Dear Shareholder''s
 
 while global economic and financial conditions under pressure most of
 2011, India’s GDP growth was estimated at 6.9% (as per the Economic
 Survey February 2012 report), compared to about 8.4% in the previous
 two financial years. Despite this scenario, I am happy to inform you
 that your company has delivered a good topline growth of 17.30% for the
 financial year ended March 31,2012,although for the entire financial
 year, the profits declined due to pressure on margins and the
 depreciation of the rupee which made import of inputs costlier, Your
 company however, delivered good results for the quarter January to
 March 2012,a performance that has stood out in the 3M world truly
 signifying your Company''s ability to tide over tough economic times.
 
 The year under review has been a steady but mioxed performance in Key
 sectors in the economy with agriculture and services sectors showing
 growth but manufacturing, construction and infrastructure slowing down.
 The growing depreciation of the rupee has resulted in a worrisome
 impact on growth across all sectors. However the economic outlook for
 2012 shows promise as India is expected to grow between 7% and 8% of
 GDP. A positive mov towards the deregulation of interest rates would
 also assist in the growth of savings and investments. All these
 developments indicate that the economic environment is supportive for
 your Company to continue its journey towards becoming a billion dollar
 Company by 2015 as also to improve its profits from the current
 financial year.
 
 In the year under review,3M India continued to accelarate with ''In
 India for India'' strategy with the establishment of two new R&D centres
 at Gurgaon & Bengaluru respectively. 3M India aims to increase your
 Comapny''s new product vitality index to 40% over the next 5 years
 through innovations for the indian market. The new R&D centres will be
 the hubs of localized 3M innovation in India. Local product development
 continued at full steam with your Company introducing to Indian
 customers a wide range of innovation products that help solve problems
 in key markets, automotive, retail, health care and infrastructure.
   
 Your company has been investing in its organizational capability and
 people to make the company to a higher level. During the year under
 review, there was an energized focus on building leadership
 capability, investing in building marketing competencies to build the 3M
 brand in India and develop people to take on new roles and
 responsibilities to lead your Company to the 2015 goal.
 
 3M India continues to be one of the fastest growing subsidiaries in the
 3M world, contributing to global 3M earnings. This is due credit to the
 employees of your Company who have been steadfast in staying on course
 with the goals of the organization. I congratulate the employees and
 management of 3M India for delivering an all-round performance and look
 forward to continued excellence in the coming year.
 
 D.J. Balaji Rao
 
 Chairman