Directors’ Report

Click here for Annexure 'A'

To the Members,
The Directors hereby present their hundred and first annual report on the business and operations of the Company and the consolidated and standalone financial accounts for the year ended 31st March, 2008.



	Tata Steel Group		Tata Steel Standalone
	2007-08	2006-07	2007-08	2006-07
Net Sales / Income	131,535.88	25,212.38	19,693.28	17,551.09
Total Expenditure (net of expenditure transferred to capital)	113,542.76	17,762.23	11,469.74	10,577.82
Operating Profit	17,993.12	7,450.15	8,223.54	6,973.27
Add: Dividend and other income	574.21	438.07	335.00	433.67
Profit before Interest, Depreciation, Exceptional items and Taxes	18,567.33	7,888.22	8,558.54	7,406.94
Less: Interest	4,183.76	411.19	878.70	173.90
Profit before Depreciation, Exceptional items and Taxes	14,383.57	7,477.03	7,679.84	7,233.04
Less: Depreciation	4,136.95	1,010.98	834.61	819.29
Profit before Exceptional items and Taxes	10,246.62	6,466.05	6,845.23	6,413.75
Add/(Less): Exceptional items	6,124.44	(153.03)	221.13	(152.10)
Profit before taxes	16,371.06	6,313.02	7,066.36	6,261.65
Less: Provision for current taxation	3,353.73	2,145.52	2,252.00	2,076.01
Less: Provision for deferred taxation	674.58	(15.52)	108.33	(52.51)
Less: Provision for Fringe Benefits tax	20.99	17.41	19.00	16.00
Profit after taxes	12,321.76	4,165.61	4,687.03	4,222.15
Less: Minority Interest	139.94	67.52
Add: Share of profit of Associates	168.16	79.18
Profit after minority interest and share of profit of Associates	12,349.98	4,177.27	4,687.03	4,222.15
Add: Balance brought forward from the previous year	4,840.39	3,298.06	4,593.98	2,976.16
Balance	17,190.37	7,475.33	9,281.01	7,198.31
Which the Directors have appropriated as under to
(i) Proposed Dividend	1,167.86	942.87	1,168.93	943.91
(ii) Dividend on Compulsorily Convertible Preference Shares	22.19		22.19
(iii) Tax on dividend	207.75	163.42	202.43	160.42
(iv) Special reserve	5,913.16	3.95	—	—
(v) Statutory reserve	96.30	—	—	—
(vi) General reserve	1,549.08	1,524.70	1,500.00	1,500.00
Total	8,956.34	2,634.94	2,893.55	2,604.33
Leaving a Balance to be carried forward	8,234.03	4,840.39	6,387.46	4,593.98

Centenary Year
On 26th August 2007, your Company completed its 100 years. The centenary celebrations began with a commemorative function and a screening of the feature film ‘The Spirit of Steel’ and the release of ‘Romance of Tata Steel’, a book authored by Mr. R. M. Lala, with large participation from the citizens of Jamshedpur and the employees of your Company.

In line with your Company’s commitment to the society and as a part of the centenary celebrations, various cultural activities and social outreach programmes at several locations involving employees and the local communities were initiated. Initiatives were taken to promote land and water management projects in the backward tribal blocks of the States of Jharkhand, Orissa and Chhattisgarh and improve the livelihood of 40,000 poor tribal households in 400 villages. Special efforts have been made in the field of education by providing schools for children of tribal communities and scheduled caste families and train them to become self-reliant.

During the golden jubilee celebrations, in 1958, Pandit Jawaharlal Nehru visited Jamshedpur and planted a banyan tree sapling. In the 100th year, the Honourable Prime Minister Dr. Manmohan Singh along with other dignitaries visited the Steel city and planted the centenary banyan tree. He also unveiled a centenary postage stamp brought out by the Government of India’s Ministry of Communications to mark Tata Steel’s 100 years of service to the country. It symbolises your Company’s commitment and dedication, not only towards the industrial revolution in India in 1907 but also to continue to create benchmarks in every field that it has ventured in the last century.

Global Economy
The Global economy grew at 2.2% in 2007 as compared to 2.9% in 2006. Global economic activity slowed since the second half of 2007 against the backdrop of the financial turmoil and a deepening US downturn. The unfolding of the subprime mortgage crisis coupled with growing concerns about a contraction in economic activity in the US had a cascading effect on global growth. In the US, real GDP grew by 0.6% in the fourth quarter of 2007 as compared with 2.1% a year ago and 4.9% in the previous quarter. US real GDP growth is expected to slow further during 2008 as the housing market downturn deepens and the financial market turmoil spreads across the financial system. Banks in several advanced industrial economies have been tightening lending standards and the credit crunch that has affected world financial markets since August 2007 was a reflection of deeper problems relating to huge debt build-up during the credit boom of recent years. The current consensus view is that the global economy will only slow modestly further in 2008. Developments up to the first half have been broadly consistent with this view as growth in the Euro area, Japan and major emerging market economies continued to be strong.

The UK economy grew by almost 3% in 2007, primarily driven by consumption, business investment and residential construction. Real GDP in the Euro area grew by 2.3% in the fourth quarter of 2007 on a year-on-year basis as compared with 3.3% a year ago.

Growth in emerging market economies (EMEs) last year once again significantly exceeded that in the rest of the world. Foreign currency inflows were large, reflecting continued growth in current account surpluses and capital inflows in 2007. Recent increases in headline inflation have reflected in the steep increases in oil and food prices. The Chinese economy grew by 11.4% in 2007 as compared with 11.1% in 2006 as its total foreign exchange reserves, increased to USD 1.7 trillion in March 2008 compared with USD 1.2 trillion in March 2007. In 2008, the Chinese economy is expected to grow at a moderate pace of 9.3% as measures to resolve problems such as overheated growth in fixed asset investment and excessive supply of money and credit take effect. The Indian economy grew by about 8.7% in 2007-08 as compared to 9.6% in 2006-07.The lower growth was attributable to the agricultural sector growing under 3%, growth in industry decelerating to 8.9% from 11% in 2006-07 and a slowdown in the manufacturing sector to 9.4% from 12% in FY 2007. In Japan, the economy grew by 3.7% in the fourth quarter of 2007 as compared with 2.2% a year ago. However, recent lead indicators point to slackening of momentum as consumer and business sentiment has weakened.

Steel Industry
The world crude steel output reached 1,344 million tonnes in 2007, up by around 100 million tonnes over 2006. This increase of 7.5% was driven mainly by China where the crude steel production grew by 60 million tonnes over 2006 (an increase of 14%). While China’s production constitutes 34% of the world production, the country’s consumption constitutes almost 31% of the world consumption. The crude steel production in India was higher by 8% in 2007 over 2006. The increase primarily was due to a sustained demand momentum in key-end use segments like construction, capital goods and automobiles. The supply side has not been able to keep pace with the strong demand resulting in India becoming a net importer of steel.

Steel production in the European Zone remained stable, with year-end figures of 210 million tonnes, a growth of around 2% over 2006. The imports in the European Union also remained at a high level during 2007.

The latest global steel consumption forecast predicts 6.77% year on year increase in steel consumption in the current year. The additions in the capacity are likely to be around 90 million tonnes. The greatest concern of the steel industry is the availability of raw materials at a competitive price. There have been unprecedented cost increases in iron ore by around 65% and coking coal by around 200% in 2008, which would have an impact on the steel prices.

Business Results
Tata Steel Group, on a consolidated basis had a net sales of Rs.131,536 crores in the FY 2007-08 against Rs. 25,212 crores in the FY 2006-07.

The total operating expenditure (before interest expenses and depreciation) was at Rs.113,543 crores in FY 2007-08 against Rs. 17,762 crores in FY 2006-07. The major components of the expenditure in FY 2007-08 were purchase of finished and semi finished steel, raw materials consumed, staff cost, freight & handling and other expenditure. The interest charges were at Rs. 4,184 crores in the current financial year against Rs. 411 crores in the last financial year. The Exceptional items , a gain of Rs. 6,124 crores include the actuarial gain of Rs. 5,907 crores in Corus on funds for employee benefits . The gain is on account of recovery of bond yields used to discount scheme liabilities and recovery in asset values of the scheme funds. These gains are required to be accounted for through the Profit & Loss Account under Indian GAAP.

Pursuant to the Accounting Standard AS 21 issued by the Institute of Chartered Accountants of India, consolidated financial statements presented by the Company include financial information of its subsidiaries. The Company has received the approval from the Ministry of Corporate Affairs vide its Letter No. 47/337/2008-CL-III dated 4th June, 2008, exempting the Company from attaching the balance sheet, profit and loss account and other documents of the subsidiary companies to the balance sheet of the Company.

As per the terms of the approval letter, a statement containing brief financial details of the Company’s subsidiaries for the year ended 31st March, 2008 is included in the annual report. The annual accounts of these subsidiaries and the related detailed information will be made available to any member of the Company / its subsidiaries seeking such information at any point of time and are also available for inspection by any member of the Company / its subsidiaries at the Company’s Registered Office. The annual accounts of the said subsidiaries will also be available for inspection as above at the Head Office of the respective subsidiary companies.

On 2nd April, 2007, Tata Steel UK Limited (‘TSUK’), a subsidiary of Tulip UK Holding No. 1 which in turn is a subsidiary of Tata Steel completed the acquisition of Corus Group plc (‘Corus’). The consolidated results include the financial statements of Corus from 2nd April, 2007. Consequently, the data of the previous year is not comparable.

Dividend
The Board for the year ended 31st March, 2008 has recommended a Dividend @ 2% on 547,251,605 Compulsorily Convertible Preference Shares (CCPS) of Rs. 100 each, payable pro-rata from the date of allotment of CCPS i.e. 18th January 2008.

The Board, for the year ended 31st March, 2008, has recommended a dividend @ 160%. The dividend will be paid on 730,584,320 Ordinary Shares at Rs. 16 per share (2006-07 : on 608,972,856 Ordinary Shares at Rs. 15.50 per share including special dividend of Rs. 2.50 per share).

The dividends on CCPS and Ordinary Shares are subject to the approvals of the shareholders at the Annual General Meeting.

The dividend pay out works out to 29.18% (2006-07: 26.16%) for the standalone company and on a consolidated basis it is 11.09% (2006-07: 26.51%).

Tata Steel-Corus Integration
“One enterprise – two entities” has been the driving philosophy of the integration process which has been designed at two levels: one at a strategic level and the other to maximise synergy benefits in various functions of the business.

A joint team was mandated to identify where the two entities needed to work together or work in a coordinated manner and also the processes which would be managed separately by the entities. The teams study and recommendations have resulted in the implementation of a governance structure in January 2008 to bring alive the ‘Operating Model’ designed.

To oversee the progress on the strategy and integration plans and ensure that key milestones are met, a Strategy & Integration Committee (SIC) has been constituted under Chairmanship of Group Chairman.
A structured approach has been followed for the synergy and integration in various functional areas. Joint integration teams formed for key areas have identified synergies worth USD 450 million and action plans drawn up will ensure that these targets are realised by end March 2010.

Site specific workshops and knowledge sharing sessions have been conducted at various plant locations for identifying breakthrough improvements in the area of throughput increase and cost reduction.

During the year, synergy benefits of USD 76 million have been realised. Tata Steel has derived the benefits in the area of manufacturing, whereas in Corus, the benefits are from reduction in taxation and in shared services in the area of legal, investor relations, etc. in the Corporate Centre.

Finance
During FY 2007-08, the financing structure of the Corus transaction has been reorganised to achieve fiscal unity in the Netherlands and consequent tax efficiencies. The Corus businesses in UK and Netherlands are now organised under fully owned subsidiaries of Tata Steel Netherlands B.V., which in turn is an indirectly fully owned subsidiary of Tata Steel Limited.

By the close of April 2008, the financing for the Corus acquisition has been completed with all the recourse bridge funding contracted for the acquisition having been paid off through a mix of debt, equity and internal accruals and the non-recourse funding syndicated during the year.

In September 2007, the Company issued USD 0.875 billion of 1% Foreign Currency Convertible Alternative Reference Securities (CARS). Between September 4, 2011 and August 6, 2012, each security is convertible at the option of holder of the security, at a conversion price of Rs. 758.10 into a Qualifying Security issued by the Company. The Company must redeem all outstanding CARS at 123.349% of their principal amount together with accrued and unpaid interest no later than September 5, 2012.

The Company raised an amount of Rs. 9121 crores through a Rights and Cumulative Compulsorily Convertible Preference Share Issue and Rs. 25 billion through a long term loan. The syndication of the GBP 3.67 billion senior facility consisting of multiple tranches of term loans and a GBP 0.5 Billion five year revolving credit facility, secured by the assets of Corus was successfully closed in December 2007 by which time, a large number of banks as well as institutions had come into the transaction. The deal was widely recognised as a landmark deal and won numerous awards and recognition from financial journals.

Tata Steel also privately placed Non-Convertible Debentures totaling upto Rs. 2,000 crores in May 2008. The deemed date of allotment of these debentures was 7th May, 2008 and they consist of 3 series: 3 year floating (MIBOR-linked) notes (Rs. 1,090 crores), 7 year fixed rate notes (Rs. 620 crores) and 3 year fixed rate notes (Rs. 290 crores). These funds may be used by the company for various corporate needs.

The Company hedged the foreign currency risk on repayment of the major part of the USD 1.65 billion of external commercial borrowings drawn in FY 2006-07. The foreign currency repayment risk on the CARS remains unhedged since they may be converted to underlying securities in FY 2012 and FY 2013.
Tata Steel Netherlands, the entity in whose books the non-recourse debt has been taken was successful in encouraging a high proportion of investors to voluntarily convert their debt to Euro via the re-denomination route. The majority of the balance debt was then swapped to Euro from GBP so that foreign currency risk could be minimised. Tata Steel Netherlands also hedged the majority of its Euro interest rate risk.

Rights Issues
During the year under review, the Company allotted the Cumulative Convertible Preference Shares (CCPS) and Ordinary Shares on a Rights basis to the shareholders of the Company as under:

121,611,464 Ordinary Shares of Rs.10 each at a premium of Rs.290 per share in the ratio of 1:5, aggregating to Rs. 3,648 crores.
547,251,605 2% Convertible Cumulative Preference Shares (CCPS) of Rs. 100 each at an issue price of Rs. 100 each, in the ratio of 9:10, aggregating to Rs. 5,473 crores. As per the terms of the issue, six CCPS of Rs.100 each are compulsorily and automatically convertible on 1st September, 2009, into one Ordinary Share of Rs. 10 each, at a premium of Rs. 590 per share.

The proceeds of the Rights Issue have been utilised to repay the short term Bridge Loan availed by the Company from the State Bank of India.

Subsidiaries
A list of the Company’s subsidiaries is given in page numbers 212-221of this Report.

Expansion Projects
Brownfield Projects
After successful completion of 1 mtpa expansion programme in the year 2005, the Company embarked upon its journey to reach 10 mtpa crude steel making capacity at Jamshedpur Works. This is to be achieved by year 2011 in two phases. Work on the first phase, which takes the capacity of Jamshedpur Steel Works to 6.8 mtpa at a project cost of Rs. 4,550 crores was started in the year 2006. The same is now nearing completion. The new Sinter Plant No. 4 was commissioned in 2007 and new H-Blast Furnace was blown-in on 31st May, 2008, ahead of schedule by a month. Expansion programme for Steel Making Shops is under execution.
The Company has simultaneously initiated work on the second phase, the 3 mtpa expansion programme, which will enable it to reach crude steel capacity of 10 mtpa at Jamshedpur Works by the year 2011. Under this expansion programme, Iron Making facilities will be up-graded. Besides, new facilities such as a Steel Making Shop (LD Shop No. 3), Thin Slab Casting & Rolling Mill and a pelletizing plant of 6 mtpa capacity will be installed. The project is progressing as per schedule.

Greenfield Projects
The Company has begun the process of building a new integrated steel plant at Kalinganagar, Orissa with a total capacity of 6.0 mtpa to be set up in two phases of 3.0 mtpa each. The land acquisition, rehabilitation and resettlement work is in progress.

Orders for major equipment have been finalised. Skill upgradation training is being provided to the members of displaced families. The Company has informed the Government of Orissa of its fulfillment of MOU conditions, with a request to the Central Government for recommendation of iron ore mining lease.

The Company has also entered into a Memorandum of Understanding with the state gtovernments of Chhattisgarh and Jharkhand respectively for setting up steel plants. The process of submitting applications for various licenses for mining leases and environmental clearance has been initiated.

Coke is one of the main raw materials in the iron making process. The Company has set up Hooghly Metcoke and Power Company Limited, a subsidiary, to manufacture 1.6 million tonnes per annum of coke to meet the requirement on expansion. The increased requirement of power will be met from a 90 MW power plant being set up by Tata Power Company.

During the year, the Company in India incurred capital expenditure of Rs. 2,459 crores.

Other Projects
Tata BlueScope Steel Limited
Tata BlueScope Steel is an equal joint venture between Tata Steel and BlueScope Steel in the field of coated steel, steel building solutions and related building products. The Company operates in the South Asian Association for Regional Cooperation (SAARC) region. Tata BlueScope Steel has two business divisions, Buildings Division and Coated Steel Division.

The Buildings Division business markets pre-engineered buildings (PEB), roll-formed roof and wall cladding solutions, related building components and distribution of colour coated sheets for retail customers. The Coated Steel business markets metallic coated and pre-painted steel, for the building and construction industry. Tata BlueScope Steel’s Buildings Division has three manufacturing facilities located at Pune, Chennai and Bhiwadi and are certified by Underwriters Laboratory Inc. for ISO 9001: 2000. The premium brands include the BUTLER® pre-engineered steel buildings and the LYSAGHT® range of steel building solutions. The Coated Steel Division markets premium brands including the pre-painted COLORBOND® steel and the metallic coated ZINCALUME® steel.

The Coated Steel manufacturing facility at Jamshedpur will be operational from the first quarter of 2010. This facility will have an annual metallic coating capacity of 250,000 MT and paint line capacity of 150,000 MT.

In view of high construction activities coupled with infrastructure growth and good response from the industry, the demand for PEB and building solutions is expected to grow rapidly in times to come.

Tata Steel (KZN) Pty. Limited
Tata Steel (KZN) Pty Limited, a subsidiary of the Company, is setting up a High Carbon Ferro Chrome plant with a capacity of 1,50,000 tpa at Richards Bay, South Africa. The first furnace was started in April 2008 and the second furnace is scheduled for June 2008. It is expected that commercial production will start in July 2008. This was an historic event, being the first Greenfield project of the Tata Group commissioned in South Africa.

The Dhamra Port Company Limited
The Dhamra Port Company Limited (‘DPCL’), a Joint Venture company between the Company and Larsen & Toubro Limited (‘L&T’) is developing an all weather modern deep water port in the state of Orissa. (‘Dhamra Port Project’). The bulk cargo berths are being designed to accommodate upto 180,000 (DWT) vessels.

The major portion of the land required for the Project has been acquired through State Government. The construction work at the port site has commenced and the same is progressing satisfactorily. Your Company has taken adequate measures for conservation of the environment, endangered species and other related issues which has significant impact on successful completion of the Project.

Tata NYK Shipping Pte. Limited
Tata NYK Shipping Pte. Ltd., a joint venture shipping company between the Company and Nippon Yusen Kabushiki Kaisha (NYK Line) commenced shipping activities for Tata Group companies and other clients with five ships on a ‘time chartered’ basis. Tata NYK handled around 2.4 million tonnes of dry cargo.

Tata NYK has worked out a five year business plan which projects to service more than 20 million tonnes of cargo per annum through a fleet of owned and chartered ships.

Joint Venture with Vietnam Steel Corporation
Your Company has entered into two Memorandum of Understandings with Vietnam Steel Corporation for setting up a 4.5 mtpa steel project (in 2 phases) and a Cold Rolling Mill in Ha Tinh Province, Vietnam. The Joint Venture Company would also further invest in the mining projects in Vietnam, subject to financial viability being established.

Raw Material Security
Your Company is self-sufficient in iron ore for 100% and ~60% for coking coal i.e. an average of 80% raw material security for its Indian operations. After the acquisition of Corus the extent of captive raw material for the combined entity stands at around 22%. Having a reasonable level of raw material security is imperative for long term sustainability especially during downturns. Tata Steel, in line with its strategy, is continuously exploring various raw material opportunities across the globe. Further, the increase in global steel demand mainly driven by China and other Asian countries has pushed the global steel prices upward sharply, which led to an increase of price of iron ore, coal, coke, scrap, etc. The initiatives of the Tata Steel Group to maintain cost competitiveness in the global arena, as well as to increase its raw material security are as under

Coal Project, Carborough Downs: Tata Steel took strategic interest of 5% in coal mining project in Australia, in partnership with AMCI, Nippon Steel, JFE and POSCO in September 2005 with 20% offtake rights. The Joint Venture was formed for development of Greenfield underground coal project in Bowen Basin, Queensland. The first raw coal production started from August 2006. The total capital investment would be estimated around USD 401 million.
Coal Project, Mozambique: In November 2007, the Company entered into a Joint Venture Agreement with Riversdale Mining Limited for 35% stake in two coal tenements - Benga and Tete in Mozambique. The Company has also secured a right for 40% share of the coking coal. The coking coal derived from this project would be supplied to the Tata Steel Group’s facilities in Europe, Asia and elsewhere.
Iron Ore Project, Ivory Coast: In December 2007, Tata Steel entered into JV with Sodemi for 85% stake for development of Mount Nimba Iron Ore deposit in Ivory Coast. The initial phase would involve exploration and detailed feasibility assessment followed by construction of the mines and beneficiation facilities. Iron ore from this project will be supplied to Corus facilities in Europe. The JV company in the name of Tata Steel Cote d’ Ivoire S. A has been formed.
Limestone Project, Oman: About 40% to 50% of the present requirement of limestone of Tata Steel is being sourced from indigenous sources and the balance is being imported. The Company has been continuously evaluating options to own limestone mines for its captive use. In January 2008, Tata Steel acquired 70% stake in Al Rimal Mining LLC, an existing company of Al Bahja Group of Oman. The JV will undertake mining of limestone in Uyun in Salalah.
Coal Projects, SAIL: In January 2008, Tata Steel entered into 50:50 joint venture with SAIL for development of coal blocks to meet their captive coal requirements. The Joint Venture would acquire and develop coal blocks.

Safety

The Tata Steel Management is committed to ensure safety of its employees, plant and community at all its operation sites. With the help of DuPont Safety Resources, safety consultants, a Safety Management System has been established. Communication, involvement, motivation, skill development, training and health have been identified as the key drivers for safe working environment. Tata Steel has established a Safety Culture by inculcating safe behavior among its employees. Theme based monthly campaigns built on the analysis of past serious incidents had made the management and workmen aware and revisit their work places to eliminate many hazards.

As part of social commitments for community safety at large, safety knowledge was imparted to the school children with the help of M/s. Humbert Ebner India Pvt. Ltd. The Company also started implementing ‘Process Safety & Risk Management system’ for high hazard operations, a first of its kind in any Indian steel plant. As part of Centenary Safety Celebrations, the Company initiated safety awareness amongst the associate companies and other industries through sharing its experience and knowledge. These initiatives have resulted in reducing the injuries and lost time significantly.

Environment
As a socially conscious corporate, Tata Steel has always carried forward all its operations and procedures following environment friendly norms with all necessary clearances. Tata Steel’s Vision 2012 is – We aspire to be the global steel industry benchmark for Value Creation and Corporate Citizenship. With a focus on the environment, the Company has set a target to reduce CO₂ emissions to 1.5 t/tls compared to the current 1.8 t/tls.

Directors
Mr. Andrew Robb and Dr. T. Mukherjee were appointed additional Directors on the Board of the Company with effect from 22nd November, 2007.

Mr. Andrew Robb is the director on the Board of Tata Steel UK Limited since January 2008. Prior to January 2008 he was a Non Executive Director of Corus Group Ltd. since August 2003 and Chairman of its Audit Committee.

Dr. T. Mukherjee retired as the Deputy Managing Director of the Company on 31st October, 2007, on reaching the age of 65 years. He joined the Company in 1971 and held various posts since then.

The Directors believe that the appointment of the above mentioned directors on the Board of the Company will bring in a rich and varied experience that will enable it to manage the business of the size and complexity of the Company.

Mr. A.N. Singh, Deputy Managing Director (Corporate Services), on taking charge as Managing Trustee of Sir Dorabjee Tata Trust and other associated Trusts from 1st October, 2007, stepped down from the Board effective 30th September, 2007. The Board records its appreciation of the contribution made by Mr. Singh during his tenure with the Company.

In accordance with the provisions of the Companies Act, 1956, and the Company’s Articles of Association, Mr. S.M. Palia, Mr. Suresh Krishna, Mr. Ishaat Hussain and Dr. J.J. Irani, retire by rotation and are eligible for re-appointment.

Energy, Technology and Foreign Exchange
Details of energy conservation and research and development activities undertaken by the Company along with the information in accordance with the provisions of Section 217(1)(e) of the Companies Act, 1956, read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, are given in Annexure ‘A’ to the Directors’ Report.

Particulars of Employees
Information in accordance with the provisions of Section 217 (2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975, as amended, regarding employees is given in Annexure ‘B’ to the Directors’ Report.

Corporate Governance
Pursuant to Clause 49 of the Listing Agreements with the Stock Exchanges, a Management Discussion and Analysis, Corporate Governance Report, Managing Director’s and Auditors’ Certificate regarding compliance of conditions of Corporate Governance are made a part of the Annual Report. A note on the Company’s corporate sustainability initiatives is also included.

Directors’ Responsibility Statement
Pursuant to Section 217 (2AA) of the Companies Act, 1956, the Directors, based on the representations received from the Operating Management, confirm that –

in the preparation of the annual accounts, the applicable accounting standards have been followed and that there are no material departures;
they have, in the selection of the Accounting Policies, consulted the Statutory Auditors and have applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for that period;
they have taken proper and sufficient care to the best of their knowledge and ability for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
they have prepared the annual accounts on a going concern basis.

On behalf of the Board of Directors

RATAN N. TATA
Chairman

Mumbai, 26th June, 2008

Declaration Regarding Compliance by Board Members and Senior Management Personnel with the Code of Conduct

This is to confirm that the Company has adopted Tata Code of Conduct for its employees including the Managing Director and Whole time Directors. In addition, the Company has adopted the Tata Code of Conduct for Non-Executive Directors. Both these Codes are posted on the Company’s website.

I confirm that the Company has in respect of the financial year ended 31st March, 2008, received from the senior management team of the Company and the Members of the Board a declaration of compliance with the Code of Conduct as applicable to them.

For the purpose of this declaration, Senior Management Team means the Members of the Management one level below the Executive Directors as on 31st March, 2008.

B. MUTHURAMAN
Managing Director

Mumbai, 26th June, 2008