Dear Shareholder''s
 
 At a time of global slowdown, higher interest rates, commodity
 uncertainty, currency volatility and a looming eurozone crisis, the big
 question is whether Gravita is adequately prepared.
 
 The answer is that Gravita is competently placed to address the
 challenges of the present and future. This is partly reflected in our
 2011-12 performance: even as most global commodity companies were
 affected by volatility and exchange rate fluctuations, our revenues
 grew 5.83% to Rs268.49 crore, while our PAT increased from Rs14.75 crore
 in 2010-11 to Rs15.04 crore in 2011-12.
 
 A robust business model
 
 Gravita is a one-stop provider of Lead products with a large product
 basket and technological expertise to provide solutions. The Company''s
 niche business composition - smelting and processing, equipment
 manufacturing and trading - translated into business flexibility, with
 an ability to capture every upturn in the sector leading to sustained
 leadership.
 
 During 2011-12, Gravita strengthened its business model through the
 following priorities: focus on efficient conversion, proactive
 initiatives to hedge currency volatility and incremental capacity in
 declining tenures. The result was that even though the business climate
 turned increasingly challenging during the year under review, Gravita
 reported a better- than-industry-average performance with the prospect
 of a vigorous improvement as soon as conditions revive.
 
 Besides, the Company leveraged its longstanding geographic diversity.
 In this business, marketing the end product is not as challenging as
 procuring the raw material to manufacture it in the first place. In
 view of this, the Company selected to be present in regions enjoying a
 relatively abundant access to raw materials on the one hand and a large
 proximate market on the other.  Thereafter, the Company strengthened
 this strategy with the advantage of scale: the result is that the
 Company now has five manufacturing operations outside India. The only
 Indian Lead recycling company with a global presence across six
 continents (Europe, Asia, Australia, Africa, North America and South
 America) for sourcing its raw materials.  Over time, we expect this
 global footprint to leverage logistical advantages, report lower
 production costs and enhance viability across markets, cycles,
 countries and time.
 
 In view of these realities, the Company worked with a plant breakeven
 point of around 250 tonnes per month and an attractive plant payback of
 12 to 18 months, making it possible for us to remain profitable in the
 worst of markets while enhancing our profits during industry rebounds.
 
 Highlights, 2011-12
 
 Despite testing business conditions in during the year, Gravita
 strengthened its prospects through the following initiatives:
 
 - We acquired two partnership firms in J&K for Rs3.21 crore, which
 increased our overall production capacity by 10,800 MTPA
 
 - Commissioned Lead manufacturing facilities in J&K, reaching optimum
 capacity utilisation by the year-end
 
 - Sold the Georgia unit
 
 - Commissioned a world-class plant and machinery fabrication facility
 at Mahindra SEZ (Jaipur), facilitating turnkey project and technology
 solutions
 
 - Acquired the license to import scrap batteries, which will reduce
 our raw material cost around 10% and correspondingly strengthen our
 competitiveness
 
 - Commissioned rotary furnaces and doubled the production of smelted
 Lead production in our Senegal and Mozambique plants
 
 - Acquired Free Zone status in Mozambique which will result in
 benefit of taxes on all Raw-Materials and income giving boost to
 profitability
 
 - Strengthened the manufacturing input-output ratio from 96.5% in the
 past to around 98% through stringent processes and technology use
 
 - Stretched the plants higher than the prevailing industry average of
 40-50%; while the Indian plants reported an average capacity
 utilisation of 43%, the overseas plants reported an average capacity
 utilisation of 50%
 
 Going the eco-friendly way
 
 In line with our environment-friendly commitment, we undertook a number
 of measures to conserve and optimise energy use at our manufacturing
 facilities.
 
 - Replaced conventional burners with Automatic Ignition Oil Fired
 Burner (AFB), which will facilitate better air-flow, improve efficiency
 and reduce fuel consumption.
 
 - Installed Variable Frequency Drive (VFD) for efficient speed
 control of all driving motors. VFD are used for speed control by the
 electronic method, optimising energy needed for motor operation
 
 - Installed APFC for automatically adjusting maximum demand on the
 power supply system, optimising the power factor and reducing reactive
 power requirement
 
 The road ahead
 
 The Company invested during the downturn to possess additional capacity
 to capitalise on the rebound. The main producers of Lead metal are
 China, Australia, the US, Peru, Canada and Mexico. These six countries
 produce three- quarters of the world''s Lead output. In India, about 75%
 of total demand is derived from the domestic battery industry, growing
 at 6-7% per annum and is expected to grow in the years ahead.
 
 India''s annual demand for Lead is nearly 1.60 lakh tonnes which is
 presently addressed through mine production and recycling. At Gravita,
 we foresee an attractive increase in Lead derived from scrap recycling.
 The removal of restrictions levied by the government on scrap imports
 and unorganised recycling players needed to mandatorily install
 pollution equipment will enhance opportunities for organised players
 like Gravita in the secondary Lead manufacturing segment.
 
 Message to stakeholders
 
 At Gravita, we are committed to perform better, backed by our people,
 culture and stakeholders.
 
 We would like to place on record our heartfelt gratitude to our valued
 shareholders and all other partners and associates.
 
 Dr. Mahavir Prasad Agarwal,
 
 Chairman