Essel Propack 's Global Sales Record a Growth of 11% in The First Quarter Ended March 31, 2006

Global sales – Rs. 2,121 Million

EBIDT – Rs. 513 Million

Net profit – Rs. 187 Million

Mumbai, March 26, 2006 : Essel Propack, the global leader in laminated tubes, recorded a growth of 11% in its consolidated revenues during the First Quarter of 2006 over the corresponding period of last year. The Net Sales during the quarter under consideration touched Rs. 2,121 Million with a PAT of Rs. 187 Million.

Speaking of the First Quarter results, Ashok Goel, the Vice Chairman & Managing Director stated in Mumbai, “Results for the first quarter are in line with our expectations. The seasonal and cyclical swing in volumes & revenue has been anticipated. This is built into our internal projections for the current year.”

The turnaround operations at the acquired units of Arista Tubes, UK, and Essel Propack (UK), formerly Telcon Packaging, are on schedule. The expansion project at Arista, UK, is expected to be completed by the end of April 2006. These units are expected to move towards breakeven levels by June 2006. These units will further contribute to the profitability and margin improvement of the Company from Q3 2006. The start-up units of Russia and Mexico are going through a stabilization and volumes ramp-up mode. Operating costs for the Q1 2005 and Q1 2006 are not comparable because the Q1 2006 results include the operating costs of new Nalagarh plant (Himachal Pradesh, India), Essel Propack (UK), Russia, Mexico and the new US expansion which were not a part of the Q1 2005 results. The coming months are expected to show higher volumes and increased revenues from these new investments. Finance cost and depreciation are higher due to increased loans taken for Nalagarh project, for capacity expansion in USA, Arista (UK) expansion and Essel Propack (UK) acquisition. Also other income such as exchange gains in Q1 2005 has not occurred in Q1 2006. These too have impacted the profits in Q1 2006.

On the short term outlook, Ashok Goel said, “Going forward in the second half of 2006, the loss making operations in Europe are expected to turn around. This should help in the improvement of the margins.” To sustain a double-digit growth, the Company has rolled out a multi-pronged approach. Mini-tubes will spearhead the Company’s penetration into pharmaceutical sector. At the same time, Company is broadening its customer base for laminated tubes by targeting toiletries, haircare and food sectors. Plastic tube is another focus area for the Company aimed at cosmetics industry. Other than the Indian and European markets, the Company has unveiled plans for foray into US market with plastic tubes by setting up a new facility. On the long term perspectives of the Company, Ashok Goel said, “Our earnings guidance remains unaltered for the year 2006. The revenues are expected to grow at 15-18% levels over 2005 and PAT is expected to grow along similar lines.”

On March 29, 2006, Essel Propack had announced its foray into Medical Devices business. Then the Company was in the process of acquiring two companies namely Tacpro Inc., USA, and Avalon Medical Services, Singapore. The entire process of acquisition was completed on April 11, 2006. Revenues amounting to Rs. 360 Million is expected from the Medical Devices business during the period April 12, 2006, to December 31, 2006.

Essel Propack, the largest speciality packaging company in the world, is promoted by Essel Group. Essel Propack, head quartered in India, manufacturers laminated and plastic tubes. The Company provides packaging solutions to toothpaste, pharmaceuticals, cosmetics, food and Industrial sectors all over the world. Recently, the Company forayed into Medical Devices business. The Company has state-of-the-art manufacturing facilities in 14 countries with 24 plants across the globe. Essel Propack’s stock is listed on the Bombay Stock Exchange and the National Stock Exchange.

Press contacts : Mumbai : Ramdas Warrier – 98209 04179;

Delhi : Chetan Saxena @ 98113 23282

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