Dear Shareholders,
 
 The fiscal year that has just ended has been positive and encouraging
 for ISMT, a clear sign that we are on the right and intended path. Net
 sales increased by 36%, Tube sales increased by 24%, Steel sales
 increased by 31%, exports increased by 87%, and EBITDA increased by 28%
 as compared to the previous year.
 
 Indeed, this is the inflection point that we were looking for a steep
 increase in sales after many years of level growth. As I mentioned last
 year, and I would like to reiterate now, this is the start of a
 transition from being a niche producer of specialized seamless tubes
 and alloy steels to becoming a global leader in these products; In
 other words, the unfolding of our ''Vision'' to be the most sought after,
 efficient, profitable and respected producer globally of precision
 seamless tubes and alloy steels.
 
 Undoubtedly, a key driver for this change has been the commissioning of
 the PQF Mill that is now shown some improved performance. We now have
 the largest tube making capacity in the country and we are leveraging
 this advantage to secure an unshakeable market position for ourselves
 in key sectors of the economy.
 
 During the last year we have been making efforts towards bringing the
 PQF Mill on stream by reducing some of the issues that we have had with
 this Mill in terms of product quality and productivity, and creating a
 market for some of the new products that can be produced by the PQF
 Mill.
 
 During the current year our focus will be to reduce production costs.
 While sales volumes will no doubt increase as a result of the marketing
 efforts that have gone in during the preceding years, we will now seek
 to optimize the production processes in the PQF Mill and drive down the
 costs of our core products. We expect that these efforts will begin to
 bear fruit by way of increased operating margins during the current
 year. The combination of these elements will make our business model
 very robust and create a secure foundation for future growth.
 
 In addition to the above, we have launched various other initiatives
 and business process changes to make our Company more responsive and
 agile. We have a very active marketing team that is constantly looking
 for new markets by geography as well as by product segments. We have
 tightened various business processes so that we can adjust prices very
 quickly in response to changes in input prices. We have also put in
 place an improved planning process that aims to reduce delivery lead
 times while simultaneously reducing inventory and WIP at all stages.
 
 This year a specific focus area for the Company is on improving
 delivery timelines and on improving quality. Our management attention
 is now directed towards developing very strong embedded customer
 relationships with ''market leaders'' in each of our target markets and
 ensuring that they are completely satisfied. With the tremendous growth
 in certain sectors we believe that associating with such companies will
 create a firm basis for sustained future growth. We have already made
 some significant headway in this direction and will continue the
 development further.
 
 As part of our firmly entrenched corporate philosophy we continue to be
 focused on new product development. Like in the previous years we are
 working on launching several new products, tubes as well as steel, for
 the Powergen, Mining and Automotive markets.
 
 The overall market situation today is not very different as compared to
 this time last year. The key dynamic in the seamless tube market today
 is the overcapacity in China, the consequent price cutting by Chinese
 enterprises, and the anti-dumping duty on Chinese tubes in the
 European, U.S., and Canadian markets. This scenario is contrasted by
 the fact that as yet there is no anti-dumping duty imposed by the
 Indian Government.
 
 Faced with mounting duties in the developed markets China is dumping
 seamless tubes in the remaining parts of the world including the Middle
 East, North Africa, South-East, and India with extreme aggression.
 Selling seamless tubes in these regions is extremely difficult. On the
 other hand, demand for Indian tubes has increased in countries like the
 U.S., and Europe, where anti-dumping duty has been levied on Chinese
 products.
 
 Last year our application for anti-dumping duty had been turned down by
 the Indian Government on a technicality. We are now making a new
 application supported by fresh evidence of Chinese anti- dumping
 behavior, and we are hopeful of securing a positive response from our
 Government.
 
 Regardless, as a means to hedge ourselves against these uncertainties
 in the market, we are vigorously focusing on increasing our exports to
 the U.S., Europe, and other regions where duty has been imposed on
 Chinese products. We are also increasing our market share in more
 sophisticated product segments where Chinese competition is more muted.
 Fortunately for us these specialized product segments, namely,
 construction, Powergen, and mining are all growing rapidly in India.
 
 During current year our 40MW captive power-plant will come on stream.
 Combined with the other cost cutting activities that I mentioned
 earlier the power cost savings that will accrue from the operations of
 this plant will further strengthen the financial structure of our
 operations.
 
 In summary, I believe we are taking all the necessary steps to create
 and secure a firm foundation for our Company. We are moving in the
 right direction and I look forward to our shared future with optimism.
 
 I would like to take this opportunity to express my gratitude to our
 customers, banks, and business associates, for their continued support
 and for the trust they have reposed in us.
 
 Thank you
 
 
 
 Salil Taneja
 
 Pune, August 29, 2011