Dear friends,
 
 It was another good year. We produced more pulp and paper and with
 aggressive marketing, saw revenues touching a new high. We achieved
 success in our existing markets, while identifying high potential
 growth opportunities in newer ones.
 
 Over the past 12 months, APPM continued to build on the foundation that
 we had laid in recent years. We benefited from the newly added
 capacity, improved our operating processes and have become a far
 stronger organization with a robust business model. The fundamentals
 that we have put in place are paying off in solid progress.
 
 It was a year when we sold 1.93 lakh MT, the highest ever,
 approximately 9% over the previous year.  The revenues were up by 21.6%
 at Rs.795.9 crore. The EBITDA improved to Rs.163.9 crore from Rs.153.0 crore
 in 2009-10, a rise of 7.1% over the previous year.
 
 The EBITDA margin was affected because of higher input costs and
 retrospective settlement of wage revision following an agreement with
 the union at Unit:APPM. The profit before tax was lower due primarily
 to higher depreciation incurred consequent to the capitalization of
 Paper Machine No.6 (PM6).  The revenues were inadequate to cover the
 costs incurred.  The capitalised newer assets had not stabilized till
 late in the year, while costs were recognized in the books. This is a
 temporary blip in our march towards improved performance.  We see PM6
 to be a key revenue generator in 2011-12 and are confident that we
 would see traction in both revenues and bottom line.
 
 At the same time, I am particularly gratified that pay off of our
 efforts is getting visible in higher volumes and market share. It is
 relevant to highlight that our margin is being improved in 2011-12 and
 beyond by cost effective manufacturing process. We are likely to
 witness a rising volume-margin matrix, which would favourably impact
 the bottom line on a continual basis.
 
 Today, APPM is a globally competitive producer of quality writing and
 printing paper. We are a strong world-class enterprise and I am proud
 to have been part of such institution building. We have indeed built a
 renewed APPM ready for the new era, and I am confident we are poised
 for enduring success.
 
 We have been working for sustain ability on a long term basis.  My
 vision for the future is for APPM to be successful, trusted and
 respected in domestic and global markets as a leading paper
 manufacturing company.
 
 The business has a clear goal: to create value through efficient
 management of our assets, resources and people. As Members are aware,
 the highly respected US based International Paper is taking a major
 stake in APPM, and I am confident that the growth and prospects for the
 Company would be better than at any time before. They are a highly
 successful paper manufacturing company and APPM can look forward to
 their association with renewed optimism. I welcome them to the APPM
 family and wish them and APPM all the very best.
 
 This is my one of my last communications to you. I look back with
 satisfaction on APPM’s achievements and more important, am confident
 that the Company is moving into the best hands in the industry,
 anywhere in the world.
 
                                                  Warm regards
 
                                                  L. N. Bangur
 
                                            Executive Chairman