Samtel Color Ltd.

SAMTEL COLOR LIMITED ANNUAL REPORT 2010-2011 CHAIRMAN'S REPORT Dear Shareholders, The external environment continues to pose challenges for us. Despite reasonably good demand in Latin America, South Africa and South Asia, the downward trend in the global market for color picture tube based televisions persisted this year as well. The demand for the year 2010 was around 62 Million sets as compared to 65 Million sets in 2009. It is expected to fall further to 55 Million in 2011. Closer home, in India, the market for CPT based Television sets, including the demand for a State sponsored scheme in the year 2010, was 18.5 Million, a decline of approximately 0.70 Million as compared to 19.2 Million of 2009. The State sponsored scheme of free color television has since been discontinued/closed. The domestic demand for CPT based Televisions in the coming years is expected to remain at around 13 to 14 Million per annum. The industry estimates the demand to decline at the rate of 2 to 3% per annum over the next two years. These factors, coupled with the surge in imports of CPTs from South East Asia, which is still going on unabated despite the Anti-dumping duty, have impacted our sales volumes and selling prices adversely. Your Company produced 7.65 million CPTs in the year under review, compared to 9.21 million last year thus registering a decline of approx. 17%. The Cash Profit (PBDT) in the year 2010-11 fell to Rs. 10.16 crores from Rs. 75.49 crores in the last year. The Company is taking steps towards restructuring its manufacturing operations, which will increase efficiencies, rationalize manpower and will help towards reducing costs. Research and development to produce low cost variants of medium and small size slim color picture tubes is also a continual process at your Company. In conclusion, I would like to add that we value the faith and unwavering commitment vested in the Company by all of you. I hope that your support for the Company will continue in the coming years as well. With Best Regards SATISH K. KAURA Chairman & Managing Director