Interim Results

India Outsourcing Services PLC
28 June 2006


For immediate release                                              28 June 2006



                         INDIA OUTSOURCING SERVICES PLC

                     ('India Outsourcing' or 'the Company')


             Interim Results for the six months ended 31 March 2006


India Outsourcing Services plc (AIM: IOS), a company formed to capitalise on
acquisition and investment opportunities primarily in the Indian business
process outsourcing (BPO) market, is pleased to announce its interim results for
the six months to 31 March 2006.



Highlights

  • A successful placing in Feburary 2006 raised £3 million before expenses to
    assist the Company to pursue its strategy of building an international
    outsourcing business through acquisition

  • After a thorough search, the Company is now focussing its attention on a
    specific opportunity from a limited number of potential acquisition
    candidates. The Company realises this process has been protracted but hopes
    to be in a position to provide shareholders with an update in the near
    future

  • Wheddon Limited, an investment vehicle associated with Vincent Tchenguiz'
    Consensus Business Group, invested a further £0.5 million in the Company by
    subscribing for 1 million shares at 50p per share

  • India Outsourcing is working with Consensus Business Group to identify
    opportunities where the Company can provide offshoring solutions to
    Consensus' portfolio companies

  • Balance sheet remains strong, with net cash at the period end of £3.37
    million


Haresh Kanabar, India Outsourcing's Chairman, commented: 'Our search for
acquisitions has been detailed and selective but I am satisfied by the progress
made during the period, and post the period end, as we continue to move closer
towards our first transaction.'



For further information:

India Outsourcing Services plc                              Tel: [phone]
Haresh Kanabar, Chairman

Amit Pau, Chief Executive

Teather & Greenwood                                         Tel: [phone]
Mark Dickenson
Sindre Ottesen

Buchanan Communications                                     Tel: [phone]
Mark Court/Suzanne Brocks/Amy Rajendran



CHAIRMAN'S STATEMENT


I am pleased to report India Outsourcing's interim results for the six months to
31 March 2006, a period during which we made further progress towards the
delivery of our strategy of creating through acquisition an international
outsourcing business with a focus on the Indian business processing outsourcing
(BPO) market.

The Indian BPO market continues to grow strongly, reinforcing our confidence in
the Company's strategy. A recent forecast by NASSCOMM and McKinsey indicates
that the Indian BPO market will be worth $21 billion by 2008.

Our search for acquisition opportunities has been thorough. We have looked at a
number of potential acquisition candidates but have been highly selective. Our
acquisition criteria include requirements including that potential acquisition
is should be revenue-generating, scalable, cashflow positive, have strong
management teams and recurring revenues.

The Company's ultimate objective is to acquire a small number of complementary
companies to exploit cross selling opportunities and to benefit from cost
reduction. The market segments that we are focussing on are document management
and healthcare.  The Company has made significant progress in evaluating one
particular acquisition opportunity, although there is no certainty at this stage
that this transaction will complete.  We look forward to providing further
details in due course.

The Company's balance sheet was strengthened during the period by a £3 million
fundraising before expenses in which new institutional shareholders joined the
Company's register. At the time of this fundraising the Company's shares were
consolidated on a 10 for 1 basis to ensure that the Company's shares are
attractive to institutional investors.

On 21 March, the Company was delighted to attract a further strategic investment
from Wheddon Limited ('Wheddon'), an investment vehicle associated with Vincent
Tchenguiz' Consensus Business Group.  The investment, in 1 million shares in the
Company at 50p a share, marks the second strategic investment in the Company by
Wheddon.

The Company is now working with Consensus Business Group to identify
opportunities where the Company can provide offshoring solutions to Consensus
Business Group's portfolio companies. We look forward to updating shareholders
in due course on progress with this relationship.

Financials

The Company's performance in the period was in line with management
expectations. The pre- and post-tax loss in the period was £(213,808) and the
loss per share was (7.33)p. The Company's net cash as at 31 March 2006 was £3.37
million.

Outlook

The second half of the financial year has started well in terms of progress with
the delivery of our strategy. The Indian BPO market is growing at a formidable
pace and we hope to be in a position to provide  shareholders with further
updates in the near future.



Haresh Kanabar
Chairman
28 June 2006




India Outsourcing Services Plc

Profit and loss account for the period ended 31 March 2006

                                                  6 months ended           6 months ended           period ended
                                                   31 March 2006            31 March 2005      30 September 2005
                                                     (unaudited)              (unaudited)              (audited)
                                                               £                        £                      £

Administrative expenses                                  226,888                  106,037                432,503


Operating Loss                                         (226,888)                (106,037)              (432,503)

Net Interest receivable                                   13,080                    4,404                   8134

Loss on ordinary activities before taxation            (213,808)                (101,633)              (424,369)

Tax on loss on ordinary activities                             -                        -                      -

Loss on ordinary activities after taxation             (213,808)                (101,633)              (424,369)

Loss per share- basic and diluted                        (7.33)p                  (11.4)p               (34.75)p



All amounts relate to continuing activities.

All recognised gains and losses for the period have been included in the profit
and loss account.



India Outsourcing Services Plc

Balance sheet at 31 March 2006

                                                      6 months ended     6 months ended             period ended
                                                       31 March 2006      31 March 2005        30 September 2005
                                                         (unaudited)        (unaudited)                (audited)
                                                                   £                  £                        £

Fixed assets                                                   2,609              5,162                    4,078
Tangible assets

Current assets

Debtors                                                       44,777             61,541                     5037
Cash at bank and in hand                                   3,373,237            394,527                  359,795

                                                           3,418,014            456,068                  364,832

Creditors falling due within one year                      (111,843)          (113,458)                (106,015)

Net current assets                                         3,306,171            342,610                  258,817

Total assets less current liabilities                      3,308,780            347,772                  262,895

Capital and reserves
Called up share capital                                      947,917            150,000                  181,250
Share premium account                                      2,999,040            299,405                  506,014
Profit and loss account                                    (638,177)          (101,633)                (424,369)

Shareholders funds - equity                                3,308,780            347,772                  262,895




India Outsourcing Services Plc

Cash flow statement for the period ended 31 March 2006

                                                       6 months ended     6 months ended            period ended
                                                        31 March 2006      31 March 2005       30 September 2005
                                                          (unaudited)        (unaudited)               (audited)
                                                                    £                  £                       £

Net cash outflow from operating activities                  (259,330)           (53,776)               (329,729)

Returns on investments and servicing of finance
Interest received                                              13,080              4,404                   8,134

Net cash inflow from returns on investments                    13,080              4,404                   8,134
and servicing of finance


Capital expenditure

Purchase of tangible fixed assets                                   -            (5,505)                 (5,874)

Net cash outflow for capital expenditure                            -            (5,505)                 (5,874)

Net cash outflow before financing                           (246,250)           (54,877)               (327,469)

Financing
Issue of ordinary shares                                    3,500,000            550,000                 800,000
Expenses paid in connection with share issues               (240,308)          (100,596)                 112,736

Cash inflow from financing                                  3,259,692            449,404                 687,264

Increase in net cash in the period                          3,013,442            394,527                 359,795




India Outsourcing Services Plc

Notes to the Interim Report

1. Basis of preparation

The interim accounts for the six months ended 31 March 2006 are unaudited and do
not constitute statutory accounts in accordance with section 240 of the
Companies Act 1985.

The financial statements have been prepared in accordance with currently
applicable Accounting Standards in the United Kingdom, which have been applied
consistently, and under the historical cost convention.

Accounting policies consistent with those applied in the financial statements
for the period ended 30 September 2005 have been used in preparing the unaudited
interim financial statements for the 6 months ended March 2006.

2. Taxation

There is no tax charge for the period due to the loss arising.

3. Dividends

The Directors are not declaring a dividend for the six months ended 31 March
2006.

4. Loss per ordinary share

The calculation of basic and diluted loss per share of 7.33 pence is based on
the loss for the period of £213,808 and on 2,915,064 ordinary shares, being the
weighted average number of ordinary shares in issue during the period ended 31
March 2006. The effect of all potential ordinary shares is antidilutive and
therefore dilutive EPS is the same as basic EPS.

5. Copies of interim results

Copies of the interim results are available from the Company's office, 22 Soho
Square, London W1D 4NS.






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