Dear Shareholders
 
 Overview of the Company''s performance in 2010-11.
 
 The Company''s performance in 2010-11was creditable for two reasons
 (short and long-term).  From a short-term perspective, we reported a
 47.93% growth in revenues and a 46.23% increase in cash profit.
 
 From a long-term perspective, we strengthened our business model
 through acquisitions, expansion, retail penetration and value-addition.
 This urgency to engage in multi-directional improvement was on account
 of a large emerging opportunity for our products and driven by the
 urgency to emerge as a million tonne pipes and tubes company by 2015.
 
 Investing in making this growth a reality.
 
 What we would like to impress upon our shareholders is that during the
 last few years, we made some cash infusions to create a foundation that
 will enable us to fast-track our growth. As a result, we grew our
 capacity from 0.05 mn TPA to 0.5 mn TPA. This marks the
 
 beginning of the second phase of our growth whereby we invested
 adequately in our production capacities to grow 50% for the next two
 years and emerge with projected revenues of US$ half billion by
 2012-13. That will mark the commissioning of the third phase following
 which we will scale to projected revenues of a billion dollars by 2015.
 This means that what we achieved so far, we now intend to multiply
 five- fold in the next five years.
 
 The national context to make this a reality.
 
 India is where China was a decade ago. As India continues to remain the
 second-fastest growing economy in the world, incomes will rise. It has
 been our experience that tubes and specialised pipes represent one of
 the most visible proxies of any growth economy. This means that for an
 opportunity-focused manufacturer like us this represents room to raise
 volumes without compromising margins, leading to an opportunity to use
 the available surplus for onward reinvestment. As a result, the
 emerging opportunity in India represents exciting headroom for robust
 sustainable growth.
 
 The link between India''s infrastructure and our business.
 
 We are at the moment in our country''s growth where a number of
 developed countries were a few decades ago. As we proceed, the country
 expects to make an unprecedented investment in its infrastructure.
 
 Take two instances - airport and urban metro connectivity. There is a
 growing consensus that for a country as large as India with a growing
 need for people to commute from one national point to another, there is
 a large need not just for better airports to replace the ones that
 exist but also a need for some to be commissioned where none exist.
 
 This is already happening: India is expected to expand its existing 85
 airports to 400 in 10 years, widening the demand for products
 manufactured by APL Apollo Tubes. With Delhi and Mumbai emerging among
 the top ten cities in the world, and with 19 mega cities in India with
 populations in excess of 10 million, only three (including Bengaluru
 that will be shortly commissioned) enjoy metro connectivity. This
 scenario will soon change. As India urbanises, there will be a larger
 pressure to evacuate commuters with speed from in-city locations. The
 metro is emerging as a preferred transportation medium on account of
 its elevation above the road level or beneath the surface, congestion
 freedom, predictable service frequency, speed of commute and relative
 travel convenience.
 
 Apart from the above two industry sectors, the specialised niche of
 tubes and pipes manufactured by us gives us a sunrise opportunity
 
 The Company''s response to this emerging opportunity.
 
 Our Company recognised a growing need to service the large and varied
 demand with speed. The legacy approach was to service this demand from
 a centralised point; with a number of clients requiring quicker
 delivery, our Company extended manufacturing presence to western India
 through the acquisition of Lloyds Line Pipes Ltd in Murbad, Maharashtra
 in 2010-11.  Besides, the Hosur plant (200,000 MTPA) became fully
 operational during the last financial year, enabling us to market our
 products wider and deeper. The result is that we were a one-factory
 company until 2006-07; we now have five manufacturing locations in four
 states.
 
 The rationale for geographic expansion.
 
 Let us take the Hosur plant. Only 8% of the country''s tube
 manufacturing capacity is based in South India with fragmented
 capacities across manufacturers. Much of the region''s demand is
 addressed through imports from the other zones of the country.
 Inevitably, these imports are costlier by 9-12% on account of higher
 freight and intermediary margins. We strengthened our positioning
 during the last financial year through a stable 80% capacity
 utilisation within the first quarter of commissioning of the Hosur
 plant accompanied by a yield factor of ~98% and high quality that
 translated into large repeat orders.
 
 The rationale behind the acquisition of Lloyd Line Pipes Limited.
 
 The acquisition of Lloyds Line Pipes Ltd (90,000 TPA) will enhance our
 presence in western India (we were already present in the region via a
 warehouse- cum-branch at Pune addressing a ready market of 2,200 MTPA
 per month) and strengthen our export prospects in excess of the
 prevailing 35 countries.  The acquisition enabled us access to
 ready-to-use manufacturing facilities and a new market. The plant will
 reinforce our capabilities comprising API-certified products up to 14”
 tubes.  Besides, the acquisition offers customer franchise, product
 development capability, consolidation, bidding coordination and
 financial synergies.
 
 The Company reinforced its competitive advantage through the following
 initiatives:
 
 - Investment in new technologies leading to the production of
 innovative products.
 
 - Strengthened its distribution network through the addition of five
 warehouse-cum-branches in key cities with plans to extend to Tier-II
 and III cities, rationalising freight, transit time and working capital
 cycle.
 
 - New technologies like rotary sizing mill (RSM) and cold sawing are
 being implemented and will enable to produce new high-end products in
 the coming years.
 
 Enhancing shareholder value.
 
 We are optimistic of the following initiatives: Growing our scale,
 strengthening our product mix, climbing the value chain, increasing the
 retail proportion of our sales and moving into adjacent business
 spaces. These initiatives will enhance our margins and profits,
 providing us with precious accruals for reinvestment, leading to an
 increased organisational value.