Walchand Peoplefirst Ltd

The Members of

WALCHAND PEOPLEFIRST LIMITED

Your Directors present herewith the 91st Annual Report together with the AuditedStatement of Accounts and Auditors' Report thereon for the Financial Year ended March 31,2011.

1. FINANCIAL RESULTS

2. DIVIDEND

Your Directors have decided not to recommend any dividend for the year ended March 31,2011.

3. CONSERVATION OF ENERGY. TECHNOLOGY ABSORPnON AND FOREIGN EXCHANGE EARNINGS AND OUTGO(Section 217(1)(e) of the Companies Act. 1956)

Particulars required to be furnished by the Companies (Disclosure of particulars in thereport of the Board of Directors) Rules, 1988 are as follows:-

a. Rule 2(A) pertaining to Conservation of Energy and Rule 2(B) pertaining toTechnology absorption are not applicable to the Company.

b. Foreign exchange inflow and outflow - Rule 2(C):

(Rs. in Lacs)

Industry Structure & Analysis

The Indian economy grew at 8.6% in fiscal 2010, the fastest in three years, on the backof a sharp recovery in farm output. Manufacturing and services sectors have registeredimpressive gains during the year. Savings and investments are looking up while exports arerising. Overall the medium term prospects to fiscal consolidation look bright.

India takes pride in its demographic dividend and the people-factor has propelled Indiainto a new opportunity landscape, thus creating a niche for itself in Knowledge Services.The population issue, which has been viewed mostly as a burden until now, is now beingseen as a positive parameter, if we can find a smart way of turning this to our advantage.According to a BCG Report, in 2020, when most countries in the world would have a shortageof talent, India will have surplus talent accounting for the highest number i.e 47million. The moot point is, how is India going to be able to take advantage of thissurplus and service the global shortage for talent. The answer lies in making suchresources equipped with skills that are in short supply today and are likely to be indemand in the next decade. In order to make the resources employable, systematic planningand implementation involving various agencies and building a whole new eco system tosupport this would be essential.

Skill Development is a significant factor of human capital formation to ensure that thecountry's demographic dividend is not replaced by a demographic deficit. Primacy to skilldevelopment is critical for creating a long-term sustainable growth engine for ourcountry.

India is the third largest country in terms of graduates passing each year - 20,677colleges, 416 universities and 11.6 millions students were enrolled in 2007 -08, of whichabout 3.5 million students graduate every year. But only around 10-25 percent of graduatesmeet the requirements for organized sector jobs. Of the current total workforce, 40percent is illiterate and another 40 percent constitutes schools dropouts. A little morethan half the workforce of almost 500 million find their livelihood in farming.

For the rest, almost 90 percent of jobs available require some level of skills while 9percent are knowledge-based and 1 percent is a combination of both knowledge and skills.

There is a significant gap in what our education system prepares to do and whatorganizations and ultimately customers want. Currently, much of this is also beingaddressed by companies directly as they have to successfully get their human resources todeliver business results.

What is also interesting is to take a look at the sectoral employment status in Indiaover the years. The slant is now towards manufacturing and service sectors with the shareof agriculture dwindling. This clearly highlights the urgent need for creating a robustskiling framework - one that would enable the youth, which will enter the workforce tobecome employable and more productive.

As far as requirements of the service sector are concerned, the education system is notgeared to anticipate and proactively address them in time, leaving a yawning gap betweensupply and demand. This gap has been seen in almost every sector of the service industry -be it IT, ITES, Retail or Hospitality. Organizations have had to incur huge amounts ofmoney in repair and rework on already trained / educated resources once they are broughtinto the fold of the corporate sector thus delaying their productive contribution towardseconomic value creation. Further, in many industries, due to limited availability oftalent pool, it leads to attrition and increase in compensation, thus adding to the costsof operations.

India with its increasing youth population (currently 69 percent of the population arebetween 16 and 29 years) has an unprecedented opportunity to accelerate growth and reducepoverty. However, to harness this opportunity, it is necessary to build human capitalacross all levels of education and skill development.

Opportunities & Challenges

The training industry in India has evolved significantly in the past 7 years. As perindustry estimates, the total market-size is around Rs. 11000 crores. Of this, the softskills development market alone accounts for about Rs. 3000 crores.

The overall mindset to training has witnessed a paradigm shift. Training has evolvedfrom being a feel-good, reward-centric system, to a performance-linked setup employingbest practices and challenging benchmarks. The over arching talent and skills shortage intoday's workforce has made it to the top of the CEO's agenda. It is no longer just aconcern within the HR domain but has reached a stage where it warrants a mainstreamdecision.

The overall industry scenario spells two clear streams for growth for your company. Thefirst is in the large need for skilling and employability training for young studentsthrough the Finishing School and supporting the growing trends in recruitment and talentacquisition for companies. The second significant opjwrtunity is to support the corporatesector in managing attrition and enhancing retention and growth of their workforce throughstrong professional development initiatives.

Today's business environment poses its unique challenges on people management. Businessgrowth in India is much higher than the organizational capability for growth and hencecompanies need to bridge the gap through external service providers. Efficiency inmanaging people processes is also becoming significant, and therefore attracting moreattention and investment. Today, HR spending has the CEO's and CFO's attention andorganizations are striving to find the right partners that will help them in this rapidgrowth phase.

An integrated approach to talent management and development has become a strategiccomponent of any business regardless of the industry it belongs to. Talent challenges aremanifold and there is an increasing cost implication in finding and hiring talent, puttingmost businesses, especially the people-intensive ones, under pressure. The solution liesnot in recruitment alone, where our Finishing School services enhance our clients successin this area, but in an integrated strategy for recruitment, development and performancemanagement to ensure that the talent pipeline can support business growth. Ghentorganizations seek flexible business solutions to address these issues in a dynamic world.Your company's experience in providing end-to-end, customized solutions for talentmanagement and development is our competitive advantage in the industry.

Overall the growth opportunities are well-defined and clear. Our approach is toconsolidate on our strategic path to be able to service the market needs better than ourcompetition. We will need to maintain our agility and innovation will be key to providingeffective solutions to our client organizations.

The challenges will come in the form of building and maintaining our own talentpipeline and service quality as we expand to meet the burgeoning need. Also as more andmore players are attracted into this industry, pricing pressures will build with marketcompetitiveness. Our challenge will be to continuously evaluate our cost models and ensurethat we keep improving our productivities.

Outlook, Risks & Control

Acknowledging severe inflation threats, the Reserve Bank of India in its annual policyreview pegged the real GDP growth rate for 2011-12 at 8% - down from the estimated 8.6%growth in 2010-11. This is almost 1 percentage point lower than the government estimate of9%. RBI said most business confidence surveys conducted by various agencies show a declinein business confidence. The pace of industrial activity has been slowing mainly due to theimpact of past monetary policy actions and high input prices. Sections of the industrywill hurt and consumers, who have borrowed to finance purchases, too, will feel the pinchof a tighter monetary policy. Hence while the medium term outlook is good, the outlook forthe fiscal year 2011-12 is cautious.

Yet your company has recovered well from the economic slowdown and has already broughtin cost efficiencies that have resulted in a significant turnaround in its financialperformance for the year. During the year the management has also re-organized its marketstrategies to build more stable strategic and long term client partnerships. With the morerobust organization structure the company is expected to have a positive outlook in boththe short and medium term.

5, PARTICULARS OF EMPLOYEES

The provisions of Section 217 (2A) of the Companies Act, 1956 read with the Companies(Particulars of Employees) Rules, 1975 as amended vide Notification no. G.S.R 289 (E)dated March 31,2011 require the disclosure of the names and particulars of the employeeswho are receipt of remuneration for the financial year under review which, in theaggregate, was not less than Rs. 60,00,000/- or who was in receipt of remuneration for anypart of the financial year under review, at a rate which, in the aggregate, was not lessthan Rs. 500,000/-. The disclosure under the said Section is not given as there are nosuch employees.

6. INVESTMENTS

During the Financial Year under report, the outstanding position in the investment ofshares and debentures of various companies were to the tune of Rs. 116.39 lacs as comparedto the last Financial Year's investment of Rs. 248.56 lacs.

The Book value of the quoted investments for the year under review was Rs. 23.40 lacs(previous year Rs. 23.40 lacs) and its market valuation was Rs. 15.21 lacs (previous yearRs. 16.54 lacs).

7. FIXED DEPOSIT

The Company has not accepted any deposits from public under the Provisions of Section58A of the Companies Act 1956 and rules framed thereunder during the Financial Year ended31st March 2011. As at March 31, 2011, there is no outstanding liability to fixeddepositors.

8. DIRECTORS' RESPONSIBILITY STATEMENT

To the best of their knowledge and belief and according to the information andexplanation obtained by them, your Directors make the following statement in terms ofSection 217(2AA) of the Companies Act, 1956:

i) that in the preparation of the Annual Accounts for the financial year ended March31,2011, the applicable accounting standards had been followed along with properexplanation relating to material departures;

ii) that the Directors had selected such accounting policies and applied themconsistently and mad e judgments and estimates that are reasonable and prudent so as togive a true and fair view of the state of affairs of the Company at the end of thefinancial year ended March 31, 2011 and of the Profit of the Company for the said year;

iii) that the Directors have taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of the Companies Act,1956,for safeguarding the assets of the Company and for preventing and detecting fraud andother irregularities;

iv) that the Directors have prepared the Annual Accounts for the year ended March31,2011, on a going concern basis.

9. DIRECTORS

Ms. Poonam Barua, Director of the Company resigned from the Directorship of the Companywith effect from May 10, 2011. Pursuant to Articles of Association of the Company andprovisions of the Companies Act, 1956, Mr. V. K. Verma and Ms. Pallavi Jha retire byrotation at the ensuing Annual General Meeting and being eligible, offer themselves forre-appointment Your Directors recommend their re- appointment

10. STATUTORY AUDITORS

You are requested to appoint Auditors for the current year and fix their remuneration.The Auditors of the Company, M/s. K.S. Aiyar & Co., Chartered Accountants retire atensuing Annual General Meeting of the Company and have given their consent forre-appointment. The Company has also received a certificate from them imder section224(1B) of the Companies Act, 1956.

11. COMPLIANCE CERTIFICATE

As per Section 383A of the Companies Act, 1956 read with Notification No. G.S.R. 11(E), Dated 5-1-2010 issued by the Ministry of Corporate Affairs, a Company having the paidup Share Capital of Rs. 10 Lacs or more but less than Rs. 5 Crores must obtain aCompliance Certificate from a Company Secretary in whole time practice and suchCertificate must be annexed to the Report. A Compliance Certificate obtained from PramodS. Shah & Associates - Practising Company Secretaries is annexed as a part of theDirectors Report.

12. CORPORATE GOVERNANCE

Pursuant to Clause 49 of the Listing Agreement with the Stock Exchanges, a ComplianceReport on Corporate Governance together with the Certificate from Pramod S. Shah &Associates - Practising Company Secretaries is annexed as a part of the Annual Report.

13. COST AUDIT

The Company is not required to undertake the cost audit as required under Section 233 Bof the Companies Act, 1956.

14. ACKNOWLEDGMENT

Your Directors take this opportunity to express their grateful appreciation for theexcellent assistance and co-operation received from Clients, Vendors, FinancialInstitutions, Bankers, Business Associates and various Governmental, as well as RegulatoryAgencies for their valuable support. Your Directors also wish to place on record theirappreciation for the contribution made by the employees.