JAI BALAJI INDUSTRIES LTD. FULL YEAR REVENUE RECORDED STRONG GROWTH

JAI BALAJI INDUSTRIES LTD.

FULL YEAR REVENUE RECORDED STRONG GROWTH

Kolkata – 30th June, 2008

Jai Balaji Industries Limited, the flagship company of Jai Balaji Group has approved its audited results for the year ended 31st March, 2008 in the meeting of the Board of Directors held today. It has reported an impressive performance during the financial year 2007- 08. During the year total revenue of the Company was Rs. 1,347.28 crore, representing an increase by 29.7% as compared with that of financial year 2006-07. The Net Profit saw a significant rise to Rs. 118.87 crore, representing an increase of 91% from that of 06 -07.

The earning per share for the year was Rs. 25.23 as compared to Rs 13.20 in the previous year representing an increase of 91%. The Board of Directors recommended a final dividend of 10% on equity shares of the Company for the financial year 2007-08.

During the year under review, revenue of the Company recorded a significant increase due to surged sales volume and market prices in the iron and steel industry.

The Company continued its operation strategy of fine-tuning its product mix, maintaining an increasing proportion of sales volume of higher margin Finished products and H-section steel, which provided a positive contribution to the Company’s annual results. The massive infrastructure development and urbanization in India had led to a surge in demand for the Company’s steel products.

“Although the cost of sale increased during the year due to raw material pressures, the Company was able to successfully maintain and improve margins. Its strategy of cost control, fine-tuning its product mix, building the brand and focusing on the customers enabled the Company to increase the gross profit margin” said Mr. Aditya Jajodia, Chairman and Managing Director of Jai Balaji Industries Limited.
During the year, company expanded organically and in-organically. The company has successfully completed two acquisitions namely steel division of HEG Ltd. at Chattisgarh having a Sponge Iron plant of the capacity of 120,000 MT p.a., Steel Melting Shop of the capacity of 100,000 MT p.a. and a 13 MW Captive Power Plant and Nilachal Iron & Power Ltd. in Jharkhand having a sponge iron plant of the capacity of 100,000 MT p.a.

“We will grow and the growth will be rapid. Every opportunity, Greenfield or Brownfield which is in synergy with our present operation will be explored and adopted.” remarked Mr. Aditya Jajodia.

During the year, company has raised capital of Rs 335.04 crore by way of private placement of 83,59,000 zero coupon compulsorily convertible debentures (CCDs) to Citi Venture International and India Equity Partners and 96,00,000 warrants to promoters and non-promoters. Each CCD and warrant is convertible into one equity share within 18 months from the date of allotment at a conversion price of Rs.326.90 per equity share.

Jai Balaji has also signed a Memorandum of Agreement with the Government of West Bengal for setting up a 5 million tonne integrated steel plant, 3 million tonne cement plant and 1,215 MW captive power plant in Purulia District of West Bengal. Company is hopeful to kick off its first module there as early as possible.

Announcing the results here today, Aditya Jajodia, Chairman and Managing Director of Jai Balaji Group said “In terms of relative standing, India is placed among the one of the top countries globally with reserves of Iron ore and Coal. Speedy allotment of captive raw material resources will enable the industry to harness the immense opportunity and potential to develop a scaled up, world class fully integrated steel industry. Speed of growth and execution skill will be the key factors that will determine the extent to which the available opportunity was exploited. At Jai Balaji we recognize this fact and with combined effort from all the stakeholders we will achieve the desired results.”