• Strong soda ash and salt demand improves realisations
• Debottlenecking of Babrala fertiliser facility commences
• Forex gains and efficient operations improves profitability
• Revenues impacted by planned annual maintenance shutdown & power outages
  

Q1 FY08 Financial Highlights

• Consolidated (including overseas subsidiaries)
• PAT at Rs 137 crore up 55 per cent YOY
• Revenues at Rs 1134 crore
• Basic EPS: Rs 6.39, Diluted EPS: Rs 4.78

Standalone

• PAT at Rs 121 crore - up by 61 per cent over Q1FY07
• Revenues at Rs 669 crore; Profit from Operations at 163 crore
• Basic EPS Rs 5.63, Diluted EPS: Rs 4.11

Tata Chemicals Limited, a leading manufacturer of chemicals, fertilisers and food additives today announced its audited financial results for the quarter ended June 30, 2007. The Company is the third largest manufacturer of soda ash and sodium bicarbonate in the world, apart from being the leader in the Indian market. Tata Chemicals also enjoys leadership in the Indian edible salt market and is the most efficient manufacturer of urea fertiliser in the country.

Commenting on the Company's performance for Q1FY2008, Homi Khusrokhan, Managing Director, Tata Chemicals, said, "Strong soda ash demand has enabled us mitigate rising input costs through better realisations. Tata Salt sale have been encouraging. While production was low on account of planned maintenance and power outages, profit from operations was marginally better because of better efficiencies at all sites. The opportunities offered by our new business ventures namely Khet-se Agri Produce (our recent entry into Fresh Produce) and bio fuels make us very confident and excited about the future of Tata Chemicals."

Note:
Consolidated financials indicated in this communication are audited and primarily include those of the Brunner Mond Group acquired in December 2005 and the one third stake acquisition in Indo Maroc Phosphore S.A. (IMACID)

PERFORMANCE SUMMARY

CONSOLIDATED:

• Q1 FY2008 (Apr - June 2007) v/s Q1 FY2007 (Apr - Jun 2006) (all figures consolidated)
• Income from operations (net of excise) at Rs. 1,134 crore compared Rs. 1,211 crore last year
• Profit from Operations up 16 per cent at Rs. 260 crore; compared to Rs. 224 crore last year.
• PBT amounted to Rs. 196 crore, up 52 per cent in Q1 FY2008 compared to Rs. 129 crore in the same quarter last year
• PAT increased 54 per cent to Rs. 137 crore compared with Rs. 89 crore in Q1 FY2007
• Basic EPS (not annualised): Rs. 6.39
• Diluted EPS (not annualised): Rs. 4.78

STANDALONE:

Q1 FY2008 (Apr - June 2007) v/s Q1 FY2007 (Apr - Jun 2006)

• Income from operations (net of excise) at Rs. 669 crore compared Rs. 755 crore last year
• Profit from Operations up 3 per cent at Rs. 163 crore; compared to Rs. 159 crore last year.
• PBT amounted to Rs. 176 crore, up 59 per cent in Q1 FY2008 compared to Rs. 110 crore in Q1 FY2007
• Strengthening of the Indian rupee has resulted in reduction of foreign exchange liabilities
• PAT increased 61 per cent to Rs. 121 crore compared with Rs. 75 crore in Q1 FY2007
• Basic EPS (not annualised): Rs. 5.63
• Diluted EPS (not annualised): Rs. 4.11

SEGMENTAL PERFORMANCE

A. CHEMICALS

• Domestic sales were at Rs 353 crore while PBIT was Rs 91 crore. Q1FY08 PBIT margins for the chemicals business stood at 26 per cent
• Prices of Soda Ash, salt and sodium bicarbonate were firm resulting in improved realisations. The removal of export benefits in China is expected to see continued firm soda ash prices
• Raw material prices are however on the rise. In an effort to combat this, the Company is endeavouring to enter into long term contracts for key inputs like coal, coke sulphur and ocean freight

Soda ash

Performance perspective

• Tata Chemicals maintained its leadership position in the domestic soda ash market with an overall domestic market share of 30 per cent
• Sales volumes (including exports) for soda ash for the quarter ended June 2007 stood at 164,155 MT and exports were at 26,362 MT up 56 per cent
• Soda ash prices were increased by around 5 per cent during the quarter partly also mitigate rising input costs and rising ocean freight
• Production during Q1FY08 was impacted due to lower steam availability

Industry perspective and outlook

• Soda ash demand has remained firm globally which has led to a price hike globally. Contracted prices last quarter stood at - USD 200/tonne while current spot prices have risen to -USD 230-240/tonne.

Food additives

• Tata Chemicals maintained its leadership position in the domestic edible salt market with a higher market share of 49.2 per cent in the national branded segment (May 2007)
• Sales have registered a growth of 5 per cent over the same period last year
• The I-shakti brand of salt is steadily enjoying increasing acceptance in the South

B. FERTILISERS

• Q1FY08 revenues from the fertiliser business were Rs. 316 crore. PBIT margin for the quarter was 17 per cent.
• Global fertiliser prices continue to be at high levels

Nitrogenous (Urea)

• Urea production has been lower this quarter due to a planned maintenance shutdown taken during the quarter
• Having received permission from the Government, the Company has commenced the first phase of debottlenecking the Babrala facility

Phosphatics (NPK, DAP)

• Higher value NPK fertilisers continued to comprise a greater proportion of phosphatic fertiliser sales
• International DAP prices continue to be at all time high levels at - USD 450 per tonne and are expected to continue being at these levels for the next few quarters due to heavy demand in the Americas (US & Brazil)

C. FOREIGN SUBSIDIARIES AND JOINT VENTURES OVERVIEW

• Performance of BMGL has been strong on the back of strong soda ash prices and higher than normal production
• IMACID's results have been healthy mainly due to favourable international prices of phosphoric acid

D. NEW BUSINESSES

• Fresh Produce Business
• The fresh produce business (Khet-Se) setup continues as marketing plans are being drawn up and field staff recruitment is progressing as scheduled
• Innovation Centre
• A management team is being recruited for the Innovation Centre and opportunities of commercialisation are also being evaluated.

E. FINANCIAL MANAGEMENT

• Total consolidated debt as on June 30, 2007 stood at Rs 1658 crore. Debt largely comprises low cost short term buyer's credit for the phosphatics business and the Foreign Currency Commercial borrowing raised in January 2005

About Tata Chemicals Limited
Established in 1939, Tata Chemicals Limited is India's leading manufacturer of inorganic chemicals, fertilisers and food additives. Part of the US$ 22 billion Tata Group, the company owns and operates the largest and most integrated inorganic chemicals complex in the country at Mithapur, Gujarat. The company's state-of-the-art fertiliser complex at Babrala, Uttar Pradesh, is known for its world-class energy efficiency standards, and has won several awards in the fields of environmental conservation, community development and safety. TCL's phosphatic fertiliser complex at Haldia in West Bengal is currently the only manufacturing unit for DAP/NPK complexes in West Bengal. In 2005 the company made several international footprints mainly in Europe and Africa with the acquisition of 33 per cent share in Indo Maroc Phosphore (IMACID) of Morocco and 100 per cent buyout of the Brunner Mond Group which has production facilities in the UK, Netherlands and Kenya along with port facilities in South Africa. Brunner Mond also has a captive natural soda ash reserve in Lake Magadi (Kenya), the acquisition of which has placed Tata Chemicals as the 3rd largest producer of soda ash in the world.

For further information contact
P.K.Ghose
Tata Chemicals Ltd
Tel.: +91 22 6665 8282
Fax: +91 22 2285 1132
Email: pkghose&at;tatachemicals&stop;com

Gavin Desa
Citigate Dewe Rogerson
Tel.: +91 22 4007 5037
Fax: +91 22 2284 4561
Email: gavin&at;cdr-india&stop;com