UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 6-K

Report of Foreign Private Issuer
Pursuant to Rule 13a-16 or 15d-16 of the Securities Exchange Act of 1934

Sterlite Industries (India) Limited

Not Applicable
(Translation of Registrant’s name into English)

Republic of India
(Jurisdiction of incorporation or organization)

Vedanta, 75 Nehru Road
Vile Parle East
Mumbai, Maharashtra 400-099, India
+91-22-6646-1000
(Address of principal executive offices)

Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F.

Form 20-F þ          Form 40-F o

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): o

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): o

Indicate by check mark whether the Registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.

Yes o          No þ

If “Yes” is marked, indicate below the file number assigned to registrant in connection with Rule 12g3-2(b): Not applicable.

 

 

Conventions used in this report

Unless otherwise stated in this report or unless the context otherwise requires, references herein to “we,” “us,” “our,” “Sterlite,” the “Company” or “our consolidated group of companies” mean Sterlite Industries (India) Limited, and its consolidated subsidiaries and its predecessors, collectively, including Monte Cello BV, or Monte Cello, Copper Mines of Tasmania Pty Ltd, or CMT, Thalanga Copper Mines Pty Ltd, or TCM, Bharat Aluminium Company Limited, or BALCO, Sterlite Energy Limited, or Sterlite Energy, Sterlite Opportunities and Ventures Limited, or SOVL, and Hindustan Zinc Limited, or HZL. Our financial information does not include Vedanta Resources plc, or Vedanta, Vedanta Resources Holdings Limited, or VRHL, Konkola Copper Mines plc, or KCM, Twin Star Holdings Limited, or Twin Star, the Anil Agarwal Discretionary Trust, or the Agarwal Trust, Onclave PTC Limited, or Onclave, The Madras Aluminium Company Limited, or MALCO, India Foils Limited, or IFL, Sterlite Technologies Limited , or STL, Sterlite Gold Limited, or Sterlite Gold, Monte Cello Corporation NV, or MCNV, Twin Star Infrastructure Limited, Sesa Goa Limited, Sesa Industries Limited and Vedanta Aluminium Limited, or Vedanta Aluminium, except that as to Vedanta Aluminium, our consolidated financial statements account for our 29.5% minority interest therein under the equity method of accounting, but Vedanta Aluminium is not otherwise included in our consolidated group of companies or our consolidated financial statements. References to the “Vedanta group” are to Vedanta and its subsidiaries.

In this report, references to The London Metal Exchange Limited, or LME, price of copper, zinc or aluminum are to the cash seller and settlement price on the LME for copper, zinc or aluminum for the period indicated.

In this report, all references herein to “US” or the “United States” are to the United States of America, its territories and its possessions. References to “UK” are to the United Kingdom. References to “India” are to the Republic of India. References to “$,” “US$,” “dollars” or “US dollars” are to the legal currency of the United States, references to “Rs.,” “Rupees” or “Indian Rupee” are to the legal currency of India and references to “AUD,” “Australian dollars” or “A$” are to the legal currency of the Commonwealth of Australia. References to “¢” are to US cents and references to “lb” are to the imperial pounds (mass) equivalent to 0.4536 kilograms. References to “tons” are to metric tons, a unit of mass equivalent to 1,000 kilograms or 2,204.6 lb. Unless otherwise indicated, the accompanying financial information for the Company has been prepared in accordance with US generally accepted accounting principles, or US GAAP, for the fiscal year ended March 31, 2008 and for the three-month periods ended June 30, 2007 and 2008. References to a particular “fiscal” year are to our fiscal year ended March 31 of that year. Our fiscal quarters end on June 30, September 30 and December 31. References to a year other than a “fiscal” year are to the calendar year ended December 31.

Special note regarding forward-looking statements

This report contains “forward-looking statements,” as defined in the safe harbor provisions of the US Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on our current expectations, assumptions, estimates and projections about our company and our industry. These forward-looking statements are subject to various risks and uncertainties. Generally, these forward-looking statements can be identified by the use of forward-looking terminology such as “anticipate,” “believe,” “estimate,” “expect,” “intend,” “will,” “project,” “seek,” “should” and similar expressions. These statements include, among other things, the discussions of our business strategy and expectations concerning our market position, future operations, margins, profitability, liquidity and capital resources. We caution you that reliance on any forward-looking statement involves risks and uncertainties, and that, although we believe that the assumptions on which our forward-looking statements are based are reasonable, any of those assumptions could prove to be inaccurate and, as a result, the forward-looking statements based on those assumptions could be materially incorrect. Factors which could cause these assumptions to be incorrect include, but are not limited to:

	•		a decline or volatility in the prices of or demand for copper, zinc or aluminum;
	•		events that could cause a decrease in our production of copper, zinc or aluminum;
	•		unavailability or increased costs of raw materials for our products;
	•		our actual economically recoverable copper ore, lead-zinc ore or bauxite reserves being lower than we have estimated;
	•		our ability to expand our business, effectively manage our growth or implement our strategy, including our planned entry into the commercial power business;
	•		our ability to retain our senior management team and hire and retain sufficiently skilled labor to support our operations;

	•		regulatory, legislative and judicial developments and future regulatory actions and conditions in our operating areas;
	•		increasing competition in the copper, zinc or aluminum industry;
	•		political or economic instability in India or around the region;
	•		worldwide economic and business conditions;
	•		our ability to successfully consummate strategic acquisitions;
	•		the outcome of outstanding litigation in which we are involved;
	•		our ability to maintain good relations with our trade unions and avoid strikes and lock-outs;
	•		any actions of our controlling shareholder, Vedanta;
	•		our business’ future capital requirements and the availability of financing on favorable terms;
	•		the continuation of tax holidays, exemptions and deferred tax schemes we enjoy;
	•		changes in tariffs, royalties, customs duties and government assistance; and
	•		terrorist attacks and other acts of violence, natural disasters and other environmental conditions and outbreaks of infectious diseases and other public health concerns in India, Asia and elsewhere.

These and other factors are more fully discussed in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in this report and in our other filings with the US Securities and Exchange Commission, or the SEC, including “Item 3. Key Information — D. Risk Factors,” “Item 5. Operating and Financial Review and Prospects” and elsewhere in our annual report on Form 20-F (Registration No. 001-33175). In light of these and other uncertainties, you should not conclude that we will necessarily achieve any plans, objectives or projected financial results referred to in any of the forward-looking statements. Except as required by law, we do not undertake to release revisions of any of these forward-looking statements to reflect future events or circumstances.

Index to Unaudited Condensed Consolidated Financial Statements

		Page(s)
Unaudited Condensed Consolidated Statements of Operations for the three-month periods ended June 30, 2007 and 2008			F-1
Unaudited Condensed Consolidated Balance Sheets as of March 31, 2008 and June 30, 2008			F-2
Unaudited Condensed Consolidated Statements of Cash Flows for the three-month periods ended June 30, 2007 and 2008			F-3
Unaudited Condensed Consolidated Statements of Changes in Shareholders’ Equity for the three-month periods ended June 30, 2007 and 2008			F-4
Notes to the Unaudited Condensed Consolidated Financial Statements			F-5

STERLITE INDUSTRIES (INDIA) LIMITED AND SUBSIDIARIES

										2008
		2007				2008				US dollars in
For the three-month period ended June 30,		Rs. in millions				Rs. in millions				millions (Note 2)
Sales
— External			65,226				60,548				1,410.4
— Related parties			1,223				1,983				46.2
Less : Excise duty			(5,400	)			(5,073	)			(118.2	)
Net sales			61,049				57,458				1,338.4
Other operating revenues			516				551				12.8
Total revenue			61,565				58,009				1,351.2
Cost of sales			(37,803	)			(40,627	)			(946.4	)
Selling and distribution expenses			(773	)			(865	)			(20.1	)
General and administration expenses			(1,120	)			(1,026	)			(23.9	)
Operating income			21,869				15,491				360.8
Interest and dividend income			951				2,624				61.1
Interest expense			(1,531	)			(965	)			(22.5	)
Net realized and unrealized investment gain			1,167				765				17.8
Income before income taxes, minority interests and equity in net income / (loss) of associate			22,456				17,915				417.2
Income taxes
— Current			(5,057	)			(3,726	)			(86.8	)
— Deferred			(589	)			276				6.4
Income after income taxes, before minority interests and equity in net income / (loss) of associate			16,810				14,465				336.8
Minority interests			(5,497	)			(4,411	)			(102.7	)
Equity in net income / (loss) of associate, net of taxes			536				(423	)			(9.8	)
Net income			11,849				9,631				224.3
Earnings per share			20.73				13.59				0.32
Weighted average number of equity shares used in computing earnings per share			571,681,224				708,494,411				708,494,411

     The accompanying notes are an integral part of these interim unaudited condensed consolidated financial statements.

STERLITE INDUSTRIES (INDIA) LIMITED AND SUBSIDIARIES

										June 30,
		March 31,				June 30,				2008
		2008				2008				US dollars
		Rs. in				Rs. in				in millions
As of		millions				millions				(Note 2)
ASSETS
Current assets
Cash and cash equivalents			12,363				8,791				204.8
Restricted — cash, deposits and investments			1,659				1,659				38.6
Short-term investments and deposits			154,364				162,457				3,784.2
Accounts receivable, net			15,652				13,399				312.1
Inventories			33,358				36,945				860.6
Deferred income taxes			421				320				7.5
Other current assets, net			14,138				19,571				456.1
Total current assets			231,955				243,142				5,663.9
Non-current assets
Long-term investments			1,123				1,137				26.5
Investment in associate			19,524				19,101				445.0
Deferred income taxes			374				327				7.6
Property, plant and equipment, net			121,582				126,573				2,948.3
Other non-current assets, net			1,621				1,590				37.0
Total non-current assets			144,224				148,728				3,464.4
Total assets			376,179				391,870				9,128.3
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities
Short-term and current portion of long-term debt			10,190				5,873				136.8
Accounts payable			44,811				42,684				994.3
Accrued expenses			1,921				2,490				58.0
Current income taxes payable			1,067				2,571				59.9
Deferred income taxes			765				1,420				33.1
Other current liabilities			7,305				12,672				295.2
Total current liabilities			66,059				67,710				1,577.3
Non-current liabilities
Long-term debt, net of current portion			9,949				9,242				215.3
Deferred income taxes			16,369				15,012				349.7
Other non-current liabilities			4,581				5,057				117.8
Total non-current liabilities			30,899				29,311				682.8
Total liabilities			96,958				97,021				2,260.1
Commitments and contingencies (Note 11)
Minority interests			58,098				62,325				1,451.8
Shareholders’ equity
Equity Shares — par value Rs.2 per equity share (925,000,000 shares authorized as of March 31, 2008 and June 30, 2008; 708,494,411 equity shares issued and outstanding as of March 31, 2008 and June 30, 2008 (Note 10)			1,417				1,417				33.0
Additional paid-in-capital			106,426				106,426				2,479.1
Retained earnings			113,598				123,229				2,870.5
Accumulated other comprehensive (losses) / income			(318	)			1,452				33.8
Total shareholders’ equity			221,123				232,524				5,416.4
Total liabilities and shareholders’ equity			376,179				391,870				9,128.3

     The accompanying notes are an integral part of these interim unaudited condensed consolidated financial statements.

STERLITE INDUSTRIES (INDIA) LIMITED AND SUBSIDIARIES

										2008
		2007				2008				US dollars in
For the three-month period ended June 30,		Rs. in millions				Rs. in millions				millions (Note 2)
Cash flows from operating activities
Net income			11,849				9,631				224.3
Adjustments to reconcile net income to net cash used in operating activities
Depreciation, depletion and amortization			1,668				1,960				45.7
Net realized and unrealized investment gains			(874	)			(765	)			(17.8	)
Profit on sale of property, plant and equipment			—				(17	)			(0.4	)
Equity in net (income) / loss of associate			(536	)			423				9.9
Deferred income taxes			589				(276	)			(6.4	)
Minority interests			5,497				4,411				102.7
Changes in assets and liabilities:			—
Accounts receivable, net			(477	)			2,279				53.1
Other current and non-current assets, net			2,232				1,044				24.2
Inventories			(10,043	)			(3,614	)			(84.2	)
Accounts payable and accrued expenses			3,390				632				14.7
Other current and non-current liabilities			5,902				6,213				144.7
Short-term investments			(48,313	)			(19,127	)			(445.3	)
Net cash (used in) / provided by operating activities			(29,116	)			2,794				65.2
Cash flows from investing activities
Purchases of property, plant and equipment			(4,526	)			(7,382	)			(172.0	)
Proceeds from sale of property, plant and equipment			4				64				1.5
Net changes in restricted — deposits and investments			(200	)			—				—
Advance to related party			—				(6,497	)			(151.3	)
Short-term deposits			—				11,799				274.8
Net cash (used in) / provided by investing activities			(4,722	)			(2,016	)			(47.0	)
Cash flows from financing activities
Proceeds from issuance of equity shares, net			80,465				—				—
Net changes in restricted cash			11				—				—
Proceeds from/(repayment of) short-term debt, net			5,459				(4,831	)			(112.5	)
Proceeds from long-term debt			—				79				1.8
Repayment of long-term debt			(4,374	)			(630	)			(14.7	)
Payment of dividends, including dividend tax			—				(63	)			(1.5	)
Net cash provided by / (used in) financing activities			81,561				(5,445	)			(126.9	)
Effect of exchange rate changes on cash and cash equivalents			(2	)			1,095				25.5
Net increase / (decrease) in cash and cash equivalents			47,721				(3,572	)			(83.2	)
Cash and cash equivalents at the beginning of the period			9,436				12,363				288.0
Cash and cash equivalents at the end of the period			57,157				8,791				204.8
Supplementary information:
Interest paid			639				658				15.3
Income taxes paid			2,476				3,185				74.2

     The accompanying notes are an integral part of these interim unaudited condensed consolidated financial statements.

STERLITE INDUSTRIES (INDIA) LIMITED AND SUBSIDIARIES

																		Accumulated
		Equity shares																other compre-				Compre-				Total
		No. of								Additional				Retained				hensive				hensive				Shareholders’
		shares				Par value				paid-in-capital				earnings				income /(loss)				income/(loss)				equity
Balance at April 1, 2007			558,494,411				1,117				26,220				70,463				(840)				—				96,960
Adoption of FIN 48															535												535
Shares issued			150,000,000				300				80,163																80,463
Net income															11,849								11,849				11,849
Unrealized gain on available-for-sale securities, net of tax of Rs. 17 million																			33				33				33
Foreign currency translation adjustment																			(8)				(8)				(8)
Unrealized loss on cash flow hedges, net of tax of Rs. 17 million																			(977)				(977)				(977)
Comprehensive income																							10,897
Balance at June 30, 2007			708,494,411				1,417				106,383				82,847				(1,792)								188,855

																		Accumulated other												Total
		Equity shares								Additional								comprehensive				Compre-				Total				US dollars in
		No. of								paid-in-				Retained				income				hensive				Shareholders’				Millions
		shares				Par value				capital				earnings				/(loss)				income/(loss)				equity				(Note 2)
Balance at April 1, 2008			708,494,411				1,417				106,426				113,598				(318)				—				221,123				5,150.8
Net income															9,631								9,631				9,631				224.3
Unrealized gain on available-for-sale securities, net of tax of Rs. 144 million ($3.4 million)																			280				280				280				6.5
Foreign currency translation adjustment																			665				665				665				15.5
Unrealized gain on cash flow hedges, net of tax of Rs. 111 million ($2.6 million)																			825				825				825				19.3
Comprehensive income																							11,401
Balance at June 30 , 2008			708,494,411				1,417				106,426				123,229				1,452								232,524				5,416.4
Balance at June 30, 2008 in US dollar in millions (Note 2)							33.0				2,479.1				2,870.5				33.8								5,416.4

     The accompanying notes are an integral part of these interim unaudited condensed consolidated financial statements

STERLITE INDUSTRIES (INDIA) LIMITED AND SUBSIDIARIES

1. Background and Operations

     Sterlite Industries (India) Limited and its consolidated subsidiaries (the “Company” or “Sterlite”) are engaged in non-ferrous mining and metals in India and Australia. Sterlite Industries (India) Limited (“SIIL”) was incorporated on September 8, 1975 under the laws of the Republic of India. Its shares are listed on National Stock Exchange and Bombay Stock Exchange in India. In June 2007, Sterlite completed its initial public offering of American Depositary Shares (“ADS”), each representing one equity share, and listed its ADSs on the New York Stock Exchange.

     SIIL is a majority-owned subsidiary of Twin Star Holdings Limited (“Twin Star”), which is in turn a wholly-owned subsidiary of Vedanta Resources plc (“Vedanta”), a public limited company incorporated in the United Kingdom and listed on the London Stock Exchange. Twin Star held 57.0% of SIIL’s equity as of June 30, 2008.

     The Company’s copper business is principally one of custom smelting and includes a smelter, refinery, phosphoric acid plant, sulphuric acid plant and copper rod plant at Tuticorin in Southern India, and a refinery and two copper rod plants at Silvassa in Western India. In addition, the Company owns and operates the Mt. Lyell copper mine in Tasmania, Australia through its subsidiary Copper Mines of Tasmania Pty Ltd (“CMT”), which provides a small percentage of the copper concentrate requirements for its smelter.

     The Company’s zinc business is owned and operated by Hindustan Zinc Limited (“HZL”). The Company has a 64.9% ownership interest in HZL, with the remaining interests owned by the Government of India (29.5%) and institutional and public shareholders (5.6%). HZL’s operations include three lead-zinc mines in Northwest India, three zinc smelters, one lead-zinc smelter and one lead smelter in Northwest India and one zinc smelter in Southeast India.

     The Company’s aluminum business is owned and operated by Bharat Aluminium Company Limited (“BALCO”), in which the Company has a 51.0% ownership interest and the remaining interest is owned by the Government of India. BALCO’s operations include bauxite mines, captive power plants and refining, smelting and fabrication facilities in Central India.

     The Company owns a 29.5% minority interest in Vedanta Aluminium Limited (formerly Vedanta Alumina Limited) (“Vedanta Aluminium”), a 70.5%-owned subsidiary of Vedanta. Vedanta Aluminium commenced construction of an aluminum refinery in the State of Orissa in Eastern India during fiscal 2004.

     The Company acquired 100% shareholding of Sterlite Energy Limited (“SEL”) during fiscal 2007. SEL is engaged in power generation business in India. SEL has commenced construction of the first phase of a pit-head thermal coal-based power facility in the state of Orissa in Eastern India.

2. Significant Accounting Policies

Basis of preparation

     The unaudited condensed consolidated financial statements of the Company are prepared in accordance with accounting principles generally accepted in the United States of America (“US GAAP”) which include industry practices. The unaudited condensed consolidated financial statements are presented in Indian Rupee (“Rs.”). Certain financial information that is normally included in annual financial statements, including certain financial statement notes, prepared in accordance with US GAAP, is not required for interim reporting purposes and has been condensed or omitted.

     The financial information with respect to the three-month periods ended June 30, 2007 and 2008 is unaudited and as of and for the year ended March 31, 2008 is derived from audited financial statements. The unaudited condensed consolidated financial statements have been prepared on the same basis as the audited financial statements. In the opinion of management, such unaudited financial information contains all adjustments, consisting of only normal recurring adjustments, necessary for a fair presentation of the results of such periods. The results of operations for the three-month period ended June 30, 2008 are not necessarily indicative of results to be expected for the full year.

Basis of consolidation

     The consolidated financial statements include the results of SIIL and all its wholly-owned subsidiaries and other subsidiaries in which a controlling interest is maintained.

     All significant inter-company balances and transactions, including unrealized profits arising from transactions between the subsidiaries, have been eliminated upon consolidation.

     Non-Indian subsidiaries have a functional currency (i.e., the currency in which activities are primarily conducted) of the country in which a subsidiary is domiciled. Foreign subsidiaries’ assets and liabilities are translated to Indian Rupee at year-end exchange rates, while revenues and expenses are translated at average exchange rates during the year. Adjustments that result from translating amounts in a subsidiary’s functional currency are reported in shareholders’ equity as a component of accumulated other comprehensive income. Minority interests in subsidiaries represent the minority shareholders’ proportionate share.

Convenience translation

     The accompanying unaudited condensed consolidated financial statements are presented in Indian Rupee, the functional currency of the Company. Solely for the convenience of the readers, the unaudited condensed consolidated financial statements as of and for the three months ended June 30, 2008 have been translated into US dollars (“$”) at the noon buying rates of $1.00 = Rs. 42.93 in the City of New York for cable transfers of Indian Rupee as certified for customs purposes by the Federal Reserve Bank of New York on June 30, 2008. No representation is made that the Indian Rupee amounts represent US dollar amounts or have been, could have been or could be converted into US dollars at such a rate or any other rate.

Income Taxes

     The Company adopted Financial Accounting Standards Board (“FASB”) Interpretation No. 48, Accounting for Uncertainty in Income Taxes — an interpretation of FASB Statement No. 109 (“FIN 48”), on April 1, 2007. FIN 48 provides specific guidance on the financial statement recognition, measurement, reporting and disclosure of uncertain tax positions taken or expected to be taken in a tax return. FIN 48 addresses the manner in which tax positions, either permanent or temporary, should be reflected in the financial statements.

     In accordance with the adoption of FIN 48, we evaluate our tax positions to determine if it is more likely than not that a tax position is sustainable, based on its technical merits. If a tax position does not meet the more likely than not standard, a liability is established. Additionally, for a position that is determined to, more likely than not, be sustainable, we measure the benefit at the highest cumulative probability of being realized and establish a liability for the remaining portion. A material change in our tax liabilities could have an impact on our results. The company recognizes potential interest and penalties related to unrecognized tax benefits in income tax expense.

Recently issued accounting pronouncements

     Statement of Financial Accounting Standards (“SFAS”) No. 157, “Fair Value Measurements”

     In September 2006, the FASB issued SFAS No. 157 “Fair Value Measurements” (“SFAS 157”). This Statement defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles (GAAP), and expands disclosures about fair value measurements. This Statement is effective for financial statements issued for fiscal years beginning after November 15, 2007, and interim periods within those fiscal years. The adoption of the standard did not have a material effect on the consolidated financial position or results of operation of the Company.

     In February 2008, the FASB issued FASB Staff Position No. 157-2, “Effective Date of FASB Statement No. 157” (“FSP 157-2”). FSP 157-2 delays the effective date of SFAS 157 for nonfinancial assets and nonfinancial liabilities, except for certain items that are recognized or disclosed at fair value in the financial statements on a recurring basis (at least annually). The Company is currently evaluating the impact of SFAS 157 on its consolidated financial position and results of operation for items within the scope of FSP 157-2, which will become effective beginning with the Company’s first quarter of 2009.

     SFAS No. 159, “The Fair Value Option for Financial Assets and Financial Liabilities — Including an amendment of FASB Statement No. 115.”

     In February 2007, the FASB issued SFAS No. 159, “The Fair Value Option for Financial Assets and Financial Liabilities — Including an amendment of FASB Statement No. 115” (“SFAS 159”). SFAS 159 permits entities to choose to measure many financial instruments and certain other items at fair value. The objective is to improve financial reporting by providing entities with the opportunity to mitigate volatility in reported earnings caused by measuring related assets and liabilities differently without having to apply complex hedge accounting provisions. This Statement is expected to expand the use of fair value measurement, which is consistent with the Board’s long-term measurement objectives for accounting for financial instruments. The fair value option established by this Statement permits all entities to choose to measure eligible items at fair value at specified election dates. This standard is effective for fiscal years beginning after November 15, 2007. The Company has elected not to value any of its financials assets and liabilities other than those required by standard prior to SFAS 159.

     SFAS No. 160, “Noncontrolling Interests in Consolidated Financial Statements — an amendment of ARB No. 51”

     In December 2007, the FASB issued SFAS No. 160, “Noncontrolling Interests in Consolidated Financial Statements — an amendment of ARB No. 51” (“SFAS 160”). SFAS 160 improves the relevance, comparability and transparency of the financial information that a reporting entity provides in its consolidated financial statements by establishing accounting and reporting standards for the noncontrolling interest in a subsidiary and for the deconsolidation of a subsidiary. This standard is effective for fiscal years beginning on or after December 15, 2008. The Company’s management is currently evaluating the impact on the adoption of SFAS 160 will have on the Company’s financial reporting and disclosures.

     SFAS No. 141(R), “Business Combination”

     In December 2007, the FASB issued SFAS No. 141 (Revised), “Business Combination” (“SFAS 141(R)”). SFAS 141(R) improves the relevance, representational faithfulness and comparability of the information that a reporting entity provides in its financial reports about a business combination and its effects. This standard is effective for fiscal years beginning on or after December 15, 2008. The Company’s management is currently evaluating the impact, if any, the adoption of SFAS 141(R) will have on the Company’s financial reporting and disclosures.

     SFAS No. 161, “Disclosures about Derivative Instruments and Hedging Activities — an amendment of FASB Statement No. 133”

     In March 2008, the FASB issued SFAS No. 161, “Disclosures about Derivative Instruments and Hedging Activities — an amendment of FASB Statement No. 133” (“SFAS 161”), which modifies and expands the disclosure requirements for derivative instruments and hedging activities. SFAS 161 requires that objectives for using derivative instruments be disclosed in terms of underlying risk and accounting designation and requires quantitative disclosures about fair value amounts and gains and losses on derivative instruments. It also requires disclosures about credit-related contingent features in derivative agreements. SFAS 161 is effective for financial statements issued for fiscal years and interim periods beginning after November 15, 2008, with early application encouraged. SFAS 161 encourages, but does not require, comparative disclosures for earlier periods at initial adoption. The Company’s management is currently evaluating the impact, if any, the adoption of SFAS 161 will have on the Company’s financial reporting and disclosures.

3. Interest and dividend Income

     Interest and dividend income include foreign currency gain/ (loss) on foreign currency investments.

4. Inventories

     Inventories consist of the following as of the date indicated:

										June 30,
		March 31,				June 30,				2008
		2008				2008				US dollars in
		Rs. in millions				Rs. in millions				millions
Finished goods			1,233				1,890				44.1
Work-in-progress			11,580				11,604				270.3
Raw materials			16,554				19,208				447.4
Stores and spares			3,991				4,243				98.8
Inventories			33,358				36,945				860.6

5. Accounts receivable, net

     Accounts receivable, net consists of the following as of the date indicated:

										June 30,
		March 31,				June 30,				2008
		2008				2008				US dollars in
		Rs. in millions				Rs. in millions				millions
Accounts receivable			13,352				11,392				265.4
Related party receivable			2,312				2,019				47.0
Total receivables			15,664				13,411				312.4
Allowances for doubtful accounts			(12	)			(12	)			(0.3	)
Accounts receivable, net			15,652				13,399				312.1

6. Other current and non-current assets, net

     Other current and non-current assets consists of the following as of the date indicated:

										June 30,
		March 31,				June 30,				2008
		2008				2008				US dollars in
		Rs. in millions				Rs. in millions				millions
Other current and non-current assets			12,029				10,934				254.8
Advances to related party			3,890				10,387				242.0
Total other current and non-current assets			15,919				21,321				496.8
Allowances for doubtful advances			(160	)			(160	)			(3.7	)
Other current and non-current assets, net			15,759				21,161				493.1

7. Short-term and long-term debt

     Short-term debt represents borrowings with an original maturity of less than one year. Long-term debt represents borrowings with an original maturity of greater than one year. Maturity distribution is based on contractual maturities or earlier dates at which debt is callable at the option of the holder or the Company. Interest rates on floating-rate debt are generally linked to benchmark rates.

   Working capital loans

     The Company has credit facilities from various banks for meeting working capital requirements, generally in the form of credit lines for establishing letters of credit, packing credit in foreign currency (“PCFC”), cash credit and issuing bank guarantees. Amounts due under working capital loans as of March 31, 2008 and June 30, 2008 were Rs. 6,119 million and Rs. 1,289 million ($30.0 million), respectively. The Rs. 1,289 million working capital loan due as of June 30, 2008 is a US dollar denominated PCFC loan. Interest on this facility is based on the London Inter-Bank Offer Rate (“LIBOR”) plus 95 basis points. These working capital loans are secured against the inventories and trade accounts receivables.

   Foreign currency loans

     The Company had a US dollar denominated unsecured term loan facility of $92.6 million, the purpose of which was to refinance foreign currency loans with various banks. This facility consisted of a Tranche A of $67.6 million which has been repaid in June 2007 and a Tranche B of $25.0 million repayable in September 2008. As per the loan agreement, in April, 2006, these loans were converted into Japanese yen loans amounting to Tranche A of Japanese yen 8,012.6 million and Tranche B of Japanese yen 2,862.5 million. Amounts due under this facility as of March 31, 2008 and June 30, 2008 were Rs. 1,147 million and Rs. 1,164 million ($27.1 million), respectively. Interest on this facility is based on Japanese yen LIBOR plus 44 basis points.

     The Company entered into an unsecured term loan facility consisting of Japanese yen 3,570 million and $19.7 million in September 2005, the purpose of which was to refinance foreign currency borrowings made in August 2002. This loan is to be repaid between August 2006 and August 2008 in five tranches. The first four tranches amounting to Japanese yen 2,856 million and $15.8 million repaid on or prior to June 30, 2008. The balances under this facility as of March 31, 2008 and June 30, 2008 were Rs. 443 million and Rs. 459 million ($10.7 million), respectively. Interest on Japanese yen facility is based on Japanese yen LIBOR plus 42 basis points and on the US dollar denominated facility is based on LIBOR plus 42 basis points.

   Term loans

     The Company secured two syndicated Indian rupee term loan facilities totaling Rs. 17,000 million, of which Rs. 15,904 million had been drawn down at an average interest rate of 7.2% per annum. The interest rate had been reset to 8.1%. These facilities are secured by a first charge on the movable and immovable properties, present and future tangible or intangible assets and other than current assets of BALCO. The first loan of Rs. 10,000 million is repayable in 12 quarterly installments commencing in January 2007, of which Rs. 6,839 million was paid by 30 June 2008; the second loan of Rs. 5,904 million is repayable in eight quarterly installments, due to commence in May 2009. However Rs. 2,088 million of repayments in respect of the second loan have been prepaid. As of March 31, 2008 and June 30, 2008, the balances were Rs. 7,599 million and Rs. 6,977 million ($162.5 million), respectively.

   Buyers’ credit

     As of June 30, 2008, the Company utilized extended credit terms relating to purchases of property, plant and equipment for its projects. As of March 31, 2008 and June 30, 2008, the balances were Rs. 3,047 million and Rs 3,405 million ($79.3 million), respectively. These loans bear interest at LIBOR plus 71 basis points. These are unsecured debts.

   Non-convertible debentures

     In April 2003 the Company had issued Rs. 1,000 million ($25.0 million) Indian Rupee denominated non-convertible debentures to the Life Insurance Corporation of India (“LIC”). The debentures were established in two tranches. Tranche A, which is in the amount of Rs. 400 million ($10.0 million), is due in April 2010 and Tranche B, which is in the amount of Rs. 600 million ($15.0 million), is due in April 2013. Interest rates are linked to annualized Indian Government Security rates. The applicable interest rates is 9.25% per annum. These debentures are secured by certain of SIIL’s immovable properties.

     Short-term and current portion of long-term debt consist of the following as of the date indicated:

										June 30,
		March 31,				June 30,				2008
		2008				2008				US dollars in
		Rs. in millions				Rs. in millions				millions
Short-term debt with banks and financial institutions			6,119				1,288				30.0
Current portion of long-term debt*			4,071				4,585				106.8
Short-term and current portion of long-term debt			10,190				5,873				136.8
Weighted average interest rate on short-term debts			4.6	%			6.4	%			6.4	%
Unused line of credit on short-term debts			46,393				36,025				839.2

     Long-term debt, net of current portion consists of the following as of the date indicated:

										June 30,
		March 31,				June 30,				2008
		2008				2008				US dollars in
		Rs. in millions				Rs. In millions				millions
Bank and financial institutions			12,293				12,054				280.8
Non-convertible debentures			1,000				1,000				23.3
Others*			727				773				18.0
Long-term debt			14,020				13,827				322.1
Less : Current portion of long-term debt			(4,071	)			(4,585	)			(106.8	)
Long-term debt, net of current portion			9,949				9,242				215.3

8. Business Combinations

a. Call option — HZL

     The Company’s wholly-owned subsidiary Sterlite Opportunities and Ventures Limited (“SOVL”) has the right to purchase all of the Government of India’s remaining shares in HZL at fair market value. As of March 31, 2008 and June 30, 2008, the Government of India’s holding in HZL was 29.5%. This call option is subject to the right of the Government of India to sell 3.5% of HZL to HZL employees. This call option is also subject to the Government of India’s right, prior to the exercise of this call option, to sell its shares in HZL through a public offer. With effect from April 11, 2007, SOVL has the right to purchase all of the Government of India’s

remaining shares in HZL. The option has no expiry date. The Company has not yet exercised the option. The Company continues to engage in talks with the Government of India to agree on a process to complete the transaction.

b. Call option — BALCO

     The Company purchased a 51% holding in BALCO from the Government of India on March 2, 2001. Under the terms of this purchase agreement for BALCO, the Company has a call option that allows it to purchase any remaining Government holding in BALCO at any point from March 2, 2004. The Company exercised this option on March 19, 2004. However, the Government of India has contested the purchase price and validity of the option. The Company sought an interim order from the High Court of Delhi to restrain the Government of India from transferring or disposing of its shareholding pending resolution of the dispute. However, the Court directed on August 7, 2006 that the parties attempt to settle the dispute by way of amicable negotiation and conciliation. As directed by the Court, mediation proceedings were conducted and the Company believes that the mediation process has been completed. The Company is now awaiting further communication from the Government of India on this matter.

c. Definitive agreement— Asarco

     On May 30, 2008, the Company and ASARCO LLC (“Asarco”), a mining, smelting and refining company based in Tucson, Arizona (United States of America) signed a definitive agreement for the Company to acquire substantially all the operating assets of Asarco for $2.6 billion in cash following an auction process. The agreement is subject to the approval of the US Bankruptcy Court for the Southern District of Texas, Corpus Christi Division.

9. Accumulated other comprehensive (loss) / income

     The components of accumulated other comprehensive losses consist of the following as of the date indicated:

										June 30,
		March 31,				June 30,				2008
		2008				2008				US dollars in
		Rs. in millions				Rs. in millions				millions
Unrealized gain on available-for-sale securities			58				338				7.9
Foreign currency translation adjustment			(72	)			593				13.8
Unrealized (loss) / gain on cash flow hedges			(304	)			521				12.1
Accumulated other comprehensive losses			(318	)			1,452				33.8

     The entire balance of unrealized loss on the cash flow hedges is expected to be recognized in the statement of operation within one year.

10. Shareholders’ equity

Issued shares

     SIIL’s issued equity share capital as of March 31, 2008 and June 30, 2008 was Rs. 1,417 million and Rs. 1,417 million ($33.0 million), consisting of 708,494,411 shares, respectively, of Rs. 2 each including 4,099,400 equity shares allotted as fully paid upon conversion of 50,000 foreign currency redeemable convertible bonds.

     SIIL issued an additional 150,000,000 equity share in June 2007, resulting in an increase in issued equity share capital from 558,494,411 shares to 708,494,411 shares.

     Retained earning includes among others balances of general reserve, debenture redemption reserve and preference share redemption reserve.

General reserves

     Under the Companies Act, a general reserve is created through an annual transfer of net income at a specified percentage in accordance with applicable regulations. The purpose of these transfers is to ensure that if a dividend distribution in a given year is more than 10.0% of the paid-up capital of the company for that year, then the total dividend distribution is less than the total

distributable results for that year. The balances in the standalone financial statements of SIIL’s general reserves as determined in accordance with applicable regulations were Rs. 3,602 million ($83.9 million) as of March 31, 2008 and June 30, 2008.

Debenture redemption reserve

     The Companies Act requires companies that issue debentures to create a debenture redemption reserve from annual profits until such debentures are redeemed. Companies are required to maintain a minimum proportion of outstanding redeemable debentures as a reserve. The amounts credited to the debenture redemption reserve may not be utilized by the Company except to redeem debentures. Retained earnings of the standalone financial statements of SIIL as of March 31, 2008 and June 30, 2008 include Rs. 146 million ($3.4 million) of debenture redemption reserve.

Preference share redemption reserve

     The Companies Act provides that companies that issue preference shares may redeem those shares from profits of the company which otherwise would be available for dividends or from proceeds of a new issue of shares made for the purpose of redemption of the preference shares. If there is a premium payable on redemption, the premium must be provided for, either by reducing the additional paid in capital (shares premium account) or net income, before the shares are redeemed.

     If profits are used to redeem preference shares, the value of the nominal amount of shares redeemed should be transferred from profits (retained earnings) to the capital redemption reserve account. This amount should then be utilized for the purpose of redemption of redeemable preference shares. This reserve can be used to issue fully paid-up bonus shares to the shareholders of the Company. Retained earnings of the standalone financial statements of SIIL includes Rs. 769 million ($17.9 million) of preference share redemption reserve as of March 31, 2008 and June 30, 2008.

Dividends

     Each equity share holder is entitled to dividends as and when the Company declares and pays dividends after obtaining shareholder approval. Dividends are paid in Indian Rupees. Remittance of dividends outside India is governed by Indian law on foreign exchange and is subject to applicable taxes. Equity dividends paid were nil for the year ended March 31, 2008 and for the three-month period ended June 30, 2008. Dividend distribution taxes on the equity dividends were nil for the year ended March 31, 2008 and for the three-month period ended June 30, 2008.

     Dividends are payable from the profits determined under Indian GAAP statutory standalone financial statements of SIIL and its subsidiaries. Under Indian law, a company is allowed to pay dividends in excess of 10.0% of its paid-up capital in any year from profits for that year only if it transfers a specified percentage of the profits of that year to reserves. The Company makes such transfers to general reserves.

11. Commitments, Contingencies and Guarantees

(a) Commitments and contingencies

(i) Commitments

     The Company has a number of continuing operational and financial commitments in the normal course of business including completion of the construction and expansion of certain assets.

•

Capital commitments

     Significant capital commitments of the Company as of June 30, 2008 amounted to Rs. 106,437 million ($2,479.3 million) and these are related to the capacity expansion projects including commitments amounting to Rs. 42,001 million ($978.4 million) for the Company’s new energy business.

•

Export obligations

     The Company has export obligations of Rs. 49,260 million ($1,147.4 million) over eight years on account of concessional rates received on import duties paid on capital goods under the Export Promotion Capital Goods Scheme enacted by the Government of India. If the Company is unable to meet these obligations, the Company’s liability would be Rs. 7,081 million ($164.9 million), reduced in proportion to actual exports. Due to a remote likelihood of the Company being unable to meet its export obligations, no loss is anticipated with respect to these obligations and hence no provision has been made in its unaudited condensed consolidated financial statements.

(ii) Contingencies

     The Company is from time to time subject to litigation and other legal proceedings. Certain operating subsidiaries of the Company have been named as parties to legal actions by third party claimants and by the Indian sales tax, excise and related tax authorities for additional sales tax, excise and indirect duties. These claims primarily relate either to the assessable values of sales and purchases or to incomplete documentation supporting the Company’s tax returns. The total claims related to these tax liabilities is Rs. 4,116 million ($95.9 million). The management of the Company has evaluated these contingencies and hence has recorded Rs. 659 million ($15.4 million) as current liabilities as of June 30, 2008.

     Claims by third parties amounted to Rs. 4,897 million ($114.1 million) as of June 30, 2008. No liability has been recorded against these claims, based on management’s estimate that none of these claims would become obligations of the Company. The Company intends to vigorously defend these claims. Although the results of legal actions cannot be predicted with certainty, it is the opinion of management, after taking appropriate legal advice, that the likelihood of these claims becoming obligations of the Company is remote and hence the resolution of these actions will not have a material adverse effect, if any, on the Company’s business, financial condition or results of operations.

     Therefore, the Company has not recorded any additional liability beyond what is stated above in relation to litigation matters in the accompanying consolidated financial statements.

(b) Guarantees and Put Option

     The Company has given guarantees on the issuance of customs and excise duty bonds amounting to Rs. 678 million ($15.8 million) for import of goods including, capital equipment, at concessional rates of duty. The Company does not anticipate any liability on these guarantees.

     The Company has provided guarantees on behalf of IFL for its loan obligations to the extent of Rs. 1,820 million ($42.4 million) and the outstanding amounts against these guarantees as of June 30, 2008 was Rs. 1,592 million ($37.1 million). For loan obligations of Rs. 1,146 million ($26.7 million) of IFL guaranteed by the Company, the Company has also granted a put option to a bank under which the bank may require the Company to repurchase the loan in lieu of looking to the Company’s guarantee.

     The Company reviewed its liabilities under the guarantees and the put option taking into consideration the financial position of IFL and estimated that the fair value of the guarantees as of March 31, 2006 was Rs. 886 million. The Company recognized a liability of Rs. 784 million for the guarantees and the put option in fiscal 2006.

     In January 2008, an agreement was entered between The Madras Aluminium Company Limited (“MALCO”), a company under common control of Vedanta, and a third party for the disposal of MALCO’s entire interest in IFL. The transaction is expected to be completed in this financial year after obtaining necessary statutory approvals. In connection with this agreement, the Company is obligated to settle guarantees issued to banks. As such the Company, during fiscal 2008 revised its liability to Rs.1,412 million to represent the expected net cash outflow at completion. No further provision during the three-month period ended June 30, 2008 was deemed necessary.

     The Company has issued a corporate guarantee of Rs. 7,000 million ($163.1 million) on behalf of Vedanta Aluminium for obtaining credit facilities. The Company has also issued a corporate guarantee of Rs. 13,180 million ($307.0 million) for importing capital equipment at concessional rates of duty under the Export Promotion Capital Goods scheme enacted by the Government of India and Rs. 269 million ($6.3 million) for Raw Material imports. Vedanta Aluminium is obligated to export goods worth eight times the value of concessions enjoyed in a period of eight years following the date of import, failing which the Company is liable to pay the dues to the government. With respect to the corporate guarantee of Rs. 7,000 million ($163.1 million), Vedanta Aluminium has issued a counter guarantee to the Company indemnifying the Company for any liability on such guarantee. As of June 30, 2008, management determined that the Company will not have to fulfill its obligation.

     The Company has given a bank guarantee amounting to Australian Dollar 5.0 million (Rs. 207 million or $4.8 million) as of June 30, 2008 in favor of the Ministry for Economic Development, Energy and Resources as a security against rehabilitation liability on behalf of CMT. The same guarantee is backed by the issuance of a corporate guarantee of Rs. 320 million ($7.5 million). These liabilities are fully recognized in the consolidated financial statements of the Company. The management of the Company does not anticipate any liability on these guarantees.

     The Company has given bank indemnity guarantees amounting to Australian Dollar 2.9 million (Rs. 95 million or $2.2 million) as of June 30, 2008 in favor of the State Government of Queensland, Australia as a security against rehabilitation liabilities that are expected to occur at the closure of the mine. The environmental liability is fully recognized in the financial statements of the Company. The management of the Company does not anticipate any liability on these guarantees.

     The Company has given performance bank guarantees amounting to Rs. 3,279 million ($76.4 million) as of June 30, 2008. These guarantees are issued in the normal course of business while bidding for supply contracts or in lieu of advances received from customers. The guarantees have varying maturity dates normally ranging from six months to three years. These are contractual guarantees and are enforceable if the terms and conditions of the contracts are not met and the maximum liability on these contracts is the amount mentioned above. The management of the Company does not anticipate any liability on these guarantees.

     The Company has given bank guarantees for securing supplies of materials and services in the normal course of business. The value of these guarantees as of June 30, 2008 is Rs. 1,412 million ($32.9 million). The Company has also issued bank guarantees in the normal course of business for an aggregate value of Rs. 550 million ($12.8 million) for litigations, against provisional valuation and for other liabilities. The management of the Company does not expect any liability on these guarantees.

     The Company’s outstanding guarantees and put option cover obligations aggregating Rs. 26,368 million ($614.2 million) as of June 30, 2008. The Company estimates that the likelihood of these claims becoming obligations of the Company is remote and as such no provision has been made in the financial statements for these guarantees and put option.

     12. Income Taxes

     The following are the details of tax expense charged to statements of operations for the periods indicated:

		Three months ended
										June 30, 2008
		June 30, 2007				June 30, 2008				US dollars in
		Rs. in millions				Rs. in millions				millions
Current tax:
Indian income tax			4,936				3,665				85.4
Foreign income tax			121				61				1.4
Total current tax			5,057				3,726				86.8
Deferred tax:
Indian income tax			591				(326	)			(7.6	)
Foreign income tax			(2	)			50				1.2
Total deferred tax			589				(276	)			(6.4	)
Income taxes for the period			5,646				3,450				(80.4	)
Effective tax rate			25.1	%			19.3	%			19.3	%

     The following are the details of the deferred tax assets and liabilities as of the dates indicated:

						June 30,				June 30, 2008
		March 31, 2008				2008				US dollars in
		Rs. in millions				Rs. in millions				millions
Deferred tax assets
Current			421				320				7.5
Non-current			374				327				7.6
Total			795				647				15.1
Deferred tax liabilities
Current			765				1,420				33.1
Non-current			16,369				15,012				349.7
Total			17,134				16,432				382.8

     The Company’s income tax provision from continuing operations for the three-month period ended June 30, 2008 was Rs. 3,450 million ($80.4 million). The effective tax rate for the three-month period ended June 30, 2008 was 19.3% and the difference between the statutory tax rate of 34.0% and the effective tax rate was primarily due to tax holidays and exemptions available to Indian companies.

     Effective April 1, 2007, the company adopted the provisions of FIN 48. This Interpretation clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements in accordance with SFAS No. 109, “Accounting for Income Taxes” and prescribes a recognition threshold of more-likely-than-not to be sustained upon examination. As a result of the implementation of FIN 48, the Company has to recognize a Rs. 535 million decrease in the liability for unrecognized tax benefits related to tax positions taken in prior periods, which was accounted for as an increase to the April 1, 2007 balance of retained earnings.

     In addition, the Company has accrued interest and necessary penalties, where applicable, of Rs. 40 million related to unrecognized tax positions in provision for income taxes.

13. Earnings Per Share (“EPS”)

     The following are the EPS for the period indicated:

		Three months ended
										June 30, 2008
		June 30, 2007				June 30, 2008				US dollars in
		Rs. in millions				Rs. in millions				millions
Net income			11,849				9,631				224.3
Weighted average number of ordinary shares for basic earnings per share			571,681,224				708,494,411				708,494,411
Earnings from per share			20.73				13.59				0.32

14. Segment Information

     The Company is in the business of non-ferrous mining and metals in India and Australia. The Company has four reportable segments: copper, zinc, aluminum and corporate and others. The management of the Company is organized by its main products: copper, zinc and aluminum. Each of the reported segment derives its revenues from these main products and hence these have been identified as reportable segments by the Company’s Chief Operating Decision Maker (CODM). Segment profit amounts are evaluated regularly by the Company’s Managing Director and CEO who has been identified as its CODM in deciding how to allocate resources and in assessing performance.

     Copper

     The copper business is principally one of custom smelting and includes a smelter, refinery, phosphoric acid plant, sulphuric acid plant and copper rod plant at Tuticorin in Southern India and a refinery and two copper rod plants at Silvassa in Western India. The Company obtains a small quantity of copper concentrate from the Mt. Lyell copper mine in Tasmania, Australia, owned by CMT.

     Zinc

     The zinc business is owned and operated by HZL, India’s leading zinc producer in the Indian zinc market. The Company has a 64.9% ownership interest in HZL, with the remainder owned by the Government of India (29.5%) and institutional and public shareholders (5.6%). HZL’s operations include three zinc smelters, one lead-zinc smelter and one lead smelter in Northwest India, one zinc smelter in Southeast India and three lead-zinc mines in Northwest India.

     Aluminum

     The aluminum business is owned and operated by BALCO, in which the Company has a 51.0% ownership interest. The remainder of BALCO is owned by the Government of India. BALCO’s operations include bauxite mines, captive power plants, and refining, smelting and fabrication facilities in Central India.

     Corporate and others

     The operating segment “Corporate and others” is primarily commercial power generation business and other corporate activities.

Business segments

     The operating segments reported are the segments of the Company for which separate financial information is available. Segment profit amounts are evaluated regularly by the Company’s managing director and CEO who has been identified as its chief operating decision maker in deciding how to allocate resources and in assessing performance. The following table presents revenue and profit information and certain asset and liability information regarding the Company’s business segments for the three months ended June 30, 2007 and 2008.

For the three-month period ended June 30, 2007

														Corporate
Rs. in millions		Copper				Zinc				Aluminium				and others				Elimination				Total
Net sales to external customers			30,835				19,631				10,515				68				—				61,049
Inter-segment sales											37								(37	)			—
Segment sales			30,835				19,631				10,552				68				(37	)			61,049
Segment profit			3,578				15,815				4,074				70				—				23,537
Depreciation, depletion and amortization			(407	)			(612	)			(600	)			(49	)			—				(1,668	)
Operating income			3,171				15,203				3,474				21				—				21,869
Interest and dividend income																							951
Interest expense																							(1,531	)
Net realized and unrealized investment gain																							1,167
Income before income taxes, minority interests and equity in net income of associate																							22,456
Income taxes																							(5,646	)
Income after income taxes, before minority interests and equity in net income of associate																							16,810
Minority interests																							(5,497	)
Equity in net income of associate, net of taxes																							536
Net income																							11,849

For the three-month period ended June 30, 2008

																						Total				US
																						Rs.				dollars
														Corporate								in				in
Rs. in millions		Copper				Zinc				Aluminium				and others				Elimination				millions				millions
Net sales to external customers			29,394				16,184				11,631				249				—				57,458				1,338.4
Inter-segment sales			—				—				43				—				(43	)			—				—
Segment sales			29,394				16,184				11,674				249				(43	)			57,458				1,338.4
Segment profit			2,951				9,719				4,549				232				—				17,451				406.5
Depreciation, depletion and amortization			(432	)			(676	)			(709	)			(143	)			—				(1,960	)			(45.7	)
Operating income			2,519				9,043				3,840				89				—				15,491				360.8
Interest and dividend income																							2,624				61.1
Interest expense																							(965	)			(22.5	)
Net realized and unrealized investment gain																							765				17.8
Income before income taxes, minority interests and equity in net loss of associate																							17,915				417.2
Income taxes																							(3,450	)			(80.4	)
Income after income taxes, before minority interests and equity in net loss of associate																							14,465				336.8
Minority interests																							(4,411	)			(102.7	)
Equity in net loss of associate, net of taxes																							(423	)			(9.9	)
Net income																							9,631				224.2
Assets
Segment assets			148,997				142,793				56,018				24,961				—				372,769				8,683.3
Investment in associate															19,101				—				19,101				445.0
Total assets			148,997				142,793				56,018				44,062				—				391,870				9,128.3
Additions to Property, plant and equipment			630				2,136				1,087				3,146				—				6,999				163.0

15. Fair Value Measurements

     SFAS 157 defines and establishes a framework for measuring fair value and expands disclosures about fair value measurements. In accordance with SFAS 157, the Company has categorized its financial assets and liabilities as of June 30, 2008, based on the priority of the inputs to the valuation technique, into a three-level fair value hierarchy as set forth below.

		Rs. in millions																US dollars in millions
		Quoted
		price in																Quoted
		active																price in
		market				Significant												active				Significant
		for				other												market for				other
		identical				observable				Significant								identical				observable				Significant
		assets				inputs				unobservable								assets				inputs				unobservable
		(Level 1)				(Level 2)				inputs (Level 3)				Total				(Level 1)				(Level 2)				inputs (Level 3)				Total
Financials Asset
Trading Securities(1)			163,751				—				—				163,751				3,814.4				—				—				3,814.4
Available for sale securities(2)			153				—				—				153				3.6				—				—				3.6
Derivative(3)			675				1,513				—				2,188				15.7				35.2				—				51.0
Total			164,579				1,513				—				166,092				3,833.7				35.2				—				3,869.0
Financials Liability
Long-term debts(4)			—				489				—				489				—				11.4				—				11.4
Derivative(5)			190				676				—				866				4.4				15.7				—				20.1
Total			190				1,165				—				1,355				4.4				27.1				—				31.5