candidates with varied business models focused on the IT industry. The past two quarters have seen a flurry of activity where several potential companies have been analyzed. With a view to finding the right niche players possessing
strong management and a scalable business model, we will continue to engage in targeting and analyzing potential acquisitions. The management believes that your company will be significantly rewarded by continuing such efforts.

Future market trends
Worldwide technology related spends are forecast to reach USD 2.1 trillion by 2010, growing at a CAGR of more than 7 percent over 2006-2010. Growth in global sourcing is expected to outpace growth in total spends, with up to USD 110-120 billion of the total amount spent on software and services in 2010, likely to be sourced through the global delivery model.

Rapid evolution of technologies and Internet applications, and the rise of pervasive computing are expected to drive a rapid and quantum increase in technology adoption by businesses and individuals. The proliferation of client devices and end-user or end-use devices at the network edge will result in the addition of billions of devices to the network edge, driving the need for more enterprise systems to deploy, manage, and make use of them. The effects of the internet generation entering the working-age population are expected to further accelerate technology usage and adoption.

Such industry growth rates are naturally expected to help your company achieve strong growth in all of its sectors. With the current value proposition of the company, the different segments are well positioned to handle the expected challenges that will be faced in pursuit of this growth.

Emphasis on core
Your company is focused on growing its core offerings in the target markets with the same aggressiveness of the past year. The robust growth of the past year is proof that our strategy of emphasizing on the core has been the best route toward expanding revenue and profitable opportunities.

Continued investment in the future
In terms of strategy, your company enters 2009 with a focus to enhance its infrastructure, expand the marketing reach, improve its technology offerings and refine its delivery process to help its customers realize better Returns on Investment. This aggressive organic growth will be supplemented by an inorganic drive toward acquiring businesses that are optimal for our existing technology business. With a proven track record on excellent strategy, we are confident that our emphasis in 2009 on building new relationships and opening the doors to new technologies, emerging technology trends and best practices will only enhance the value of your company in the eyes of the industry, shareholders and employees. As always we back our strategy with a tremendous focus on action. Our teams of experts continue to grow in quality and quantity offering the best solutions for our clients. With a determination to achieve our strategic goals of 2009 in mind, our focus on execution remains unfaltering. We appreciate and respect the faith you have put into us for the past year and hope to instill pride in you for being willing stakeholders in this Company during this exciting time for technology industry in India.
Best Wishes for the New Year,

Chairman’s message