The Indian Wood Products Company Ltd

Dear Fellow Shareholders,

FY2022 was just another year full of ups and downs, started with the second wave of COVID-19 in India, and ended on a note of high geopolitical tension and surging inlation.

The Indian economy grew 8.7 per cent in 2021-22, with the gross domestic product (GDP) expanding 4.1% in the March quarter from a year ago. The GDP growth for 2021-22 takes the economy above its pre-pandemic level and is an improvement after contracting 6.6% in 2020-21. But the January-March quarter expansion was the weakest in the previous fiscal year. It is lesser than the 5.4% growth seen during the December quarter of 2021-22. Incidentally, the economic growth during the entire fiscal of 2021-22 has gradually spiralled downwards with each quarter. India has also been witnessing significant inlationary pressures similar to the global economy, including the impact of Russia - Ukraine conlict, quicker tightening of fiinancial conditions with RBI's rate hikes, high oil prices impacting current account balance and fiscal deicit and subsequent Covid-19 outbreaks. However, the Indian economy is well prepared for any challenges that it might face in FY 2022-23.

The FY2022 was an event full year for our Company too. Now, I would like to present to you the operational highlights of FY 2021-22 of the Company.

Katha Division: IWP continued to be the dominant player in India's Katha Industry holding position of marker leader. The last fiinancial year FY2022, due to adverse market scenario, prices of Raw Material increased significantly as against inished goods products i.e. Katha which effects in the profit margins of our Company.

The Catechin extraction unit set up in Indonesia through our Joint Venture Company in Singapore is fully operational and 100% of the Catechin extraction is imported in India and used in the production of the Katha by the Company. Moreover, efforts are being made to debottleneck and increase capacity by minimum 50% in coming quarters.

During the year under review, the Company achieved a sales volume of 3443.88 MT Katha in FY2022 compared to 3210.85 MT in FY 2020 -2021 during the turbulence time. However, the sales of Cutch (byproduct) increased from 802.08 MT in FY2021 to 1236.33 MT in FY2022, thereby registering a growth of 54.14%.

Spice Division: The IWP's Spices is now being the one of the most preferred spices and well recognized by the customers in the markets it operates. Presently, IWP Spices are available in the State of Bihar Uttar Pradesh, Assam, Delhi NCR. The IWP Spice's demand is growing steadely, however, the Company is facing stif competition from the established brands.

Spice Division is growing consistently, however, due to the initial period of brand awareness and with various sales promotion activities, this division is still incurring losses. We are taking appropriate steps to achieve breakeven in the upcoming quarters. The Covid-19 has impacted the growth in the spice segment of the Company.

The operational and fiinancial highlights are:

Achieved sales volume of 3443.88 MT Katha as compared to 3210.85 MT in FY 2021;

Sales of Cutch (by-product) increased from 802.08 MT in FY2021 to 1236.33 MT in FY2022;

Spice Division recorded a turnover of Rs. 1230.29. lakhs in FY2022 as compared to Rs. 1283.46 lakhs in FY2021; We irmly believe that employees are our biggest assets. Their safety and good health have been my top priority during these tough times. We have continued with the safety initiatives placed during the irst wave of the pandemic for the well-being of our people. However, considering the signiicance of the physical presence of employees in our operations, the work from home was discontinued with the relaxation in government rules.

I am hopeful of better operational and fiinancial and operational performance of the Company in FY2023. I would like to thank our employees. We are also grateful to our customers, suppliers,partners, and of course our shareholders for their support.