Preliminary Results

India Outsourcing Services PLC
29 March 2006


For immediate release                                             29 March 2006


                         INDIA OUTSOURCING SERVICES PLC
                     ('India Outsourcing' or 'the Company')

          Preliminary Results for the period ended 30 September 2005


India Outsourcing Services plc (AIM: IOS), a company formed to capitalise on
acquisition and investment opportunities in the business process outsourcing
(BPO) industry, is pleased to announce its preliminary results for the period
ended 30 September 2005.





Highlights



The Company has made significant progress in pursuing its strategy of
identifying and evaluating potential acquisitions in the business process
outsourcing (BPO) industry primarily within India.



Growth remains strong in the Indian BPO market, which is estimated to have grown
by about 40 per cent during 2004/5 to reach $5 billion and is forecast to reach
$21 billion by 2008 (source: NASSCOM - McKinsey).



The Company has exercised careful cost control, reporting net cash of £359,795
at 30 September 2005. A successful placing, post the period end in February
2006, raised £3 million before expenses.



On 21 March 2006, the Company announced that strategic investor 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.





Amit Pau, Chief Executive of India Outsourcing Services, commented: 'We are
pleased to report considerable progress at the Company, highlighted by our
recent £3 million fundraising and further £0.5 million investment from Wheddon
Limited. We are moving closer to identifying our first acquisition which,
together with the continuing strong growth of the Indian BPO market, gives us
confidence in the future. '





For further information:


India Outsourcing Services plc                       Tel: [phone]
Haresh Kanabar, Chairman
Amit Pau, Chief Executive

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

Buchanan Communications                              Tel: [phone]
Mark Court/Elly Williamson





Extracts from the Chairman's statement and the report of the directors



I am pleased to report India Outsourcing's maiden results for the period ended
30 September 2005. The period under review, and the start of this financial
year, have both been exciting periods in the development of the Company.



India Outsourcing joined AIM in December 2004 with the strategy of seeking,
evaluating and completing the acquisition of companies in the business process
outsourcing (BPO) industry primarily in India.  Since flotation we have
continued to pursue this strategy, the rationale for which has been underlined
by the on-going formidable growth in the BPO industry.



On flotation we implemented a rigorous search for acquisitions using specific
criteria to ensure that any potential acquisition meets the Company's
over-riding objective of creating value for shareholders.  These criteria, which
potential acquisitions must demonstrate, include requirements for the potential
acquisition to show strong growth prospects, recurring revenue streams, scalable
delivery platforms and established client relationships.



During the period under review, we pursued in detail several potential
acquisitions, embarking on due diligence on one such target.  However, during
the due diligence process a change occurred in the target's customer base,
potentially affecting the order book going forward. As a result we decided not
to pursue the acquisition because of the additional element of risk associated
with the transaction. While we incurred some professional fees, the decision not
to pursue the acquisition met our strategic objective that any acquisition must
be capable of creating value for shareholders.



In total, we have evaluated around 50 potential acquisitions, primarily in India
but also in countries including the US, and we are moving closer to identifying
our initial preferred acquisition candidate.



We have exercised careful cost control at the Company, having finished the
period end with net cash of £359,795.  Post the period end, our balance sheet
has been strengthened considerably following a successful placing, announced on
9 February 2006, to raise £3 million before expenses. In addition, Wheddon
Limited, a strategic investor in the Company and an investment vehicle
associated with Vincent Tchenguiz' Consensus Business Group, subscribed for an
additional 1,000,000 ordinary shares in the Company at 50p per share.



We believe that this additional balance sheet strength has increased the
credibility of the Company with the vendors of potential acquisition targets in
addition to providing additional working capital.  The placing broadened the
Company's institutional shareholder base and I would like to take this
opportunity to welcome all new shareholders to the Company.



In addition, over the past few months, India Outsourcing has been working with
Consensus Business Group, Vincent Tchenguiz' venture capital arm, to identify
opportunities where India Outsourcing could provide offshoring solutions to
Consensus' portfolio companies.



India Outsourcing reported a pre-tax loss of £424,369 for the period ended 30
September 2005 and a loss per share of 3.48p.



Outlook



The current financial year has started well both in terms of progress in
identifying suitable acquisition candidates and in terms of the strengthened
balance sheet that the recent placing has brought.  We look forward with
confidence to the remainder of the current year and will update shareholders in
due course on the further development of our strategy.



Results and dividends



The profit and loss account shows the loss for the period.

The directors do not recommend the payment of a dividend for the period. The
loss will be transferred to reserves.



Principal activities



The principal activity of the company is to capitalise on acquisition and
investment opportunities within the Business Process Outsourcing sector
primarily in India.







Haresh Kanabar

Chairman

29 March 2006



INDIA OUTSOURCING SERVICES PLC

Profit and loss account for the period ended 30 September 2005




                                                                    £

Administrative expenses                                       432,503

Operating loss                                               (432,503)

Net interest receivable                                         8,134

Loss on ordinary activities before taxation                  (424,369)

Tax on loss on ordinary activities                                  -

Loss on ordinary activities after taxation                   (424,369)

Loss per share -basic and diluted                              (3.48)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 30 September 2005


                                                      £                   £

Fixed assets                                                          4,078
Tangible assets

Current assets
Debtors                                           5,037
Cash at bank and in hand                        359,795
                                                364,832

Creditors falling due within one year           106,015

Net current assets                                                  258,817

Total assets less current liabilities                               262,895

Capital and reserves                                                181,250
Called up share capital                                             506,014
Share premium account                                              (424,369)
Profit and loss account

Shareholders' funds - equity                                        262,895







INDIA OUTSOURCING SERVICES PLC

Cash flow statement for the period ended 30 September 2005


                                                                                     £                    £

Net cash outflow from operating activities                                                         (329,729)

Returns on investments and servicing of finance
Interest received                                                                8,134

Net cash inflow from returns on investments and servicing of finance                                  8,134



Capital expenditure
Purchase of tangible fixed assets                                                (5,874)

Net cash outflow for capital expenditure                                                             (5,874)

Net cash outflow before financing                                                                  (327,469)

Financing
Issue of ordinary shares                                                         800,000
Expenses paid in connection with share issues                                   (112,736)

Cash inflow from financing                                                                          687,264

Increase in net cash in the period                                                                  359,795








Notes to the financial statements



1          Accounting policies



                        Basis of preparation

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.



                        Tangible fixed assets

Tangible fixed assets are stated at cost less depreciation. Depreciation is
provided at rates calculated to write off the cost less the estimated residual
value of each asset over its expected useful economic life, as follows:



                        Office and computer equipment - 2 years on a
                        straight-line basis



2          Loss per ordinary share



The calculation of basic and diluted loss per share of 3.48 pence is based on
the loss for the period of £424,369 and on 12,211,565 ordinary shares, being the
weighted average number of ordinary shares in issue during the period ended 30
September 2005. There were no potential ordinary shares at the period end.



3          Post balance sheet events



On the 9 February 2006 the company announced that through Daniel Stewart, it had
conditionally placed 6,666,667 new ordinary shares raising a total of £3.0
million before expenses.  The Placing Shares were placed at 45p a share, on the
basis of the consolidation of every 10 ordinary shares of 1p each into 1
ordinary share of 10p. The new ordinary shares of 10p each of the Company were
admitted to trading on the AIM on 7 March 2006.



The Placing to raise a total of £3 million before expenses will allow the
Company to pursue its strategy of identifying, evaluating and, ultimately,
completing acquisitions in the business process outsourcing industry primarily
within India.



On the 21 March 2006 the company announced that it had placed an additional
1,000,000 ordinary shares of 10p each at 50p a share, raising a total of £0.5
million to Wheddon Limited. This purchase brings Wheddon's total shareholding to
1,312,500 shares, equivalent to 13.85 per cent of the Company's issued share
capital.





Basis of preparation



The results have been prepared using accounting policies consistent with those
used in the preparation of the statutory accounts. The financial information is
derived from the financial statements for the period ended 30 September 2005,
and does not constitute full accounts within the meaning of Section 240 of the
Companies Act 1985. The financial statements on which the auditors have given an
unqualified report do not contain a statement under Section 237 (2) or  (3)  of
the Companies Act and will be delivered to the Registrar of Companies in due
course.



The Annual Report will be sent to all shareholders. Additional copies are
available from 22 Soho Square, London W1D 4NS


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