Business Highlights

• Global spread of operations, improved realisations and healthy demand in both industry sectors enable strong overall growth despite a hostile environment
• All business units in India and overseas perform well
• Soda ash prices continue to be firm. Slowdown in US volumes being picked up by Latin America
• Magadi production has improved substantially in Q2 and capacity utilisation continues to improve. Haldia achieves record production during Q2
• New fertiliser policy to attract investments in the sector
• Urea plant debottlenecking project nearing completion
• Tata Chemicals' salt market share highest ever at 56 per cent; I-shakti is India's third largest salt brand
• Construction of ethanol pilot plant at Nanded almost complete

H1FY09 Financial Highlights

• Revenues at Rs 6,853 crore up 139 per cent YOY
• Profit from operations increases 150 per cent to Rs 1,077 crore
• Profit before exceptional items and tax at Rs 939 crore, up 116 per cent
• Cash profit up 87 per cent at Rs. 823 crore

Q2FY09 Financial Highlight

• Revenues at Rs 4,661 crore up 169 per cent YOY
• Profit from operations increases 169 per cent to Rs 670 crore
• Profit before exceptional items and tax at Rs 587 crore, up 120 per cent

Tata Chemicals Limited, a leading manufacturer of chemicals, fertilisers and food additives today announced its consolidated and standalone financial results for the quarter ended September 30, 2008. The company is the second largest manufacturer of soda ash and the third largest producer of 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.

Managing Director, Homi Khusrokhan, described the performance of Tata Chemicals for the quarter and the first half of this year as exceptionally good.

"I am delighted to be able to report very strong performance from Tata Chemicals, despite the difficult business environment and the unprecedented volatility of recent times. What has been particularly satisfying is that all our business operations and companies around the world, without exception, have performed well during the period under review and we continue to remain cautiously optimistic about the future.

Soda ash prices continue to be firm in the US and Europe and the wide geographical spread of our business will be of considerable advantage going forward. The fertiliser business has also performed strongly and recent changes in government policy for market linkage of fertiliser prices will encourage fresh investment. The debottlenecking of our urea plant at Babrala, which continues to be one of the most energy-efficient units in the world, is proceeding on schedule and will be completed within the current quarter.

There will of course be challenges and difficult times ahead during the second half of the year, but we have started the year well and managing adversity has always been one of the company's greatest strengths"

Note:
Consolidated financials indicated in this communication are reviewed and primarily include those of Tata Chemicals standalone entity, the Brunner Mond Group acquired in December 2005, the one third stake acquisition in Indo Maroc Phosphore S.A. (IMACID) and the acquisition of General Chemicals and Industrial Products acquired in March 2008.

YEAR – ON – YEAR CONSOLIDATED PERFORMANCE COMPARISION

H1 FY2009 (April – September 2008) v/s H1 FY2008 (April – September 2007)

• Income from operations (net of excise) at Rs 6,853 crore compared to Rs 2,863 crore in H1 FY 2008, an increase of 139 per cent.
• Profit from operations at Rs 1,077 crore higher by 150 per cent compared with Rs 431 crore in corresponding period last year
• Profit before exceptional items and tax up by 116 per cent at Rs 939 crore; as against Rs 434 crore last year
• Profit after tax (PAT) at Rs 385 crore compared with Rs 346 crore in H1 FY 2008, up 11 per cent
• Basic EPS (not annualised): Rs 16.40
• Diluted EPS (not annualised): Rs 16.33

Q2 FY2009 (July – September 2008) v/s Q2 FY2008 (July – September 2007)

• Income from operations (net of excise) at Rs 4,661 crore compared to Rs 1,733 crore in Q2 FY 2008, an increase of 169 per cent
• Profit from operations at Rs 670 crore higher by 169 per cent compared with Rs 249 crore in corresponding quarter last year
• Profit before exceptional items and tax was up by 120 per cent at Rs 587 crore; as against Rs 267 crore last year
• Profit after tax (PAT) at Rs 278 crore compared with Rs 208 crore in Q2 FY 2008, up 34 per cent
• Basic EPS (not annualised): Rs 11.82
• Diluted EPS (not annualised): Rs 11.7

SEGMENTAL PERFORMANCE

A. CHEMICALS

• Domestic sales amounted to Rs 558 crore for the quarter ended September 30, 2008 and PBIT margins for the chemicals business stood at 23 per cent for the quarter

Soda ash

Performance perspective

• Tata Chemicals maintained its leadership position in the domestic soda ash market
• Sales volumes (including exports) for soda ash at Mithapur for the quarter ended 30 September 2008 stood at 176,000 tonnes, which is 25 per cent better than Q2FY08.

Industry perspective and outlook

• Soda ash prices globally have remained firm, particularly in the US and Europe. A significant part of the business in these countries is transacted in terms of annual contracts
• Cost of input like coal, coke etc though have declined
• Surplus Chinese enhanced production may put pressure on prices in Africa and Asia but cost of production are also reducing because of lower energy costs
• Lower demand in the US is being picked up by Latin American markets

Consumer Products

• Tata Chemicals' market leadership in the domestic edible salt market rose to an all time high of 56 per cent in the national branded segment.
• Tata Salt's current market share is at 42.4 per cent. I-shakti is now the third largest salt brand in India with a national branded market share of 13.5 per cent.

B. CROP NUTRITION BUSINESS (formerly Fertilisers Business)

• Revenues for Q2FY09 from the crop nutrition business were Rs 3,067 crore
• PBIT margins stood at 13 per cent
• Work on debottlenecking of the urea plant at Babrala is progressing on schedule.

C. FOREIGN SUBSIDIARIES AND JOINT VENTURES OVERVIEW

BMGL

• Magadi Soda Company increased its prices by USD 40-50 per tonne effective 1 August 2008 to combat rising fuel and overhead costs
• BM Netherlands also took a mid-contract price increase effective 1 August 2008 which partly neutralised rising costs

GCIP

• GCIP produced 1.18 million tonnes of soda ash in H1FY09. Sales for the period amounted to 1.15 million tonnes
• Although the US markets shrunk in Q2, realisations from foreign markets – specially Latin America – have enabled GCIP's performance to remain buoyant

D. NEW BUSINESSES

Fresh Produce Business

• The first collection cum distribution centre at Melerkotla, near Ludhiana is functional.

Bio-fuels Business

• Construction of the Ethanol plant at Nanded is almost complete and trial production is expected to begin soon

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

Gavin Desa/ Ravi Narain
Citigate Dewe Rogerson
Tel.: +91 22 4007 5037 / 5039
Mobile: +91 22 2284 4561
E-mail: gavin&at;cdr-india&stop;com, ravi&at;cdr-india&stop;com

Some of the statements in this document that are not historical facts are forward looking statements. These statements are based on the present business environment and regulatory framework. We assume no responsibility for any action taken based on the said information, or to update the same as circumstances change.