1. The above results were reviewed by the Audit Committee and approved by the Board of Directors at their meetings held on April 24, 2009.

2. Pursuant to the announcement on "Accounting for Derivatives" issued by the Institute of Chartered Accountants of India in March 2008, the Company has accounted Mark-to-Market (MTM) losses aggregating Rs. 42,563 lakhs for the year ended December 31, 2008. The same has been treated as Exceptional Item. The Company has entered into Hedging Instruments, which are long term in nature to reduce interest cost/ Currency risk for the loans, which the Company has taken in past and is outstanding as of December 31, 2008. As per the Risk Management Policy, the Company is hedging the interest/ currency risk for the long term loans. The Company does not hold or issue derivative financial instruments for trading or speculative purposes. The Exceptional Item also includes derivative losses of Rs 1,820 lakhs.

3. In the month of October 2004, the Company had issued 110,000 Zero Coupon foreign currency convertible bonds of USD 1,000 each. The Bonds are considered as monetary liability. The Bonds are redeemable on maturity date at 129.578 percent of its principal amount, only if there is no conversion of bonds on or before September 25, 2009. The Company is evaluating various options for restructuring the debts of the Company. The FCCB including the premium payable will be part of the restructuring exercise. The Company is proposing to negotiate with the FCCB holders towards discount and/or extension of the due date of payment. During the year the Company has provided for FCCB premium of Rs 12,949 lakhs for the period October 2004 to December 2008.

4. As per note 5 to the Auditors Report for the year ended December 31, 2008, the Company had, on certain derivative contracts with banks, stopped payment of margins called by the banks during the year. Subsequent to the balance sheet date the banks, based on the Early Termination clause in the agreement, terminated these contracts and claimed an amount of Rs 48,952 lakhs, being the loss incurred on termination of such contracts. The Company contends that the forex transactions were unilaterally cancelled by the banks and the mark to market losses had arisen on account of counter positions advised by the banks. The Company has obtained a legal opinion that these contracts can be disputed. No provision has been made in the accounts for these demands which have been disclosed under contingent liabilities. The Company has not determined the quantum of mark to market losses as of the balance sheet date on the above contracts. Pending final settlement of the matter, we are unable to quantify the extent of provision that may be required to be made in this regard.

The Board is of the view the forex transactions were unilaterally cancelled by the banks and the mark to market losses had arisen on account of counter positions advised by the banks. The Company has obtained a legal opinion that these contracts can be disputed, and accordingly no provision for the same has been made. As the contracts are disputed it is not possible to ascertain the quantum of liability and accordingly the impact of the same on the profit or loss of the Company.

5. The Company is exclusively into Pharmaceutical business Segment.

6. Previous period figures have been recast/ re-classified to conform to the current period´s presentation.

H F Khorakiwala
Chairman