LETTER TO SHAREHOLDERS
 
 A YEAR OF SUSTAINED MOMENTUM
 
 It is my pleasure to be writing to you again on the performance of the
 last year and update you on the outlook for the year ahead. The last
 financial year was a year of consolidation and one of sustained
 investments as far as our foray into agriculture is concerned. We
 continued our leadership position in the floriculture, retail and food
 processing business.
 
 Overall, it has been a satisfying year for your Company and we hope
 that the investments made into the Company in the current fiscal will
 translate to accelerated growth overa period of time.
 
 OPERATIONAL HIGHLIGHTS
 
 AGRICULTURE:
 
 Agriculture continues to be the thrust of your Company and as
 communicated to you in the earlier communiques, we have made
 substantial progress at the project implementation sites at Bako and
 Gambella in Ethiopia. We have in the first phase commenced our
 operations on 110,000 ha of land. The Company has cleared and developed
 over 50,000 Ha of land out of which 20,000 Ha of land is ready for
 sowing of cereal crops and additional 10,000 Ha is being made ready.
 As I write this we have 12000 ha planted with Maize and Rice and we
 expect to get our 1st big harvest in September/October this year. We
 are currently concentrating on cultivating paddy and maize in the area
 so described above. In Gambella, a nursery was established for Palm,
 which currently has V2 million Palm plants ready for transplanting on
 4,000 Ha of land with each hectare of palm plantation having a
 potential of yielding 4,000 Kgs of crude oil.  We have also started the
 Sugarcane Nursery on 100 Ha of land and expect to keep growing it and
 have sugarcane available for processing by 2nd half of 2013.
 
 Given the size and scale of our operations, we did face some delay with
 respect to getting equipment on site on time due to logistic overheads,
 local clearances.  However despite the delays, we have seen
 considerable amount of progress in development of the land &
 Infrastructure and we are now ready to harvest our first major crop
 later this year.
 
 The Company has taken proactive steps to ensure that the complete
 ecosystem required for development of the land parcel is in place as we
 move forward. To this effect, we have taken on board various experts
 from fields like Oil Palm, Irrigation and Water Management, Cotton,
 Rice and Sugarcane to help us with our efforts.  Further, we have also
 enlisted the support of several farmers from Punjab in India to lend
 their expertise to the process of growing crops in Ethiopia through the
 latest technology. Plans are also afoot to set up joint ventures for
 agro-processing plants near the farming area. This includes amongst
 others rice milling units, sugar mill and oil extraction units.
 
 We believe that our efforts at producing over half a million tons of
 cereals and 100,000 tonnes of oil palm will significantly alter the
 demand situation in favor of the African consumer.
 
 FLORICULTURE:
 
 As far as floriculture is concerned, we have reached an almost steady
 state with about 9% of the market share of the European cut rose
 industry. We are planning to bring another 25 Ha under production this
 year at Walliso in Ethiopia. During the year, we saw good visibility
 for cut roses with a bumper Valentine day and Mother''s day demand from
 our major markets.
 
 On the domestic front, we also reached an understanding to pick up 54%
 stake in Mumbai based Florista which has a chain of floral designing
 boutique stores spread across India. Florista specializes in designing
 exquisite flower arrangements and decorations made from exotic flowers
 imported from across the world. Florista currently has more than 15
 retail boutique stores in India and also has a strong network to
 deliver flowers anywhere in the world through its online portal. By
 acquiring majority stake in Florista, Karuturi''s retail presence in
 India is further consolidated. Karuturi Global has merged its retail
 operations carried out under the brand name Flower Xpress with
 Florista, so now its entire retail operations is under one umbrella. We
 are going international with our 1st outlet outside India opening at
 Bhutan this month.
 
 OTHER BUSINESSES:
 
 Karuturi Foods Pvt. Ltd. (KFPL) a 100% subsidiary of Karuturi Global
 Limited has seen the markets recovering this year. We are working on to
 increase our processing capacity to capture newer markets. The company
 has got the LOA for 1500 acres of farmland from the government of
 Karnataka for a long term lease to grow vegetables for its captive
 consumption.  This farmland will also be utilized for growing seasonal
 vegetables to sell in the Bangalore and surrounding markets. There is a
 great potential to venture into fresh vegetable retailing in the days
 to come due to excessive price increase in last two years for the fresh
 vegetables in the domestic market.
 
 FINANCIAL PERFORMANCE:
 
 For the year under review, the Company posted a total income of Rs.
 645.2 crore; an increase of about 18% over the last fiscal. Our Net
 profit after tax is Rs. 154.97 crores and EBITDA in FY 2011 is 38%. The
 margins were sustained primarily due to consistent margins from our
 flower business.
 
 CORPORATE SOCIAL RESPONSIBILITY:
 
 We have always been socially responsible as a corporation and have
 placed immense importance on sustainable development in a manner that
 our environment around us is not affected in anyway. We have focused on
 many programs on environment, education and safety in all the
 geographies we operate in. This has been supplemented with partnerships
 with non- governmental organizations in the communities where we have a
 major presence. We continue to get various awards for our efforts. We
 have been nominated for the Global Business Council Awards for
 leadership in the workplace category for initiatives in healthcare.
 
 DRIVING AFRICAN INTEREST:
 
 We have been actively driving issues related to Agriculture and Trade
 in the Eastern Africa in the recent past. The Company has been at the
 forefront of action during the 2nd India Africa Forum Summit held in
 Addis Ababa, Ethiopia in May 201 1 .Tanzania India Friendship
 Association(TIFA) Symposium in June 201 land FICCI''s agri-business
 delegation to Tanzania, Uganda, Ethiopia during August 2011 and also in
 world economic forums.
 
 BUSINESS OUTLOOK:
 
 We believe that we have put in place the building block for success in
 terms of our investments into Ethiopia and Kenya on both the
 agriculture and floriculture fronts.  This has been further
 supplemented by the latest technological innovations being used at the
 sites, a good marketing and supply chain for efficient distribution of
 our products and most importantly a motivated and hard working team
 that is one of the key reasons for our success to date.
 
 I would like to place my heartfelt thanks to the stakeholders who
 continue to be invested in us, the customers who are the primary reason
 for our existence and most importantly my fellow employees who have
 been a part of this great success story called Karuturi.
 
 Yours sincerely,
 
 Sai Ramakrishna Karuturi 
 
 Managing Director