Balance Sheet

OTCEI SECURITIES LIMITED  BALANCE SHEET AS AT MARCH  31, 2006 (All amounts in Indian rupees)  Current Year  Previous Year Schedule Amount Amount SOURCES OF FUNDS SHAREHOLDERS' FUNDS     Share Capital 1     42,500,700              42,500,700 UNSECURED LOANS (A)  Advances from OTC Exchange of India                   -                                - (B)  Deposits from Sub-brokers 2       8,660,390                9,318,190   51,161,090           51,818,890 APPLICATION OF FUNDS FIXED ASSETS 3     Gross Block       3,768,437                3,653,037     Less: Accumulated Depreciation       3,533,576                2,937,436     Net Block        234,861                715,601 INVESTMENTS 4                   -                304,670 DEFERRED TAX ASSET 5                       -                                - CURRENT ASSETS,LOANS AND ADVANCES     Sundry Debtors 6          644,372                5,765,801     Cash and Bank Balances 7    48,833,187              40,953,584     Other Current Assets 8          538,225                   496,788     Loans & Advances 9      25,000,000               25,000,000     75,015,784              72,216,173 LESS: CURRENT LIABILITIES AND PROVISIONS      Liabilities 10    37,514,799              35,550,747    37,514,799              35,550,747 NET CURRENT ASSETS     37,500,985              36,665,426 PROFIT AND LOSS ACCOUNT - NET LOSS    13,425,242              14,133,193   51,161,090           51,818,890 Notes forming part of  Accounts 10 Notes forming part of  Accounts 12 As per our report                                          Prof. G Sethu Shri S C Bhargava Director Chairman For K.S. Aiyar & Co.                          Chartered Accountants Raghuvir M. Aiyar                                                              Shri Munesh Goel Partner                                                                                CEO (O) & Company Secretary Mumbai. Dated: 20th June,2006

OTCEI SECURITIES LIMITED PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED MARCH 31, 2006 (All amounts in Indian rupees)  Current Year  Previous Year Schedule Amount Amount INCOME      Brokerage        1,819,841                1,192,886      Dividend on units of Mutual Funds                      -                       48,011      Interest from Investments in bank deposits        1,824,919                1,635,945        (Tax Deducted at Source Current Year Rs. Nil )        (Tax Deducted at Source Previous Year Rs.42341)      Profit on Sale of Investments                1,435                   290,539      Other Income              66,898                     90,195      Penalty Income              63,010                   331,350       3,776,104             3,588,925 EXPENDITURE     Insurance Premium              18,000                     39,084     Deputation Costs (Refer Note 2.c)        1,297,467                1,295,158     Asset Usage Charges  (Refer Note 2.d)              79,665                     79,665     Other Expenses 11         1,056,516                1,005,923     Depreciation            596,140                   592,158       3,047,787             3,011,988 NET PROFIT / (LOSS) BEFORE TAX            728,316                   576,937     - Current                        -                                -     - Deferred Tax Expense (Refer Note 2.f.ii)            413,482                   268,076     - Fringe Benefit Tax              20,366                                - NET PROFIT / (LOSS) AFTER TAX            294,468                   308,861 NET (LOSS) BROUGHT FORWARD     (14,133,193)             (14,710,130) OPENING DEFERRED TAX CREDIT RECOGNISED (Refer Note 2.f.ii)            413,482                   268,076 NET (LOSS) CARRIED FORWARD TO BALANCE SHEET    (13,425,242)          (14,133,193) EARNINGS PER EQUITY SHARE OF RS. 10/- EACH 0.07 0.08 (Basic and diluted - Refer Note h) Notes forming part of  Accounts 10 Notes forming part of  Accounts 12                                                  As per our report                                          Prof. G Sethu Shri S C Bhargava Director Chairman For K.S. Aiyar & Co.                          Chartered Accountants Raghuvir M. Aiyar                                                              Shri Munesh Goel Partner                                                                                CEO (O) & Company Secretary Mumbai. Dated: 20th June,2006