Dear shareholders,
 
 The world is witnessing an interesting phase of transformation, towards
 an unprecedented realignment.  I had indicated about this phenomenon in
 my last communication to you, and I would like to reiterate that we are
 moving towards a multi-polar world; a new socio-economic dispensation
 in which the emerging economies have a far greater role to play in
 shaping the future than ever before. India is the poster boy of this
 new era, attracting global attention and scrutiny. Twenty years ago,
 the Government of India initiated the intrepid step towards economic
 liberalisation, which eventually transformed India, and that process is
 still continuing.  The economy has averaged 8% GDP growth in the last
 decade and per capita income has shot up from 0 to 00 in two
 decades, accelerating domestic consumption and savings.
 
 The inference: even with modest foreign capital inflows, India can now
 afford an investment rate of 36-38% of GDP, which can sustain 8-9% GDP
 growth in the foreseeable future. Besides, unprecedented economic
 development has enhanced government spending on socio-economic
 infrastructure. There has been another visible advantage: Indian
 businesses, including JSPL have successfully aligned their operations
 and mindset to global benchmarks, and have become multinationals in
 their own right. Something that was rare two decades ago.
 
 Although India, China and Latin America witnessed considerable economic
 activity in 2010-11 the US and Eurozone economies registered sluggish
 recovery.  These economies are now fraught with uncertainties and
 looming recessionary trends. Inflation represents the new global
 economic challenge, leading to a spiralling rise in prices of
 commodities, mineral resources and energy. The global steel industry
 has been impacted by the unprecedented increase in the price of iron
 ore and coking coal. Steel demand in advanced nations has been largely
 stagnant, while Asia enjoyed robust demands with China continuing its
 march at the top of the league.
 
 India''s steel industry has played a major role in driving the country''s
 economic development. Over the decades, India''s ''steelscape'' has also
 evolved, characterised by global acquisitions, adoption of advanced
 technologies and modernisation strategies for cost rationalisation and
 energy efficiency, and finally backward integration into global raw
 material sources. The result is that India today is the world''s fifth
 largest steel producer and is poised to emerge as the second largest by
 2015.  Although modest performance of India''s construction and
 infrastructure sector in 2010, coupled with high input costs, has
 impacted the domestic steel sector, the long-term outlook remains
 robust. Firm international steel prices and strong domestic demand will
 drive domestic steel prices considerably. Besides, the government''s
 estimated infrastructure spending is expected to drive the steel
 demand. The share of the government''s infrastructure spending as a
 percentage of GDP is expected to touch 9% by the end of the 11th Five
 Year Plan.
 
 Although operating in a challenging macro-economic scenario, 2010-11
 has been a busy and fruitful year for JSPL nationally and
 internationally. Domestically, we commenced operations at the wire rod
 mill and bar mill at our Patratu (Jharkhand) plant. Moreover, we have
 considerably enhanced domestic investments for the creation of
 additional capacities and capabilities to emerge as a significant player
 in the steel sector.  Internationally, we are focusing on the
 acquisition of iron ore and coal mines in Australia, Indonesia, South
 American and African countries to ensure raw material security. I am
 also happy to report that the acquired Shadeed Iron & Steel Co. LLC
 (SISCO), a Company incorporated under the laws of the Sultanate of Oman
 in 2010, through our 100% subsidiary Jindal Steel & Power (Mauritius)
 has been commissioned in record time and commercial operations began in
 December 2010, four months ahead of schedule. The Jindal Shadeed plant
 was dedicated to the Nation of the Sultanate of Oman recently, by H.E.
 Sheikh Sa''ad Bin Mohammed bin Said al Mardhouf al Sa''adi, Honourable
 Minister of Commerce and Industry.
 
 Allow me now to share with you our initiatives in South America:
 through our subsidiary Jindal Steel Bolivia S.A (JSB), we have acquired
 the development rights for 20 billion tonne of EL Mutun Iron Ore
 Reserves in Bolivia.  Moreover, there are plans to build a 2.52 MMTPA
 natural-gas-based Midrex Direct Reduction Plant. This new plant will be
 the single largest module till date of any commercial direct reduction
 technology in the world. We also commenced dispatch of iron ore from
 the EL Mutun mines recently. Iron ore from here will be transported
 mainly to China, Middle East, European and South American countries
 through the Parana Paraguay Hidrovia riverway. This will be for the
 first time that iron ore from JSB will be exported.
 
 2010-11 was a financially rewarding year for JSPL, owing to higher steel
 production and sales, diversified product basket and extensive global
 reach. The consolidated income stood at Rs. 13,193.59 crores in
 2010-11, compared with Rs. 11,152.82 crores in 2009-10. EBIDTA
 increased to Rs. 6,398.59 crores in 2010-11 from Rs. 5,907.99 crores in
 2009-10. Profit after tax escalated to Rs. 3,804.01 crores in 2010-11
 from Rs. 3,634.56 crores in 2009-10. Our future strategy would be to
 sustain and improve upon this operational and financial performance,
 while remaining steadfast to deep-rooted values that have nourished the
 organisation since inception.
 
 Energy represents a key input for steel making and the backbone for
 social advancement. We have commissioned a 300 MW (2x150 MW)-phase–I,
 out of 600 MW (4x150 MW) power project at Dongamahua, Chhattisgarh to
 address the additional power requirements. We are setting up captive
 power plants as part of integrated steel plants at Angul (Orissa) and
 Patratu (Jharkhand) for meeting their power requirements. We have also
 forayed into wind energy-- currently operating a 24 MW wind mill in
 Maharashtra-- as a part of our commitment to a carbon-free world.
 Besides, Jindal Power Limited (JPL), a company promoted by JSPL, is
 planning to set up environment-friendly thermal and hydro power
 projects across India.
 
 Despite our business priorities, our social commitment remains
 predominant. During the year under review, we enhanced focus on
 providing healthcare to the underprivileged, impart quality education
 to the children and youth and work towards women empowerment,
 livelihood, livestock care, population stabilisation, drinking water
 and sanitation, youth and sports and infrastructure development. We are
 equally steadfast in our commitment to a cleaner and greener
 environment, and as we go along we will enhance our green quotient in
 terms of acquisition of more environment-friendly technologies,
 encouraging green practices in our plants and host communities globally
 and above all generate awareness about global warming and climate
 change.
 
 Values when actively pursued with deep conviction can generate
 tremendous wellsprings of energy and focus. This is the true spirit of
 JSPL. We believe business excellence is not an isolated enterprise. It
 is the outcome of integrity towards people and community, transparency
 towards stakeholders and an enduring commitment towards sustainable
 development.
 
 Naveen Jindal
 
 Chairman & Managing Director