Sterlite Industries (India) Limited - Sterlite Industries India Ltd.

• India’s economic growth and proximity to other growing economies. India is one of the fastest growing large economies in the world
with a real gross domestic product growth of 6.7% in fiscal 2009 and an expected growth in real gross domestic product of 7.0% in
fiscal 2010, according to the Government of India, Economic Survey (2008 to 2009). That growth has been fueled in significant part
by domestic demand, with exports accounting for only approximately 23% of India’s real gross domestic product in fiscal 2009,
according to the Government of India’s Ministry of Statistics and Programme Implementation. In addition, the Government of India
plans to spend approximately $514 billion on infrastructure between 2007 and 2012, including approximately $167 billion on the
power segment, according to the Government of India’s Eleventh Five-Year Plan (2007-2012) (exchange rate used in the plan for
calculating infrastructure and power segments spending was Rs. 40 = $1.00). As such, we believe that our focus on the metals and
power segments will allow us to directly benefit from demand in India and from the other growing economies in China, Southeast Asia
and the Middle East.
• India’s large and inexpensive labor and talent pools. India has, compared to other industrialized nations, low labor costs as a result of
its large and skilled labor pool and the availability of many well-educated professionals.
Strong pipeline of growth projects
We possess a strong portfolio of greenfield and brownfield projects that we intend to pursue:
• Zinc segment: HZL has Rs. 28,800 million ($566.1 million) of expansion projects to increase its total lead-zinc capacity to 1,065,000
tpa with fully integrated mining and captive power generation capacities. These projects include:
• establishing two brownfield smelters which are expected to increase the production capacities of zinc and lead by
approximately 210,000 tons and 100,000 tons, respectively, at Rajpura Dariba in the State of Rajasthan, both of which are
expected to be completed by mid-2010;
• setting up an associated captive power plant with a capacity of 160 MW at Rajpura Dariba, which is expected to be completed
by mid-2010;
• expanding ore production capacity at the Rampura Agucha mine from approximately 5.0 million tpa to 6.0 million tpa, which
is scheduled for completion in mid-2010, and at the Sindesar Khurd mine from approximately 0.3 million tpa to 1.5 million
tpa, which is scheduled to be progressively completed from mid-2010. The ramp portal connecting the Sindesar Khurd mine
surface to the ore body has been completed and resources have been mobilized to achieve accelerated mine development;
• HZL is expected to start mining activity at the Kayar mine progressively from mid-2010, with the mine expected to have a
production capacity of 360,000 tpa; and
• increasing silver production from the current levels of approximately 105 tpa to approximately 500 tpa, primarily from the
Sindesar Khurd mine where silver occurs at approximately 200 parts per million, or ppm.
• Aluminum segment: Our aluminum segment projects are being undertaken both at our subsidiary, BALCO, and by Vedanta
Aluminium, a 70.5%-owned subsidiary of Vedanta in which we have 29.5% ownership interest:
• In order to enhance aluminum production capacity to 1.0 million tons, BALCO entered into a memorandum of understanding
with the State Government of Chhattisgarh on August 8, 2007, for a potential investment to build an aluminum smelter with a
capacity of 650,000 tpa at Chhattisgarh, at an estimated cost of Rs. 81,000 million ($1,592.3 million). BALCO has
commenced the implementation process of the first phase of expansion for setting up a 325,000 tpa aluminum smelter which
uses pre-baked technology from the Guiyang Aluminium — Magnesium Design & Research Institute, or GAMI, of China.
The first production stream from the 325,000 tpa aluminum smelter is expected in October 2010 and the target date of
completion is by September 2011. In addition, BALCO is building a 1,200 MW coal-based captive power plant in
Chhattisgarh at an estimated cost of Rs. 46,500 million ($914.1 million). The first phase of the power plant is expected to be
commissioned by June 2010 and the second phase is expected to be completed by September 2011.
• Vedanta Aluminium is building a greenfield 500,000 tpa aluminum smelter, together with an associated 1,215 MW captive
power plant, in Jharsuguda in the State of Orissa, in two phases of 250,000 tpa each at an estimated project cost of
Rs. 95,583 million ($1,879.0 million). Commissioning of the first phase commenced in May 2008, six months ahead of
schedule, and was fully commissioned in May 2009. The second phase is expected to be progressively commissioned from
June 2009 through the end of fiscal 2010, subject to the receipt of governmental approvals. The associated 1,215 MW thermal
coal-based captive power plant will consist of nine units of 135 MW each, five of which have been commissioned as part of
the first phase. The commissioning of the captive power plant units is scheduled to meet the power requirements of the new
Jharsuguda smelter and all other power requirements of the facility. In addition, Vedanta Aluminium is spending an estimated
Rs. 116,800 million ($2,296.0 million) to construct a second 1,250,000 tpa aluminum smelter in Jharsuguda which is expected
to be progressive commissioned from March 2010 and to be completed by September 2012.
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