Gurgaon, 22 May 2002

OVERVIEW

During the year, ICI India made significant progress towards reshaping its portfolio. Substantial investments were made in growing the core businesses of Paints, Quest, National Starch and Performance specialties. It invested approx. Rs 180 cr in acquiring a majority stake in Quest International India Limited, buying out Hindustan Lever's catalyst and adhesives businesses and made substantial marketing investments in the Paints business. In addition, the Company also sold its Polyurethanes, Industrial Paints and Pharmaceuticals businesses to divest from non-core businesses.

Financial Results for the Quarter and twelve months ended 31 Mar 02 are, therefore, not comparable to the previous year.

FINANCIAL RESULTS

Quarter January - March 2002

ICI India's sales for the quarter at Rs 154 cr, from continuing businesses, were higher than the previous year by 11%. Operating Profit for the continuing businesses at Rs 18.4 cr was lower by 9% compared to previous year mainly due to significantly higher market development expenditure in the Paints business.

Exceptional items during the quarter contributed to an income of Rs 60.3 cr, primarily comprising profit on the sale of the Pharmaceuticals business, property sales, earn out from Polyurethanes sale, net of restructuring costs, VRS and provision for additional liability in respect of employees' retirement benefits, necessitated by fall in interest rates. Consequently, profit after tax for the quarter at Rs 55.4 cr was 35% higher compared to previous year.

Fiscal year 2001-02

For the year, sales from continuing business grew 7%, whereas operating profit from these businesses grew by a healthy 17% over previous year. With higher exceptional income and strong business performance, the fiscal year ended with a record PBT of Rs 107.2 cr and PAT of Rs 80.5cr.

Taking into account the high level of exceptional income during the year, as a special case, the Board of ICI India recommended a dividend of 100% (Rs 10.00 per share), against the previous year's payout of 55% (Rs 5.50 per share).

BUSINESS SEGMENTS

Paints

Paints grew by 9% during the quarter. In Decorative Paints, the premium brands grew ahead of the market supported by aggressive market development efforts. Refinish paints continued to perform strongly, maintaining its market leadership in 2K paint.

Industrial Specialties

Industrial Specialties continued to perform strongly, registering 37% growth in sales during the quarter compared to previous year. Overall for the year, sales grew 25% and operating profit 29% over previous year.

Industrial Chemicals

Industrial Chemicals group sales for the quarter grew 4% over previous year. For the year, sales were up 3% and operating profit 27% on the back of the turnaround of Rubber Chemicals, and continued robust performance from Nitrocellulose and Synetix businesses.

For further information:

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