Business Highlights

• Soda ash business environment worldwide continues to be fluid; domestic demand stable on back of growing detergents and chemicals market
• Debottlenecked capacity at Babrala clocks highest ever urea sales
• Consumer products business continues to grow. I-Shakti sales almost double YOY
• Focused efficiency ADAPT programme delivering results
• The Board of Directors recommended a final dividend of 90% translating in a total outflow of Rs247.62 crore including dividend distribution tax.

FY09 Financial Highlights

• Revenues at Rs12,258 crore up 103 per cent YOY
• Profit from operations increases 80 per cent to Rs1,436 crore
• PAT at Rs648 crore

Q2FY09 Financial Highlights

• Revenues at Rs4,661 crore up 169 per cent YOY
• Profit from operations increases 169 per cent to Rs670 crore
• Profit before exceptional items and tax at Rs587 crore, up 120 per cent

Tata Chemicals Limited, a leading manufacturer of chemicals, fertilisers and food additives today announced it's consolidated & standalone financial results for the quarter ended March 31, 2009. 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.

Commenting on the Company's performance for FY 2009, Mr. R Mukundan, Managing Director said: "This has been a challenging year for businesses all over and our case is not different. In some international markets for soda ash we are seeing some pressure on volumes and prices. I am happy to say that due to a portfolio of businesses which serve a diverse range of customer base spread across agri, household and industrial sectors, we are well placed. Tata Salt delivered record breaking market share in FY09 and our newly launched salt products are already market leaders. Urea sales have been at its highest ever. It has truly been a year of value management. We have in place a focused efficiency program that we believe would enable us respond to challenges in the environment. Going forward Tata Chemicals will continue to create value for shareholders and customers alike."

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

• FY2009 (April 2008 – March 2009) v/s FY2008 (April 2007 – March 2008)
• Income from operations (net of excise) at Rs12,257.66 crore compared to Rs6023.15 crore in FY 2008, an increase of 103 per cent
• Profit from operations at Rs1,436.48 crore higher by 80 per cent compared with Rs796.19 crore in corresponding period last year
• Profit before exceptional items and tax down by 9.5 per cent at Rs1,124.6 crore; as against Rs1,243.51 crore (including Rs487.47 crores on account of profit on sale of long-term investments) in the previous year
• Profit after Tax (PAT) (after Minority Interest) at Rs648.1 crore compared with Rs964.4crore in FY 2008, down by 33 per cent
• Basic EPS : Rs27.59
• Diluted EPS : Rs26.19

Dividend

• The Board of Directors recommended a final dividend of 90 per cent translating in a total outflow of Rs247.62 Crore including dividend distribution tax.

Details of extraordinary items

Foreign exchange - AS-11 amendment

• The Company has exercised the option of AS-11 as per the notification issued by the Ministry of Corporate Affairs on March 31, 2009. Amount amortised for FY 09: Rs125 Cr and amount transferred to the balance sheet Rs360 Cr. To be amortised till March 31st 2011.

Reversal of impairment of cement plant

• Introduction of Masonry cement which utilises fly ash increases opportunity. As a result profits are expected to improve and the company has as a result reversed the impairment of the cement plant.

Balance sheet perspective
Total cash on the balance sheet as on March 31, 2009 amounted to Rs1,452 crore (inclusive of value of fertiliser bonds of Rs446 crore as on March 31, 2009). Operating cash flows have been and are expected to continue to be healthy lending strength to Tata Chemicals' balance sheet and enabling it to support the Company's objective of strengthening its competitive position through a mix of and organic and viable inorganic initiatives as well as efficiency enhancement.

The Company's consolidated gross debt as on March 31, 2009 stood at 6,283 crore. This comprises borrowings of USD 475 million taken on the Tata Chemicals balance sheet and a loan of USD 300 million taken on the GCIP balance sheet, both of which have been taken at extremely fine rates. Payment towards the former will commence in June 2012 while towards the latter has begun in February 2009.

After deducting cash, value of investments and fertilizer bonds as on March 31, 2009, debt stands at Rs4,831crore.

SEGMENTAL PERFORMANCE
Soda ash
Global and Domestic Industry perspective and outlook

• The global soda ash industry is presently operating at approximately 75 per cent capacity utilisation in line with demand. Prices are currently in the range of USD 160-175 FOB China
• The Government of India has imposed a 20 per cent safeguard duty for a six month period to protect the soda ash industry from Chinese dumping
• The Chinese government has also reintroduced a 9 per cent export incentive for producers leading to increased production in China
• While demand in the UK continues to be encouraging, the rest of Europe is witnessing a decline
• US demand looks to be stabilising; however there are some challenges being witnessed in Latin America which accounts for a considerable portion of GCIP exports
• Domestic soda ash demand continues to be healthy mainly on the back of traction of the detergents and chemicals segments
• Consolidated sales amounted to Rs5,415 crore for the quarter ended March 31, 2009; PBIT margins for the chemicals business stood at 18.6 per cent for the quarter

Mithapur, India

• 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 31March 2009 stood at 695 thousand tonnes.

Brunner Mond Group Limited

• Higher volumes, price increases that effective during three quarters of the year and lower overheads enabled improved performance of BMGL
• However there is some volume shrinkage now being witnessed and capacity utilisations are being seen to normalise at approximately 70 per cent. Rapid increase in production seems unlikely in the near future
• Prices in Europe are presently in the region of USD 240 pmt.
• Increased imports from China into South East Asia has considerably impacted Magadi's performance

GCIP

• While US domestic demand appears to have stabilised, increased Chinese imports into Latin America combined with weaker demand in the region is impacting exports of the Company
• GCIP has begun a focused cost reduction and cash generation programme to help keep costs under control

Consumer Products

• Tata Chemicals remains market leader with 58.4% market share in the national branded segment ¡V its highest ever.
• Tata Salt's continues at number one position with market share of about 44 per cent
• I-shakti sales double YOY
• Tata Salt Lite has become the market leader in the low sodium salt category within the first year of its launch

CROP NUTRITION BUSINESS (formerly Fertilisers Business)

• Sales for Q4FY09 from the crop nutrition business were Rs6,912 crore
• PBIT margins stood at 7.3 per cent
• Urea production at the Babrala plant has stabilized at over 3,500 tpd levels
• The quarter under review saw the highest ever urea sales on the back of improved availability after debottlenecking the plant
• While DAP consumption in India saw its highest levels ever, prices have corrected over this quarter impacting margins
• Continuing high phosphoric acid prices may render manufacture of DAP unviable

Details of subsidy received & outstanding

• Total subsidy received in FY 2009 – Rs4,264 crore
• Cash subsidy received in FY 2009 – Rs3,245 crore
• Bonds subsidy received in FY 2009 – Rs1,019 crore
• Total subsidy outstanding as on 31 March 2009 – Rs874 crore

IMACID
IMACID resumed operations in the quarter under review
Inventory writedowns to current realizable values impacted EBITDA

D. NEW BUSINESSES
Fresh Produce
Operations in Ludhiana stabilising
During the quarter the business focussed on cutting costs and improving margins by reaching higher volumes

Bio-fuels
Feedstock for the 30 KL/day Ethanol plant is being sourced and production is expected to begin soon
Trial cultivations of Jatropha for the Biodiesel operations continue smoothly

ADAPT
The Company has adopted this programme to combat the extremely challenging prevalent macroeconomic environment. Under the three heads below, ADAPT is carrying out the following actions –
Capex Postponement
Focus on Critical, Safety and maintenance Capex; All non critical and non routine capex being deferred
Cash Conservation
Working Capital management; Cash conversion efficiency; Locking in energy costs, royalty
payments; Taking price increases wherever possible; Stringent monitoring of ARs and APs
Cost Reduction
Reducing wastage; Focus on supply chain efficiencies; Leveraging Scale; Deleveraging, Selling
Non Core Assets; Review of raw material contracts; Paring overheads

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.