China with a production of over 300 million tonnes was a leader in steel consumption as well as production. Compare that to India's total production of 32 million tonnes and the total output of steel in the world at over 1 billion tonnes and you will see that Indian steel industry needs to and I am happy to say, has the potential to, grow at a much faster pace. With GDP growth rates expected to be in the 7 to 8% range for the next few years, steel companies can hope to see bright sunshine years for same time to come.

The first quarter of the current fiscal witnessed softening of prices in the international markets, due to inventory build up. As India is now much more integrated with the global economy, this had an impact on domestic prices as well. However, with inventories coming down and demand for steel remaining robust, prices are stabilizing and in our view will remain firm for some time. Raw material prices have also remained firm and the real challenge for the industry is to maintain its competitive edge in international markets by a series of actions on cost, productivity, product mix and value addition at every stage of manufacture.

Coming to the performance of the Company, Essar Steel had an exceptionally good year. The year's revenues and profitability are at an all time high as you might have seen from the Annual Report. Revenues for the year at Rs. 6121 crore were up by 65% over last year, EBIDTA by a whopping 157% and profit after tax was close to Rs 600 crore.

Building on the back of a good year, the company's first quarter performance this year has been commendable. Sales at Rs 1653 crore showed a growth of 24.5 % and net profit at Rs 208 crore grew by 300% over the first quarter last year. It is significant to note that while sales volumes grew by 9 %, sales in rupee terms grew by 24.5%. This is a clear indication of the success of our focus on a richer product mix and value addition.

You will be pleased to know that your Company has completed two major acquisitions- Hy Grade Pellets and Steel Corporation of Gujarat which were the final steps towards becoming a fully integrated steel producer. This gives us control at the upstream and downstream ends of the manufacturing operations, yielding considerable advantages of quality, cost and product mix.

The acquisitions have been financed without increasing the debt and this will have a positive impact on your company's bottom-line in the coming years. This also makes us the largest integrated steel producer in Western India and with our expansion plans we will become the largest producer of flat steel products in the country.

Essar Steel's current capacity of 3 million tones per annum will go up to 4.6 million tonnes by the end of this fiscal year. This will mean that we will add the capacity of one more steel plant and that too at a substantially lower cost than a green-field project. This is a major strength for your company.

To meet the requirements for the Hazira expansion, we are also executing suitable capacity enhancement programs at Bailadilla, Vizag and the HBI plant at Hazira. We at Essar have access to the world's richest iron ore at Bailadilla and have a world class facility at Vizag for manufacturing pellets.

The beneficiation plant and the slurry pipeline have been completed and will be commissioned shortly. These are extremely difficult projects involving laying of pipelines through the most difficult terrain and conditions, passing through three states. This slurry pipe line is the second longest in the world. I am sure you will join me in congratulating the teams of Hy Grade Pellets, Essar Constructions and Essar Steel for this magnificent achievement. Similarly, all work related to the expansion at Hazira is also on course.

I am also happy to inform you about our success in mining value due to our actions in our downstream operations and a very important milestone in your Company's history.

The Hon'ble Chief Minister of Gujarat Shri Narendrabhai Modi inaugurated our cold Rolling Complex on 2nd September, signaling the beginning of the production of high value, high quality, and highly customized cold rolling products. To a non technical person it really means that we at Essar Steel are getting closer your every day life. The car you drive, the fridge you use, the pipes that bring water and oil to you may well be made from your company's steel.

Shri. Narendrabhai made our hearts swell with pride when he started his speech by saying, "Gujarat Government and Essar Steel are made for each other". Essar Steel is "made for you" is where we will go from here. He also said that Essar set up a plant in Gujarat where iron ore is not available and yet have succeeded because of their tenacity and grit.

Essar's thrust on total integration, backed by technology and customers focus, has yielded excellent results. We expect our market shares to go up from 13% to 15% in the domestic flat products segment and our share in specialty segments in Hot Rolled products to increase from 34% to 48%. The share of specialty grades in the export market as a percentage of our total exports went up from 42 % to 48 %. The company expects to gain a market share of 20% in the Cold Rolling segment in the country and it is expected that products from the CR complex will constitute over 40% of the company's revenues going forward. We have also begun exporting Cold Rolled and Galvanized products and these been well accepted. The current year's thrust will be on the automotive, white goods, construction and Oil and Gas industries.

Our marketing strategy on building relationships for long term contracts and increasing our geographic spread gives us a hedge against cyclicality in the industry and also enables us to safeguard margins.

In a nutshell, we are well positioned for the future. We have consolidated our position in the Indian steel industry and will reap the benefits of our strategy, investments and diligence.