Cautionary Announcement

At a board meeting of Caudan Development Limited (Caudan) held on 11^th May 2006, the directors decided to go ahead with Phase 2 of the Caudan Waterfront development, subject to obtaining all permits and final approval from the relevant authorities. Caudan has, since then, obtained the Development Permit for the project, subject to the usual clearances.

Construction works are scheduled to begin in July 2006 for completion in December 2007. The project, comprising essentially 7,200 square metres of office space, 400 odd parking spaces and 2,600 square metres of commercial space, is estimated at Rs 680m and will be financed entirely by bank loans and the sale of offices.

The shareholders of Caudan and the public at large are advised to exercise caution when dealing with the shares of Caudan.

By order of the Board

Jocelyne Martin

Secretary

23rd May 2006

This cautionary announcement is issued pursuant to listing rule 11.3.

The Board of Directors of Caudan Development Limited accepts full responsibility for the accuracy of the information contained in this cautionary announcement.