Instead of converting to grayscale, threshold on the green channel.
Those are very crude letters. It will probably take a pretty sophisticated OCR routine to recognize those. This MATLAB forum does not go into OCR much, except to refer you to the File Exchange or a web search. But you'll have trouble finding any OCR that can recognize those letters. You'd need substantial processing to turn them into something a lot more recognizable, and we just don't get into that kind of complicated algorithm development here. About all I could suggest is to use something like imclose() and bwmorph() to try to morph them into something that looks more like normal letters.
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