Audited financial results of EID Parry (India) Limited for the quarter ended March 31, 2007

Chennai, 4 May 2007: The income from operations of E.I.D. Parry (India) Limited for the quarter ended 31st March 2007 was Rs.76.90 crore (Rs.354.37 crore). The Gross Profit for the quarter was at Rs.4.23 crore (Rs.56.52 crore). After absorbing depreciation of Rs.8.78 crore (Rs.6.79 crore) there was a loss of Rs.3.46 crore before taxation (Rs.48.81 crore profit).The net loss for the quarter ended 31st March 2007 stood at Rs.10.72 crore (net profit of Rs.43.68 crore) after adjusting tax of Rs. 7.26 crore, (Rs.5.13 crore). The loss is due to the selling price of sugar being lower than the cost of production.

Government of India followed by Maharashtra, Karnataka and Andhra Pradesh announced support measures to facilitate removal of surplus sugar stocks through buffer stocks and exports. Sugar Industry in Tamil Nadu is currently at a huge disadvantage due to other states extending support measures for exports. The industry has approached the Tamil Nadu Government to extend similar support like Maharashtra to export sugar.

For the year 2006-07
The Company achieved a gross Turnover of Rs.583.23 crore as compared to Rs.978.46 crore (Rs.746.93 crore excluding Parryware) in 2005-06. The drop in Turnover was mainly due to a decline of 30% in Sugar sales volume. However, supply of Power to the grid registered a growth of 73% over last year mainly due to increase in generation of power from the 18 MW Cogeneration plant at Pudukottai commissioned in March 2006.

The Earnings before Interest, Depreciation, Tax and Amortization (EBIDTA) excluding one-time profit on sale of investments was Rs 82.97 crore as against Rs 119.58 crore (after excluding Parryware business and Profit on sale of investment) in 2005-06. The drop in sugar profits by 42% mainly contributed for lower operating EBIDTA during current year. The depreciation for the year at Rs.32.87 crore (Rs.29.15 crore). The company has earned a net interest income of Rs.2.11 crore for the year as compared to the net finance charges of Rs.7.39 crore in 2005-06.

The Earnings before interest and tax (EBIT) rose to Rs.168.22 crore (Rs.148.51 crore) and the profit after tax stood at Rs.127.42 crore (Rs.115.84). For the year Profit After Tax excluding one time profit on sale of investments stands at Rs.35.70 crore.

The results for the year ended 31st March, 2007 includes operations of Nutraceuticals division for 7 months from 1st September, 2006 and the results of previous year include operations of Parryware division for 11months and hence are not comparable.

Dividend
The Board of Directors are pleased to recommended a final dividend of Rs. 1.40 per equity share (70%) on Equity Shares of Rs. 2 each. With this the total dividend declared for the year is Rs. 5.90 per equity share (295%) including the interim dividend of Rs.4.50 (225%) per equity share of Rs.2/- already paid in August, 2006.

Divisional Performance

Sugar
The sugar division generated a revenue of Rs.556 crore during the year ended 31st March, 2007 with earnings before interest and tax of Rs. 31 crore as against Rs. 80 crore for the previous year. The PBIT was less mainly due to the depressed selling price of sugar in the 2nd half of the year.

The company's fifth sugar plant at Puducherry has commenced operations and achieved the rated production capacity within a short period of time. The projects to increase throughputs in the other 4 sugar units are progressing well and the total crushing capacity likely to be increased to 19500 TCD by year end.

The 22 MW Cogeneration unit has been commissioned successfully in Pugalur. With this the total capacity of cogen facilities will be at 65 MW. Another cogeneration plant is currently under construction in Pettavaittalai.

Bio-Pesticides
The Bio Pesticides division of the Company has emerged as a global leader in the Neem based bio-pesticide business and continues to focus on its core product - the NEEMAZALâ range of products.

Export Sales and Revenues registered a growth over the previous year, with America and Europe continuing to be the major markets. The division has earned a revenue of Rs. 26 crore for the year and earnings before interest and tax of Rs.2.93 crore.

Nutraceuticals
Parry Nutraceuticals Ltd. has been merged with the company effective 1st September 2006 and is currently functioning as a division of the company.

The Nutraceuticals division clocked a turnover of Rs 11.12 crore for the 7 months period ended 31st March 2007. The earnings before interest and tax was Rs.1.30 crore. The products of this business continued to grow in all the markets.

About the Murugappa Group
Headquartered in Chennai, the Rs.7400 plus crore Murugappa Group is India's leading business conglomerate, which fosters an environment of professionalism for its strong workforce of 28,000 employees. Market leaders in diverse areas of business viz. engineering, abrasives, finance, general insurance, sanitaryware, cycles, sugar, farm inputs, fertilizers, plantations, bio products and nutraceuticals, its 29 registered companies have manufacturing facilities spread across 12 states in India.

The Group has forged strong joint venture alliances with leading international companies like Roca, Cargill, Cerdak, DBS Bank, Mitsui Sumitomo and Groupe Chimique Tunisien and has consolidated its status as one of the fastest growing diversified business houses in India.

Contact Information

D. Kumaraswamy
Chief Financial Officer-E I D Parry (India) Limited
Tel: 044 2534 0723 / 98400 20958
Email: KumaraswamyD@parry.murugappa.com

Chandrika Raman
Asst. General Manager-Group Corporate Communications - Murugappa Group
Tel: 044 2530 6535 / 98400 71172
Email: chandrikaR@corp.murugappa.com

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