Gurgaon, 21 January 2002

Overview

ICI India's restructuring plan made good progress. The Company acquired Hindustan Lever's Catalyst business (edible oils and oleochemicals applications) for Rs 21 cr on 10 Dec 2001 and its adhesives business for Rs 9 cr on 28 Dec 2001. Both acquisitions are a perfect fit with ICI India's strategy of aggressively growing its core businesses.

As reported earlier, the Polyurethanes business has been sold effective 1 April 2001 and the Motors and Industrial Paints Business has been hived off effective 1 May 2001.

The financial results of the quarter and nine months ended 31 Dec 2001 are therefore not directly comparable with those of the previous year.

Financial Results

ICI India's total income for the Quarter at Rs 193 cr, reflects a 6% growth in the sales of continuing businesses over previous year's quarter. The operating profit for the quarter at Rs 23.24 cr was higher than the previous year by 26% due to a significant improvement in the performance across businesses. Consequently, profit after tax during the quarter at Rs 10.31 cr was higher than the previous year by 35%. Operating profit/sales ratio improved from 8.5% to 12% reflecting the progress of business restructuring and improved operations.

For the nine months ended 31 Dec 2001, comparable sales were up by 6% and operating profit grew by 15%. However, profit after tax was lower by 11% compared to previous year due to higher exceptional income during the last year.

Business Segments

Decorative paints registered growth over the previous year with the Dulux brand getting a good response from the customers. The new Dulux Supreme 3-in-1 is now available across the country. 2K continued to power the growth of the refinish business. The business continued to invest aggressively in market development and registered profitable growth over previous year.

Industrial Specialties sales grew 20% over previous year on the back of strong growth in agricultural surfactants, spin finishes, polymer additives and adhesives. Operating profit growth was impressive at 31% over previous year.

The Industrial Chemicals group sales were lower by 5% than the previous year primarily due to the downturn in the truck-tyre industry (affecting Rubber Chemicals Business) and difficult trading conditions post the 11 Sep 2001 events. Operating profit, however, registered a strong growth of 22% reflecting the benefits of restructuring, improved product margins and growth in exports.

Pharmaceuticals grew 5% over previous year. Operating profits declined 8% reflecting margin compression following increased competition in the critical care and cardiovascular segments.

For further information:

R Guha
Tel: +91 124 2540810
Fax: +91 124 2540839
E mail: r_guha@ici.com