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INTRODUCTION

MEANING OF EXCHANGE RATE


When a domestic currency is exchanged for a foreign currency at a particular rate, it is called the exchange rate of a currency or currency rate. For example, if one U.S. dollar is exchanged for Rs.48 of Indian currency, it is the exchange rate of rupee for dollar. It is only on the basis of exchange rate that international trade take place. It enables the selling country to quote the price of the commodity or goods in terms of foreign currency.

IMPORTANCE OF EXCHANGE RATE It helps a country to know the value of goods it has exported in terms of

foreign currency. A country can plan its imports according to the availability of foreign

exchange at its disposal. When a currency borrows in foreign market, in terms of foreign currency, it

is called foreign debt. To repay this foreign debt, the country can plan its exports. A country can also earn foreign exchange by doing services or by attracting

more foreign tourists. This enables the country to earn more foreign exchange. A country can change the course of its foreign trade by exporting to that

country whose currency value is higher. Even after earning foreign exchange, it is necessary for a country to

maintain its foreign exchange reserve in that currency whose value is maintained or appreciating. So, by knowing the exchange rate of different currencies, the country can maintain its foreign exchange reserve in a valuable currency.

FOREIGN EXCHANGE MARKET Foreign exchange market refers to various categories of sellers and buyers of foreign currency who deal in different foreign currencies for the purpose of investment and for earning short-term profits. It is the commercial banks who mainly form the major part of foreign exchange market. In addition to this, we have countries who borrow and lend foreign currencies. There are also brokers who buy and sell foreign currencies for speculative gain. Traders are also dealing in the foreign exchange market for the purpose of making arrangements for their purchases. The interest rate prevailing for different currencies plays a major role in the foreign exchange market. We have LIBOR and NIBOR, the leading interest rates in the foreign exchange market. TRANSACTIONS IN FOREIGN EXCHANGE MARKET The price quoted for currencies in the markets of two types. 1. 2. Spot market Forward market

Spot market transactions are valid for 48 hours and the price refers to the current transactions. Forward market refers to the price quoted for future date which may be ranging from 1 month to 6 months. The maximum period for a forward current is six months. The forward market price may be at par, at discount, or at a premium. At par price refers to spot market price. That is, there is no change between the exchange rate of spot market with forward market. In the case of forward market price at discount, the forward market exchange rate will be lesser than spot market. In the case of premium, the forward market rate will be in excess of spot market rate. Example: Spot market price of one U.S. dollar = Rs. 48/2

Direct quotation and indirect quotation: In foreign exchange quotations, the price of a currency given in terms of another currency can be classified into two types. For example, we can quote in India the price of U.S. dollar in terms of Indian rupee or the price of Indian rupees in terms of U.S. dollar. A direct quote is the price of one unit of foreign currency in terms of Indian rupee. Example: one U.S. dollar = Rs.58/Indirect quote is the price of one unit of domestic currency in terms of foreign currency. So, Re. 1 = 2 cents or 0.02 dollar (one dollar is equal to 100 cents). In other words, direct and indirect quote of prices are reciprocals and in terms of mathematical expression, the direct quote is inversely proportional to indirect quote.

Cross exchange rate: When the exchange rate of two different currencies belonging to two different countries are determined through the exchange rate of domestic currency, it is called cross exchange. Example: One U.S. dollar = Rs.48/One Pound sterling = Rs.60/Now, we can arrive at the exchange rate of 1Pound sterling in terms of US dollar, as 1 Pound sterling = 1.25 US dollar.

INDUSTRY PROFILE
PAPER INDUSTRY IN INDIA

Paper industry in India is the 15th largest paper industry in the world. It provides employment to nearly 1.5 million people and contributes Rs.25 billion to the government's kitty. The government regards the paper industry as one of the 35 high priority industries of the country. Paper industry is primarily dependent upon forest-based raw materials. The first paper mill in India was set up at Sreerampur, West Bengal, in the year 1812. It was based on grasses and jute as raw material. Large scale mechanized technology of papermaking was introduced in India in early 1905. Since then the raw material for the paper industry underwent a number of changes and over a period of time, besides wood and bamboo, other non-conventional raw materials have been developed for use in the papermaking. The Indian pulp and paper industry at present is very well developed and established. Now, the paper industry is categorized as forest-based, agro-based and others (waste paper, secondary fibre, bast fibers and market pulp). In 1951, there were 17 paper mills, and today there are about 515 units engaged in the manufacture of paper and paperboards and newsprint in India. The pulp & paper industries in India have been categorized into large-scale and small-scale. Those paper industries, which have capacity above 24,000 tonnes per annum are designated as large-scale paper industries. India is self-sufficient in manufacture of most varieties of paper and paperboards. Import is confined only to certain specialty papers. To meet part of its raw material needs the industry has to rely on imported wood pulp and waste paper.
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Indian paper industry has been de-licensed under the Industries (Development & Regulation) Act, 1951 with effect from 17th July, 1997. The interested entrepreneurs are now required to file an Industrial Entrepreneurs' Memorandum (IEM) with the Secretariat for Industrial Assistance (SIA) for setting up a new paper unit or substantial expansion of the existing unit in permissible locations. Foreign Direct Investment (FDI) up to 100% is allowed on automatic route on all activities except those requiring industrial licenses where prior governmental approval is required. Growth of paper industry in India has been constrained due to high cost of production caused by inadequate availability and high cost of raw materials, power cost and concentration of mills in one particular area. Government has taken several policy measures to remove the bottlenecks of availability of raw materials and infrastructure development. For example, to overcome short supply of raw materials, duty on pulp and waste paper and wood logs/chips has been reduced. Following measures need to be taken to make Indian paper industry more competitive: Improvements of key ports, roads and railways and communication facilities. Revision of forest policy is required for wood based paper industry so that plantation can be raised by industry, cooperatives of farmers, and state government. Degraded forest land should be made available to the industry for raising plantations. Import duty on waste paper should be reduced. Duty free imports of new & second hand machinery/equipment should be allowed for technology up gradation. Outlook Outlook for paper industry in India looks extremely positive as the demand for upstream market of paper products, like, tissue paper, tea bags, filter paper, light weight online coated paper, medical grade coated paper, etc., is growing up.

COMPANY PROFILE
ABOUT US Tamil Nadu Newsprint and Papers Limited (TNPL) was established by the Government of Tami Nadu during early eighties to produce Newsprint and Printing & Writing Paper using bagasse, a sugarcane residue, as primary raw material. The Company commenced production in the year 1984 with an initial capacity of 90,000 tonnes per annum. Over the years, the production capacity has been increased to 2,45,000 tonnes per annum and the Company has emerged as the largest bagasse based Paper Mill in the world consuming about one million tones of bagasse every year. The Company is in the process of implementing the Mill Expansion Plan for increasing the capacity to 4,00,000 tonnes per annum from July 2010.

TNPL exports about 1/5th of its production to more than 30 countries. Manufacturing of quality paper for the past two and half decades from bagasse is
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an index of the companys technological competence. A strong record in adopting minimum impact best process technology, responsible waste management, reduced pollution load and commitment to the corporate social responsibility make the company one of the most environmentally compliant paper mills in the world.

CORPORATE OFFICE

BOARD OF DIRECTORS Thiru. Rajeev Ranjan, I.A.S Thiru. V. R. Mehta Thiru. Md. Nasimuddin, I.A.S Thiru. V. Narayanan Thiru. A. Velliangiri Thiru. R. Thiagarajan, I.A.S Thiru. Dayanand Kataria I.A.S Thiru. D. Krishnan Chairman Director Managing Director Director Deputy Managing Director Director Director Director

AUDIT COMMITTEE Thiru. V. Narayanan Thiru. V. R. Mehta Thiru. R .R. Bhandari Thiru. N. Kumaravelu Thiru. D.Krishnan Chairman of Audit Committee Director Director Director Director
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SHARE HOLDERS / INVESTORS GRIEVANCES COMMITTEE Thiru. R .R. Bhandari Thiru. N. Kumaravelu Thiru. D.Krishnan Chairman of Shareholders' / Investors' Grievances Committee Director Director

SENIOR EXECUTIVES Thiru. T. Francis Devotta Thiru. S. Krishnamurthy Thiru. R.V. Krishnan Thiru. R. Mani Thiru. R.N. Manickam Thiru. C. Rajagopalan Thiru. P. Ramakrishnan General Manager (Human Resources) General Manager (Marketing) General Manager (Paper) General Manager (Operations) General Manager (Electrical & Instrumentation) General Manager (Materials & Logistics) General Manager (Operations) - Cement Plant

CODE OF CONDUCT Code of Conduct for Members of the Board TNPLs philosophy on Corporate Governance endeavours to achieve the highest levels of transparency, integrity and equity in all its operations and its dealings with all stakeholders. This commitment to ethical and lawful business conduct is a non negotiable foundation that the Company and all its officers stand for. Consistent with this commitment and in compliance with regulatory requirements, this Code of Conduct has been formulated. The code is applicable to the members of the Board of Directors of the company.
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I. Honest and Ethical Conduct The directors shall act in accordance with the highest standards of personal and professional integrity, honesty and ethical conduct. II. Disclosure of Interest in Material Transactions The directors shall disclose the nature of his / her interest or concern in any material transaction made or proposed to be made on behalf of the Company. Such disclosure shall be made to the Company Secretary as soon as it comes to his / her knowledge. A disclosure of interest under Section 299 of the Companies Act, 1956 shall be treated as sufficient compliance under this clause regarding situations of potential conflicts of interest. III. Confidentiality of Company Information and use of Company's Funds and Confidential Information of others The directors shall maintain confidentiality of information entrusted to them by the Company and any other confidential information about the Company that comes to them in their official capacity except when disclosure is duly authorized by the Audit Committee or Board of Directors or is required by laws or regulations. All directors shall use the Companys funds diligently. The directors shall not use the confidential or proprietary information or position for personal gain. The directors are required to abide by the terms of the relevant non-disclosure agreement and limit its use to the specific purposes for which it was disclosed and to disseminate it only to others with a need to know the information. Board
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members shall not attempt to obtain a competitors confidential information by improper means.

IV. Avoidance of Conflicts of Interest The directors shall avoid and disclose actual and apparent conflicts of interest. A conflict of interest exists where the interests or benefits of one person or entity conflicts with the interests or benefits of the Company. V. Prohibition of Insider Trading The directors and their immediate family shall not derive any benefit or assist others to derive any benefit from the access to and possession of information about the Company which is not in the public domain and thus constitutes insider information. They shall comply with the SEBI (Prohibition of Insider Trading) Regulations, 1992. VI. Compliance with Governmental Laws, Rules and Regulations The directors shall comply with all applicable Governmental laws, rules and regulations. The directors are expected to have knowledge of legal obligations relating to their duty and to accomplish their tasks in conformity with such obligations. VII. General The Code is exemplary and does not attempt to quote all transactions and examples. Where there arises doubt or questions about the appropriateness of specific instances, directors are required to consult the Company Secretary.

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It is part of the duty of directors to help in the enforcement of the Code. They are under an obligation to bring any violation of the Code to the knowledge of the Company Secretary. This Code is subject to modifications and no amendment / waiver of any provision of the Code is possible unless approved in writing by the Board of Directors of the Company. In addition, in performing their Board and Board Committee functions, the directors shall not hold position of Director/Advisor with a competitor Company. Code of Conduct for Senior Management Personnel of the Company TNPLs philosophy on Corporate Governance endeavours to achieve the highest levels of transparency, integrity and equity in all its operations and its dealings with all stakeholders. This commitment to ethical and lawful business conduct is a non negotiable foundation that the Company and all its officers stand for. Consistent with this commitment and in compliance with regulatory requirements, this Code of Conduct has been formulated. The code is applicable to the Senior Management Personnel i.e. all members of management one level below the Executive Directors, including all functional heads. I. Honest and Ethical Conduct The officers shall act in accordance with the highest standards of personal and professional integrity, honesty and ethical conduct. II. Disclosure of Interest in Material Transactions The officers shall disclose the nature of his / her interest or concern in any material transaction made or proposed to be made on behalf of the Company. Such
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disclosure shall be made to the Company Secretary as soon as it comes to his / her knowledge. A disclosure of interest under Section 299 of the Companies Act, 1956 shall be treated as sufficient compliance under this clause regarding situations of potential conflicts of interest.

III. Confidentiality of Company Information and use of Company's Funds The officers shall maintain confidentiality of information entrusted to them by the Company and any other confidential information about the Company that comes to them in their official capacity except when disclosure is duly authorized by the Audit Committee or Board of Directors or is required by laws or regulations. All officers will use the Companys funds diligently. The officers shall not use the confidential or proprietary information or position for personal gain. IV. Avoidance of Conflicts of Interest The officers shall avoid and disclose actual and apparent conflicts of interest. A conflict of interest exists where the interests or benefits of one person or entity conflicts with the interests or benefits of the Company. V. Prohibition of Insider Trading The officers and their immediate family shall not derive any benefit or assist others to derive any benefit from the access to and possession of information about the Company which is not in the public domain and thus constitutes insider information. They shall comply with the SEBI (Prohibition of Insider Trading) Regulations, 1992.
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VI. Compliance with Governmental Laws, Rules and Regulations The officers shall comply with all applicable Governmental laws, rules and regulations. The officers are expected to have knowledge of legal obligations relating to their duty and to accomplish their tasks in conformity with such obligations. VII. General The Code is exemplary and does not attempt to quote all transactions and examples. Where there arises doubt or questions about the appropriateness of specific instances, officers are required to consult the Company Secretary. It is part of the duty of officers to help in the enforcement of the Code. They are under an obligation to bring any violation of the Code to the knowledge of the Company Secretary. This Code is subject to modifications and no amendment / waiver of any provision of the Code is possible unless approved in writing by the Board of Directors of the Company.

AWARDS
Felicitations In pursuit of excellence, TNPL has won many accolades. This is in recognition of its continuous innovation and constant improvement in all spheres of its activity.

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Awards and Accolades Best Paper Mill 2007-08 TNPL has bagged the prestigious "Paper Mill of the year 2007-08" award. The award is given in recognition of the Indian paper mill which sets an example in the areas of productivity, quality, human resource development, research & development, developing export markets, community services etc. besides striving to attain global competitiveness by the Indian Paper Manufacturers Association (IPMA), New Delhi. Earlier, the Company received the award for 2001-02 for TNPL's overall performance, approaches for meeting social obligations, ensuring global competitiveness and sustainable development & technology options. Certificate of Excellence TNPL bagged, the Certificate of Excellence in Productivity, Quality, Innovation and Management from the "Institute of Economic Studies", New Delhi. Environment Protection Recognising TNPL's concern for the environment, the Rotary Club of Chennai (East) and Earth Care bestowed the "Dr M.S. Swami Nathan Award for Environment Protection 2002" on TNPL. Export Award TNPL has bagged the CAPEXIL "SPECIAL EXPORT AWARD" for the 10th consecutive year, for its outstanding export performance during the year 2007-08.

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The Government of India has given "TRADING HOUSE" status to TNPL recognising the export performance. TNPL has been bestowed the "Niryat Shree Award" by Federation of Indian Export Organisation (FIEO) for the high degree of excellence it has demonstrated in exports.

Excellence in Cost Management TNPL has bagged ICWAI National Award for "Excellence in Cost Management 2008" (Second) under the category of Public Sector Manufacturing - Organisation (Medium). The Award is given by the "Institute of Cost and Works Accountants of India" (ICWAI) for the best costing practices in the companies.

Credit Rating by ICRA Ltd. ICRA has assigned the following ratings for the Bank borrowings of TNPL under BASEL II norms.

Long Term Loan - LAA Short Term Loan - A1+

Safety Award TNPL was awarded the commendation award on "CII Leadership & Excellence Award in Safety, Health & Environment (SH&E) year 2002".

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Energy Award TNPL bagged the National Energy Conservation Award for the year 2001 from Government of India in recognition of its outstanding achievement in energy management.

Best Corporate Citizen Loyola Institute of Business Administration (LIBA) Chennai adjudged TNPL as the "Best Corporate Citizen 1999" and bestowed the Mother Theresa Award by recognizing its Outstanding social commitment Exploring eco-friendly technology Professional Management Customer friendly and community caring enterprise. Innovative Project The Confederation of Indian Industry (CII) recognised the Bio-methanation plant of TNPL as "Innovative Project" and bestowed an award for Excellence in Energy Management. Green Rating The Centre for Science and Environment, New Delhi has awarded TNPL "3 Leaf Green Rating" award in appreciation of Environmental Management System. Excellence in Corporate Governance The Institute of Company Secretaries of India(ICSI), New Delhi has conferred on TNPL, the "ICSI National Award for Excellence in Corporate Governance" for the
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year 2004 in the Public Sector category. This is the first time such a prestigious award in Corporate Governance has been given to a State Public Sector Undertaking. The Energy and Resources Institute (TERI) Corporate Award Most recently, TNPL has been awarded second prize in the prestigious "TERI Corporate Environmental Award 2008" in recognition of its various initiatives taken in Corporate Environment Management. Energy Award TNPL bagged the National Energy Conservation Award for the year 2001 from Government of India in recognition of its outstanding achievement in energy management. Supply Chain Performance Excellence Award TNPL has bagged the Supply Chain Performance Excellence Award for the year 2009 from Indian Institute of Materials Management (IIMM), Chennai Branch in recognition of the company's performance in the area of Inventory Optimisation. Corporate Social Responsibility (CSR) Award TNPL has bagged the CSR award for 2007-2008 from Government of Tamilnadu for the exemplary service rendered in rural and urban development. Instituted by the Rural Development Department, the award is given to industrial units, taking into account their service relating to CSR in the last five years.

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OUR PRODUCTS TNPL offers high-quality surface sized and non-surface sized paper to suit the needs of modern high speed printing machines. TNPL's cutting edge technology backed by experienced professionals ensures quality products to customers. TNPL s manufacturing processes are equipped with state-of-the-art control systems to maintain critical quality parameters on line. The paper produced by TNPL is eco- friendly as the pulp is manufactured out of renewable raw material and is subjected to Elemental Chlorine Free (ECF) bleaching. As the paper is acid free, it has a longer colour stability and enhanced permanency in terms of strength characteristics. TNPL caters to the requirements of multifunctional printing processes like sheetfed, web offset, and digital printers. The paper reels have uniform profile with strength properties to cope even with high speed machines. TNPL manufactures Printing and Writing Papers in substances ranging from 50 GSM to 90 GSM. TNPL Ultra White Maplitho A premium product with superior brightness and opacity for high resolution, multicolour printing. It is an ideal product for high-end printing segments like diaries, calendars, annual reports, brochures and catalogues.

TNPL Elegant Maplitho A high bright paper with excellent visual appeal and good surface properties. It is best suited for printing of diaries, calendars, posters, annual reports and quality text books etc.

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Hi-Tech Maplitho With a pleasant shade and improved optical properties, Hi-tech maplitho is an economical product for quality multi colour printing on high speed web offset printing machines. The product has been an ideal choice amongst the computer stationery, notebook and calendar manufacturers. TNPL Maplitho An economical and ideal offset printing paper with entry level surface sizing and most suitable for high speed single and double colour commercial offset printing Radiant Printing A non-surface sized paper with good strength and visual appearance. This product is the customers choice for printing of textbooks, student notebooks, brochures and commercial grade printing TNPL Offset Printing Bright and endowed with superior internal bonding strength, it renders good functional properties. This product is best suited for student notebooks and continuous stationery Cream wove This is a product for "low end-high quality" printing. It is ideal for examination papers, text books, students exercise notebooks and a wide range of stationery

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Copy Crown

A super bright mutli-purpose office paper known for high opacity. It is offered in ready to use cut size packets converted and packed on state of the art on line sheeters. Copy crown comes in attractive, compact and convenient packages. This product is available in A4 size 80 / 75 GSM packs of 500 sheets. This multifunctional paper is designed to meet all the printing needs of a modern office. It is ideally suited for laser, inkjet, plain paper fax and digital copiers.

TNPL Copier

A widely known copier paper conforming to international standards. This copier paper is offered in 80 and 75 GSM. It is available in A4, A3 and legal sizes. Operationally well accepted for high-speed copying by virtue of its excellent dimensional stability. The product is offered in moisture proof attractive convenient packs.

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Students' Favourites

Eezee Write Ready-to-use cut sized writing paper offered in convenient and shrink wrapped packing. It is converted to perfect dimensions in an online sheeting machine of international repute. This bright writing paper with a smooth finish is an ideal choice for writing. The product is offered in two sizes viz. 33.5 X 42.0 cm and 34.5 X 43.0 cm in reams of 500 sheets. Super Print Maplitho A Product for high speed printing. The smooth surface with an excellent finish gives unique print evenness. This printer friendly product exhibits high degree of runnability and low degree of ink consumption. This new product from TNPL is becoming an ideal choice among printers and publishers. Commander A A4 new cost effective cut-size paper with improved sheet properties for multipurpose office uses. Offered with high brightness coupled with enhanced visual efficiency. Uniquely designed for high speed high volume photocopying and for common desk top printers.

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Eco-friendly Hard-bound Notebooks TNPL Hardbound notebooks are made from top class surface sized ultra white paper with a very pleasing shade with extra smoothness for trouble free writing. The notebooks are made with strong and rigid covers with laminated multi color designs. The binding, made with latest technology, is the unique feature which is very easy to handle, durable and at the same time has long life. Perfect Copier A new economic copier developed with functional properties for trouble free "Highvolume", "High-speed" commercial mass copying. The product is offered in moisture proof attractive convenient packs.

Ace Marvel An innovative product for different end-applications such as "Thermal and carbonless coating", Notebooks and Computer Stationery. Ace Marvel + is specially treated for lint free high quality and high speed 4 colour offset printing.

TECHNOLOGY Tomorrow's Technology Today TNPL is an acknowledged leader in technology in the manufacture of paper from bagasse. It is one of the few units in the world to make paper from bagasse sugar cane waste. The key areas of operation have been innovatively designed and developed by a competent technical team of the company. TNPL has two high-speed paper machines from Beloit Walmsley and Voith Paper. Together they produce 700 tonnes of paper every day. Amply supported by online process and quality control systems the company ensures uniform and consistent
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quality without compromising on efficiency. The company's endeavour has been to go for the latest technology with the objective of manufacturing best quality paper as well as making the company environment friendly. Mill Development Plan (MDP) The Mill Development Plan (MDP) of TNPL commissioned in May 2008, focuses on improvement of environmental performance of the mill. The MDP involved installation of the following key facilities, at a total capital outlay of Rs.612 crores i.e. 142 million US dollars:

A 300 tpd state-of-the-art Hardwood Pulp line with Elemental Chlorine Free (ECF) bleaching sequence. A 500 tpd ECF bleaching plant for Chemical Bagasse Pulp. An integrated Chlorine-di-oxide plant of 15 tpd capacity. A 1300 tpd Black Liquor Dry Solids (BLDS) recovery boiler along with a 20 MW turbo generator. A falling film black liquor evaporator of 350 tonnes per hour (tph) water evaporation to concentrate the black liquor upto 70% solids. Installation of ECF bleaching will make the company to become more compliant towards environmental regulations, operationally efficient besides being cost effective. Post-MDP, the paper production capacity of the mill shall be 245,000 tonnes per annum besides producing 45,000 tonnes per annum of surplus pulp for sale. Mill Expansion Plan (MEP) TNPL has now embarked on a Mill Expansion Plan (MEP) involving capital outlay of Rs.1000 Crore i.e. 233 million US dollars. The project aims to increase the
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paper production capacity of the mill from 2, 45,000 tonnes to 4, 00,000 tonnes per annum utilizing the surplus pulp generated under the Mill Development Plan already implemented. The Mill Expansion Plan (MEP) involves installation of a state-of-the-art Paper Machine with a production capacity of 1,55,000 tonnes of fine paper per annum, backward integration of ECF bleach plant of Chemical Bagasse Pulp and a multi-fuel boiler with steam generation capacity of 125 tph. Under MEP, the in-house pulp production will be increased from 800 to 880 tpd.

For the MEP, TNPL has placed the orders on M/s. VOITH Paper GmbH & Co., KG, Germany for supply of Paper Machine - 3 and on M/s. Metso Paper Sundsvall AB, Sweden for supply of equipment for backward integration of 500 oven dried (OD) tpd Chemical Bagasse Pulp ECF bleach plant. The commissioning for the Mill Expansion Plan is set as June 2010. This will enable TNPL to join the elite group of "1000-plus" (tpd) mills and the company will emerge as the largest Paper Mill in a single location in India. The MEP includes installation of equipments to address the improvement of environment performance viz. Electrostatic Precipitator (ESP) for the power boiler, additional equipments for effluent treatment plant, oxygen delignification & new brown stock washing equipments at a cost of Rs.126 Crores. Life Cycle Extension (LCE) of Paper Machine - 1 Apart from adding the capacity, the mill has also taken up life cycle extension programme for the Paper Machine - 1, at a cost of Rs.65 Crore i.e. 15 Million US Dollars. The PM-1, which was installed during 1985, is being equipped with a state-of-the-art dilution control head box including Profilmatic as well as a wet end retention control system, strengthening of press frames, improvements in the size press, calendar, pope reel and winder. The upgrade will result in improved quality of paper from this machine apart from offering a new lease of life for the machine. Paper Machine-1 was stopped on 16.03.09 as planned and all the LCE jobs were carried out as per schedule. The Paper Machine-1 was put into operation on 15.04.09.
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TNPL has a full-fledged finishing house for automatic conversion of reels into sheets and two cut-pack lines to have finely cut and wrapped A4, A3, folio sheets. To capitalize on the growing demand for these papers, TNPL has augmented its cut-pack line capacity to

350tpd with addition of a state-of-the-art 200 tpd cut-pack system from Beilomatik, Germany. TNPL derives its strength from its dedicated in-house Research & Development (R & D) team, one of the best in the country. TNPL's customer-focused R&D has been instrumental in improving quality, ensuring consistency and introducing new products based on market feedback and needs.

Research & Development and Quality Control TNPLs contemporary cutting edge technology processes and equipments along with a team of dedicated trained professionals ensure that customers always get consistent quality products. State of the art Online Process Control Systems installed at various stages of manufacturing processes continuously measure and control critical parameters. R&D and QC activities are aimed towards achieving companys corporate goals. Sustained R&D efforts to support process for improvements in quality and trouble shooting. Customized support to customers and provide workable solutions for specific problems. Right quality and quantity of raw materials usage ensured through structured sampling and testing. Effective pollution abatement measures to meet all statutory and mandatory norms which also fetch Carbon Credit benefits.
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Set product norms/specifications to meet customer requirements based on national/ international standards applicable. Appraise conformance by inspection and testing of periodic samples in one of the best equipped laboratories in the country. Take corrective action, if necessary and sustain the standards achieved. R&D and QC department plays a pro active roll in meeting the companys environmental and quality policy

TNPL Centre for Biotechnology and Bio energy Pulp and paper industry basically has strong relationship with biology and biotechnology, as the main source of paper making raw material comes from the plant source. TNPL has realized the importance of biotechnology and its application to paper industry and has created advanced research facility to work on the Biotechnology and Bio energy. TNPL has around 6000 square feet of built-up area to accommodate two major research facilities to work on Plant Biotechnology (Plant Tissue Culture and Microbial Biotechnology and bio energy). Besides, facilities like Polyhouse, Shade Net and an experimental field station of around five acres are attached to the new facility and plan to introduce new plant breeding facility to cater to the needs of above research programs. Tissue culture, the process of growing cells artificially in the laboratory produces clones, in which all product cells have the same genotype. The three key areas in which plant cell & tissue culture have direct application in paper industry are:

Large scale propagation of elite and improved clones from hybrid or specific parent lines through micro propagation. Production of disease-free and uniform growth character plantlets. Development of plant varieties through cellular and molecular techniques in conjunction with conventional plant breeding.
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TNPL has developed tissue culture protocol for 2 clones. 2,70,000 seedlings were developed from superior Eucalyptus clone and supplied to farmers through Plantation section during the past 2 financial years. First time in the country, the mini cutting propagation based on sand bed mini clonal garden was developed by integrating the micro and macro propogation. Information Technology - Online Integrated Information System (OIIS) TNPL believes and invests in state of art technology. In association with CMC Ltd TNPL has developed a comprehensive Online Integrated Information System (OIIS), which provides real time information for quick decision making. The Online Integrated Information System (OIIS) using Oracle 10g-R2 Database consists of 16 modules covering most of the functions in factory, corporate office and branches. All the modules are integrated. Centralized data base is maintained at factory. The infrastructure in the factory consists of 2 Nos. of HP Servers in cluster as application server and database server and Storage Area Network (SAN) providing for centralized data storage based on fibre channel with an automated tape backup system. There are 5 nos. of Intel servers to cater to the need of firewall server, file server, proxy server, test database server and backup file server. One titanium server is being used as mail server. The computers in the factory are connected by Campus Area Network (CAN). The computers in the corporate office are connected by Local Area Network (LAN). The computers in factory and corporate office are connected through Wide Area Network (WAN). Similarly, the computers in the factory, corporate office and branches are connected through Virtual Private Network (VPN). As a first step towards e-CRM (Customer Relationship Management) and e-SCM (Supply Chain Management), marketing and materials activities are web enabled. TNPL maintains a Disaster Recovery System (DRS) at Bangalore for the valued data.

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ENVIRONMENT Environment Protection and management are integral part of TNPL's activities. TNPL has taken several measures for protecting the environment in line with its commitment for sustainable development. In its choice of raw materials, sources of energy, and production processes, as well as in product development, the objective is to minimize the pollution load on environment. In all its business operations TNPL takes social, economic and ecological considerations seriously. TNPL is an unfolding saga of commitment to sustainable development. Guided by principles of environmental responsibility, TNPL manufactures and markets paper using materials and processes that help minimize waste, conserve resources and protect Earth's bio diversity. Its unfailing commitment to clean production techniques with minimum pollution load stand out as a bench mark in the industry. Recognizing, TNPL's commitment to preserving nature, the World Wide Fund for Nature - India (WWF) has endorsed TNPL as an eco-conscious company and has franchised its PANDA Logo to be used on TNPL's branded products. Through the adoption of sound ecological practices at every stage of activity, TNPL has not only brought down the pollution load but also improved the overall profitability through adoption of cleaner production technologies. Besides as a responsible corporate citizen the company has initiated many community development activities to enhance the quality of life in and around TNPL which has brought in lot of goodwill. Harnessing of wind energy, adoption of greener technologies, resource conservation, responsible waste management and minimal pollution loads make TNPL one of the most environmentally compliant mills in the world.

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By using bagasse as primary raw material, TNPL preserves over 40000 acres of forest land from depletion every year. TNPL has also been adopting multi-pronged, ecologically sound approach towards waste minimization and cost reduction through adoption of cleaner production technologies. TNPL is accredited with ISO14001:2004 certification for an effective environmental management system. TNPL Effluent Water Lift Irrigation Society (TEWLIS) Effluent water from the process is treated in a state-of-art effluent treatment system, through an "Activated Sludge Process". The treated effluent water conforming totally to the Pollution Control Board norms is utilized for irrigating the dry barren lands around the mill. Around 1700 acres of arid land are irrigated with the treated effluent water under TEWLIS scheme. The main crops cultivated in the ayacut area are coconut, sugarcane, paddy and tapioca. The lands which were dry and parched earlier are now lush green and are a source of perennial revenue to the land owners. TNPL Plantation Programme For the production of 2,45,000 Mt of paper, the mill requires about 4,50,000 tons of pulpwood per annum. The current supply available in the state is far behind the demand. Hence, to meet the growing raw material requirement and also to subserve the 1988 National Forest Policy Guidelines of Indian Government, TNPL has initiated plantation programme during 2004-05 and has accelerated the pace to increase the area under pulp wood plantations. Now the plantation programme is entering into its fifth year of operation, expanding the targets with refinement and up-gradation of technologies every year. TNPL is now deploying several innovative

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Measures and technological advancements resulting in significant achievements in many aspects of the plantation programme. TNPL plantation programmes comprise two approaches viz., farm forestry and captive plantations. Farm Forestry The major activities carried out in this programme are motivating the farmers on tree farming and facilitating them to raise the pulpwood plantations. Presently, development of pulpwood plantation in the land belonging to small and marginal farmers with minimum 50 acres in each village is encouraged. Under this scheme, dry land farmers in the State are encouraged to cultivate pulpwood trees. The salient features of Farm Forestry Scheme: Dry land farmers in the State are encouraged to cultivate pulpwood trees in their lands, which are currently barren. TNPL provides high quality seedlings/clones to the farmers at concessional rates. TNPL enters into an agreement with the farmers to buy the pulpwood at the prevailing market price at the time of harvest or at the minimum support price guaranteed at the time of entering into contract whichever is higher. TNPL provides assistance to the eligible farmers in obtaining bank finance. The principal amount together with interest is to be repaid after the harvest. TNPL provides free technical assistance for planting and advisory services after planting of seedlings/clones in farmers' lands.

TNPL arranges harvesting and transport of pulpwood from the farmers' field to factory.
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Captive Plantation: Captive plantations are raised in the lands belonging to the company, Government departments, Educational institutions and in the large land holdings of minimum 25 acres in a single block belonging to the participating farmers. The land would be taken either on long term lease spanning over a period of 15 to 30 years or on revenue sharing basis. In the case of revenue sharing basis, the benefits would be shared between the company and the landowners subsequent to the harvest at an agreed ratio. The salient features of Captive Plantation scheme: Revenue Sharing Basis TNPL undertakes the responsibility of land development, plantation and maintenance of trees. The landowners need not bear any expenses. At the end of 5th year, the produce harvested in the land will be shared between TNPL and the land owners as below:

Nature of Land Barren land Cultivable irrigated land

TNPL's share 70% 60%

Land Owner's share 30% 40%

The landowners can either opt to take the share of their produce or sell the wood to TNPL at the then prevailing market rate. Lease Rent Basis Under this arrangement,
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TNPL undertakes the responsibility of land development, plantation and maintenance. TNPL pays lease rental to the land owners every year as below:

Nature of Land Barren land Cultivable irrigated land

Lease rent per acre Rs.1000/- per annum


Rs.3000/- per annum

Clonal Propogation and Research Centre (CPRC): TNPL has added another feather in its cap by commissioning a state-of-the-art clonal production centre of capacity with a 1.5 crores plants / year near the mill site. It is the largest pulp wood clonal production, research and development centre at a single location with world-class infrastructure facilities in India. In May 2007, the establishment of CPRC was started with 8000 sq.m of fogging and misting chambers, 4000 sq.m of hardening chamber and 10000 sq.m open nursery with updated technological innovations on par with international standards. Provisions are made to establish various research programmes in micro and macro propagation of Eucalyptus, Casuarina and other alternative pulpwood species. Clonal mini-gardens and breeding mini-orchards are being established in CPRC to carryout breeding and tree improvement works. This would facilitate production of preferred, site-specific clones suited to individual operational areas and reduce the
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cost of clones to the company and emerge as a profitable enterprise to the farmers. TNPL has established an area of 2734 acres under captive plantation scheme and 37,556 acres have been covered under farm forestry scheme involving about 8235 farmers in 15 districts of Tamil Nadu. In total TNPL has established pulpwood plantations in about 40,000 acres within a span of five years and is committed to raise plantation in about 15000 acres every year to attain the target of 1,00,000 acres by the end of 2012. The above plantation schemes are being implemented throughout Tamil Nadu through 10 regional offices in Karur, Manaparai, Tirunelveli, Karaikudi, Pudukottai, Namakkal, Trichy, Tanjore, Jayangondam and Panruti providing advice and technical assistance to tree growers.

Wind Farm: TNPL has affirmed to pursue its commitment to renewable energy. The company set up 15MW Wind farm power project at Devarkulam and Perungudi, which are backward villages of Tirunelveli District in the year 1993-94. The initial installed capacity of 15 MW has been enhanced to 35.5 MW as of March 2007 in 5 phases with an average generation of around 5.5 crores units per annum. Clean Development Mechanism (CDM) Project The global emissions need to be reduced from current 55 billion tCO2e to around 20 billion tCO2e by 2050 and stabilize the atmospheric CO2 concentration at around 450 ppm to avoid the catastrophic change in the climate as long-term target. Kyoto Protocol aims an interim short term binding target for industrialized countries (annex party) to reduce their emissions to specific targets by the period 2008-2012 using three tools. One of them is CDM (Clean Development Mechanism). A core principle in the Kyoto Protocol was to protect the climate system "for the benefit of
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present and future generations of humankind, on the basis of equity and in accordance with their common but differentiated responsibilities and respective capabilities" Developing nations (non annex party) participate in the treaty by selling emissions credits, termed "certified emissions reductions" (CERs), to parties with commitments to reduce their greenhouse gases (annex party). TNPL as leader in implementing sustainable and environment friendly technology projects has already registered two CDM projects with UNFCCC, first under waste management sector (biogas) and second in renewable energy sector (Wind Farm) to mitigate climate change. These projects have generated 1,75,129 Certified Emission Reduction (CERs) equivalent to as many tons of Carbon Di-oxide (CO2 ) and earning a revenue to company of Rs.10.59 crores so far. Third project (Chemical Recovery Boiler) is under validation stage and the request for new scenario to fit the project has been is accepted by CDM Executive Board. Revised PDD as per the revised scenario submitted to validator (Designated Operational Entity). The project is expected to yield around 1,50,000 CERs per annum. PDD completed for two more CDM projects (Biogas -II & 13.75 wind farm Project) and submitted for validator for global stake holder comments. Both projects are expected to generate around 50,000 CERs per annum in total. CORPORATE SOCIAL RESPONSIBILITY (CSR) TNPL, as a responsible corporate citizen, has ingrained the philosophy of Corporate Social Responsibility deeply into its value system. The company is consistently taking various community welfare initiatives for the benefit of the people living in the neighbouring villages. During the year 2008-09, the company has spent an amount of about Rs.1.60 crores for various CSR activities. Our CSR activities cover different sectors such as: 1. Education 2. Career and Knowledge development 3. Drinking Water 4. Medical and Public Health 5. Infrastructure and Road Improvements
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6. Promotion of Sports and Recreation 7. Live stock and Cattle care 8. Development of Tamil Language and Culture 9. Greening the Environment 10. Other Community Welfare Activities focused towards Women and Children 11. "Talent-Expo" 1. Education A modern school accredited with Five Star Status by Bharathidasan University, Trichy providing educational facilities upto 12th Standard, is functioning in the township catering to the educational needs of the children of employees and the children from the neighbourhood. The school has the distinction of turning out toppers at District level year on year. In 2008-09, one of the students has secured 3rd place in National Ball Badminton Championship. The school provides opportunities to children to excel in studies and extra curricular activities. Every year, the company spends about Rs.1 crore in providing education to nearly 2,200 students. TNPL provides free Scholarship to children belonging to the economically weaker section to pursue their education in TNPL School. TNPL also supports augmentation of educational facilities in various Government schools in neighbouring villages, through Supply of note books and giving financial assistance to meritorious children, building additional class rooms, providing furniture etc. The company has also provided computers to number of schools.

Students of Government High Schools and Higher secondary Schools securing first 3 ranks in the school in X & XII standard are awarded special prizes to motivate them. Besides, three (3) Students are sponsored from villages within a radius of 15 kms in and around the factory premises for the Diploma Course in Paper Technology conducted by Seshasayee Institute of Technology (S.I.T), Trichy. A sum of Rs.1 lakh has been given to Government Arts College, Karur to award students
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securing 1st, 2nd and 3rd ranks in University Examinations by setting up an endowment. 2. Career and Knowledge Development It has been TNPLs endeavour to provide various kinds of vocational training to the rural youth of the area. Accordingly, a Computer Training Centre has been set up to provide computer literacy to unemployed youth from the neighbouring villages. Based on aptitude, Advanced Training in computers is imparted to make the youth employable. A Soft Skill Development Centre has been set up which conducts Typewriting classes both in English and Tamil for unemployed youth from the villages. On completion of Training, the trainees appear at the public examination conducted by the State Government for different levels of proficiency in Typewriting. Training in sewing, apparel making and bee keeping is imparted to women from neighbouring villages to improve their employability. By way of rehabilitating the differently abled persons, sewing machines, motorized 3 wheeler vehicles, one rupee telephone coin box and financial assistance to start small business was given. 32 beneficiaries received the assistance totalling to Rs.3 lakh during 2008-09 alone.

Youth from the neighbourhood are given intensive coaching to prepare them to appear in competitive examinations conducted by State/Central Govt. Through such efforts, in the year 2008, 6 were selected for appointment as Sub-Inspector and 22 as Constables in the Tamil Nadu Police Department. In 2009, 23 persons have been selected for appointment as Police Constables.

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3. Drinking Water Everyday, 3,00,000 litres of drinking water is supplied to residents in the 7 neighbouring villages, viz; Pazhamapuram, Thathampalayam, Ponniyagoundanpudur, Pandipalayam, Moolimangalam, Velliyampalayam and Kariyampatti. Water tanks have been constructed and pipelines laid by the company at a cost of Rs.35 lakhs. Besides, the company has provided financial assistance to the tune of Rs. 28.42 lakhs to the local bodies to augment supply of drinking water to the people. 4. Medical and Public Health TNPL regularly organizes Medical Camps in the neighbouring villages, through its Medical Officers and Para Medical Staff. Medical personnel of the Government Primary Health Centre also join the team. Patients are screened for ailments and medicine is distributed free of cost for minor ailments. For major illness, financial assistance is given to the individuals. Pamphlets on general health and hygiene are circulated amongst employees and the neighbourhood population. Blood donation camp is jointly organized by TNPL and the Blood Bank of the District Govt. Hospital, Karur on a regular basis. In 2008, an eye camp was organized jointly by TNPL and Aravind Eye Hospital, Madurai. 435 persons benefited out of the camp. Eye camp for students studying in the neighbouring Govt. Schools was organized in February, 2009. In the first phase, Teachers were given training by Doctors from Aravind Eye Hospital, Madurai. The training enabled the teachers to identify school children requiring treatment. Based on the screening, 275 students were examined by eye specialists from Aravind Eye Hospital, and spectacles were given to 83 students free of cost.

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5. Infrastructure and Road Improvements TNPL has been contributing its resources liberally towards the improvement of infrastructure in the neighbouring areas. The company has constructed drains and retaining walls in the TNPL Effluent Water Lift Irrigation Society (TEWLIS) ayacut area by spending Rs.86 lakhs. Besides, several road improvement works have been done and public toilets constructed. 6. Promotion of Sports and Recreation TNPL has taken several steps to promote sports amongst the youngsters of the area. District and State level athletic championships are hosted by the company. Youngsters from neighbouring villages are trained in various athletics disciplines under the supervision of coaches. Many of these athletes have won medals at the State level. The company has been conducting Volley ball and Kabaddi tournaments to encourage these rural sports. Company has instituted Rolling Shields to conduct these events every year. Besides, in 2007-08, an amount of Rs.10 lakh was given to the District Administration, Karur for construction of Sports Complex in Karur. 7. Live Stock and Cattle Care Live Stock and Cattle Care Camps are held in neighbouring villages once in 2 months. Medical and Para Medical staff from Department of Animal Husbandry and Veterinary Services, Tamil Nadu Govt. provide the specialist support. TNPL sponsors the event by meeting all the expenditure incurred in the camp. Medicines for cattle are provided and the camps have received tremendous response and support. During the year 2008-09 alone 5 camps were conducted benefiting thousands of cattle.

8. Development of Tamil Language and Culture


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By way of promoting Rural Art and Culture, cultural programmes by traditional folklore artistes are held. Needy artistes are given financial assistance. Debates and symposium in Tamil are held regularly. Local artistes are provided assistance to promote Rural Art and Culture. 9. Greening the Environment By way of increasing the area under Green cover, 50,000 saplings of trees like Neem, Vagai, Rain tree, Bamboo etc., were planted in the following Panchayat / Villages: Vettamangalam, Kuppam, Pavithram, Punjai Thottakurichi, Punjai Pugalur, Thirukkaduthurai, Nanjai Pugalur and Manmangalam on a single day ie: October 31, 2008. An amount of Rs. 20 lakhs has been spent for this purpose.

10. Other Community Welfare Activities Regular farmers meet is being conducted to train the farmers in scientific methods of cultivation and recent trends in farming. The company through a tie up with Tamil Nadu Agricultural University, Coimbatore (TNAU), carries out periodical study of the soil conditions and trains the farmers to get better yield. The farmers are also taken on conducted tour to other states / towns to get a first hand Knowledge of the improved farming techniques adopted in these places. During monsoon, the company chips in its contribution by cleaning weeds, debris, etc., and provide appropriate relief measures. As a welfare measure, gypsum is given to the farmers to improve the soil quality of their land. 11."Talent-Expo" Recognizing the fact that todays youth are the future of India, TNPL conducts TALENT-EXPO providing a platform to the students from rural and semi urban areas to exhibit their multifarious talents. In the TALENT EXPO 2009-10, over 1100 students from 50 schools participated in 22 competitions.
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MARKETING The Indian Paper Industry ranks 15th among the global producers. The Industry is fragmented with over 600 units with capacity ranging from 3 to 700 TPD based on virgin pulp, agro waste and recycled fibre. This has resulted in a very heterogeneous and competitive market. In an industry facing acute raw material scarcity, high energy demands and changing customer requirements for quality, TNPL enjoys 10% share in the Indian printing and writing paper market. Marketing in TNPL has always been a gateway function. The company has achieved Zero Stock during the past 17 years in a row. This was possible through efficient Production-Customer-Despatch chain management. The company has developed an effective in-house mechanism for order processing, production planning, storage and material despatch. As the largest exporter of printing and writing of paper in the country, the company exports to more than 25 countries.

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TNPL'S EXPORT PERFORMANCE

In recognition of its export performance, the Organization has bagged the Special Export Award from CAPEXIL for the 9th consecutive year. The company continues to focus on export of printing and writing paper as a corporate philosophy. TNPL has established a wide sales network consisting of 54 domestic dealers and 6 sales agents in overseas market. TNPL maintains countrywide branches in 9 major cities. The Marketing function encompasses one of the most modern comprehensive information management systems which provide real time customer and market analysis. The company is equipped with state of the art storage and shipping systems for fast and efficient despatch.

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State of the art storage and shipping systems help fast and efficient despatch. Dealer Locator Andhra Pradesh Delhi Gujarat Jharkhand Karnataka Kerala Maharashtra Orisa Punjab Rajasthan Tamilnadu

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Global Presence

HUMAN RESOURCES Training and Development TNPL firmly believes that Human Resource (HR) is the most precious resource available in the company. Hence it is companys endeavour to harness the Human Resources through various training and skill developmental programmes and innovative HR initiatives. Besides, TNPL has also instituted various employee welfare measures to provide an ideal working environment and improve the quality of work life. Welfare Activities A self contained modern Township with 700 houses, Park, facilities for playing indoor, outdoor and field games and places for religious worship has been established.

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Medical facilities Entire medical expenditure is borne by the company if any of the employee suffers from 7 ailments viz. Heart ailment, Cancer, Kidney Transplantation, Paralysis, Leprosy, Tuberculosis and Brain Surgery.

In respect of ailments not falling above, 50% of medical expenditure is met by the company for employees and their dependents. Comprehensive Health check-up for persons above 40 years of age.

Group Personal Accident Insurance cover. Superannuation scheme for Executives. Interest subsidy upto 5% on Housing Loans. A Modern School providing educational facilities upto 12th standard. Community Hall. Excursion trips for families of employees. A Modern Sports Stadium with 400 metre track and gymnasium. Sports and Recreation Clubs with Tennis, Shuttle, Volley Ball, Ball Badminton Courts and indoor games. Air Rifle Shooting Range to train young children.

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Useful Resources

www.ipma.co.in www.indiapapermarket.com www.papertradeindia.com/journals.htm www.pima-online.org www.risiinfo.com www.tappi.org www.cppri.org.in www.inpaper.com www.ipptaonline.org www.paperpundit.com www.marketresearch.com www.paperhall.org/info/glossary.html www.paperindex.com www.appita.com

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REVIEW OF LITERATURE

Management of Foreign Exchange Risk: A Review Article, by Laurent L. Jacque 1981 Palgrave Macmillan Journals. Abstract: This paper reviews the literature on Foreign Exchange Risk Management (FERM) which has burgeoned during the last decade. Scholars' and practioners' emerging interest in Foreign Exchange Risk Management was spurred by the advent of fluctuating exchange rates in the early seventies as well as by the pronouncement of the infamous FASB Statement No. 8 in 1976 which laid down unambiguous guidelines for consolidating financial statements of multinational corporations. A normative (rather than a market) view of Foreign Exchange Risk Management is taken and accordingly the author reviews first the two key informational inputs necessary for any Foreign Exchange Risk Management program: forecasting exchange rates and measuring exposure to exchange risk. Available decision models for handling transaction and translation exposures are reviewed next. A concluding section identifies gaps in the existing literature and suggests directions for future research.

From Wikipedia, the free encyclopedia

The foreign exchange market (forex, FX, or currency market) is a worldwide decentralized over-the-counter financial market for the trading of currencies. Financial centres around the world function as anchors of trading between a wide range of different types of buyers and sellers around the clock, with the exception of weekends. The purpose of the foreign exchange market 'Forex' is to assist international trade and investment. The foreign exchange market allows businesses to convert one
46

currency to another foreign currency. For example, it permits a U.S. business to import European goods and pay Euros, even though the business's income is in U.S. dollars. Some experts, however, believe that the unchecked speculative movement of currencies by large financial institutions such as hedge funds impedes the markets from correcting global current account imbalances. This carry trade may also lead to loss of competitiveness in some countries. [1] In a typical foreign exchange transaction a party purchases a quantity of one currency by paying a quantity of another currency. The modern foreign exchange market started forming during the 1970s when countries gradually switched to floating exchange rates from the previous exchange rate regime, which remained fixed as per the Bretton Woods system. The foreign exchange market is unique because of Trading volume results in market liquidity Geographical dispersion Continuous operation: 24 hours a day except weekends, i.e. trading from 20:15 UTC on Sunday until 22:00 UTC Friday The variety of factors that affect exchange rates The low margins of relative profit compared with other markets of fixed income The use of leverage to enhance profit margins with respect to account size As such, it has been referred to as the market closest to the ideal perfect competition, notwithstanding market manipulation by central banks.[citation needed] According to the Bank for International Settlements,[2] average daily turnover in global foreign exchange markets is estimated at $3.98 trillion as of April 2007. Trading in the world's main financial markets accounted for $3.21 trillion of this. This approximately $3.21 trillion in main foreign exchange market turnover was broken down as follows: $1.005 trillion in spot transactions $362 billion in outright forwards $1.714 trillion in foreign exchange swaps $129 billion estimated gaps in reporting
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Title: Foreign Exchange Management: New Opportunities and a New Perspective

Author(s): Professor Christine R. Hekman Journal: Managerial Finance Year: 1991 Volume: 17 Issue: 4 Page: 5 - 9 ISSN: 0307-4358 DOI: 10.1108/eb013675 Publisher: MCB UP Ltd Abstract: Foreign exchange exposure management has traditionally been viewed by corporate line management as a specialized and arcane corporate function. From its organizational position in Treasury or International Treasury, the function and the experts responsible for its execution, are frequently removed from the process of strategic planning and formulation of objectives. Foreign exchange experts are even less frequently consulted on matters of marketing and production investments and operation. Title: An Empirical Analysis of Foreign Exchange Management Strategies in International Sourcing

Author(s): Shawnee K. Vickery, Joseph R. Carter, Michael P. DItri


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Journal: International Journal of Physical Distribution & Logistics Management Year: 1993 Volume: 23 Issue: 8 Page: 38 - 45 ISSN: 0960-0035 DOI: 10.1108/09600039310049826 Publisher: MCB UP Ltd Abstract: Examines the cost performance of various strategies for managing foreign exchange risk in international sourcing. The strategies represent a broad spectrum of approaches to exchange risk, ranging from naive to active. Of particular interest is the comparison of those strategies which use exchange rate forecasts with those which do not. Focuses on movements in the German mark/US dollar exchange rate for the period January 1986 through December 1990. Employs a historical simulation methodology to compare the performance of various strategies over this time frame. The results suggest that active approaches to exchange rate management warrant further attention. Abstract: More than two decades ago, James Tobin suggested imposing a tax on all foreign exchange transactions (Tobin, 1978). Similar proposals for imposing transaction tax on trading of other securities (see Schwert and Seguin, 1993 for a review) are also often made by eminent economists (Stiglitz, 1989, Summers and Summers, 1989). One of the putative benefits of a transaction tax is that this may decrease the volatility of prices. The intuitive rationale behind this, believed to be first articulated by Keynes in 1936, is that a transaction tax would hurt the speculators disproportionately more because they tend to trade much more frequently. An implicit assumption in this argument is that speculative trading is on
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average destabilizing which in turn causes prices to be more volatile. A contrasting view is offered by Milton Friedman who argued (Friedman, 1953) that rational speculators may in fact help stabilize prices. The relative merits of these opposing views can only be judged by analyzing this issue empirically. The empirical evidence on the effect of transactions taxes on volatility of prices is rare. Umlauf (1993), using Swedish stock market data from the 1980s, shows that the introduction of, or an increase in Swedish tax, led to an increase in volatility of stock prices; Jones and Seguin (1997) show that the reduction in the commission portion of the transactions costs in 1975 led to a decrease in volatility (and increase in volume) of stock prices. However, there appears to be no empirical evidence in the extant literature on the effect of a transaction tax in the foreign exchange market on the volatility of exchange rates. In this paper, we provide some evidence. Our results, suggest that a Tobin tax on foreign exchange transactions may, in fact, lead to an increase in the volatility of exchange rates which is exactly the opposite to the claim made by Tobin and proponents of his suggestion such as Jeffrey Frankel who recently resurrected Tobin's argument (see Frankel, 1996). We estimate the effective transactions costs in the foreign exchange market for the period 1977 to 1999 using foreign currency futures data. Our approach in estimating the transactions costs in the foreign exchange market makes a contribution in two ways. First, we show that previous approaches for estimating the transactions costs in the foreign exchange market (Frenkel and Levich, 1975, 1977, 1979 and McCormick, 1979) had some methodological problems arising from the incorrect use of bid and ask price data and from the use of nonsynchronous data in the spot and forward markets. Second, we measure transactions costs faced by the marginal investors that set prices in the foreign exchange markets which is unlike the previous approaches which, if implemented correctly, would measure transactions costs in foreign exchange market that are faced by commercial customers of banks. While the estimates of transactions costs useful for judgements about the impacts of alternative exchange rate regimes on the levels of trade, might be those incurred by commercial firms, the estimates of cost relevant for determining prices, in contrast, are the smaller costs incurred by large commercial banks who are likely to be marginal investors
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determining prices in the foreign exchange market. We estimate that transactions costs over the last two decades on average were no more than one-twentieth of one percent, and in the last decade may have fallen to as low as one-fiftieth of one percent. We then, using our approach, construct time series of monthly estimates of effective transactions costs for four currencies, the British Pound, the Deutsche Mark, the Japanese Yen and the Swiss Franc. We also construct time series of monthly volatility (i.e., standard deviation) of foreign currency futures returns and monthly volume (i.e., number of futures contracts traded) for the four currencies. Using regression analysis, we document that volatility is positively associated with the level of transactions costs and that volume is negatively associated with the level of transactions costs. Thus our results are consistent with the notion that an increase in transactions costs does indeed lead to a reduction in volume of trading as one might expect, but its effect on volatility is exactly opposite of what proponents of Tobin tax would have liked to see.

Expenditure Switching and Exchange Rate Policy Charles M. Engel University of Wisconsin - Madison - Department of Economics; National Bureau of Economic Research (NBER); University of Washington Department of Economics

June 2002 NBER Working Paper No. W9016 Abstract: Nominal exchange rate changes can lead to 'expenditure switching' when they change relative international prices. A traditional argument for flexible nominal
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exchange rates posits that when prices are sticky in producers' currencies, nominal exchange rate movements can change relative prices between home and foreign goods. But if prices are fixed ex ante in consumers' currencies, nominal exchange rate flexibility cannot achieve any relative price adjustment. In that case nominal exchange rate fluctuations have the undesirable feature that they lead to deviations from the law of one price. The case for floating exchange rates is weakened if prices are sticky in this way. The empirical literature appears to support the notion that prices are sticky in consumers' currencies. Here, additional support for this conclusion is provided. We then review some new approaches in the theoretical literature that imply an important expenditure-switching role even when consumer prices are sticky in consumers' currencies. Further empirical research is needed to resolve the quantitative importance of the expenditureswitching role for nominal exchange rates.

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RESEARCH METHODOLOGY
This research consists of date analysis on exchange rate fluctuation. To study the exchange rate we need to analysis the market rate and forward rate of foreign currency. The data collection has been done for the last three years. To study the fluctuation I need to compare the spot rate and forward rate on exports. The line chart is used for monthly wise comparison of spot rate and forward rate and the bar chart is used for yearly wise comparison of net INR of TNPL.

PRIMARY OBJECTIVES: A study on the impact of exchange rate fluctuation on exports in Tamilnadu newsprint and paper limited.

SECONDERY OBJECTIVES:

To study the effective utilization of foreign currency To analyze the prevailing rate and rate as per forward contract on exports. To study the efficiency of the forward contract between the banker and

buyer.

To find out the profit and loss of TNPL exports for the financial year

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TYPE OF RESEARCH: This study is confined to explorations research, which in facts deals with the depth and insight of the details and the built-building concept was arrived after a deep analysis interpretation into the salts or the data collector. METHODOLOGY OF THE STUDY: The research tools for the date and invoice were gathered from secondary data. SOURCES OF DATA: Each and every data has been collected by referring the particular year's sales day books, journal vouchers, journal books and invoices. DURATION OF THE STUDY: The data has been collected for the last three financial years including this year that is 2007-08, 2008-09, and 2009. CHART REPRESENTATION: The chart representation is easy to observe our project to others. I have used following chart for this project. Line chart Column chart

The line chart is used to compare the monthly wise data of forward rate and spot rate. The bar chart is used to compare the net INR of TNPL in each month of the year as well as yearly wise comparison of Net INR.

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SCOPE OF THE STUDY:

The scope of the research is very wide because the exchange rate

fluctuation is caused due to move demand or less for their exchange rate.

The exchange rate is caused depending upon the economic policy of India,

so it is not easy to find out the awareness about the effect of the exchange rate fluctuation. The research is about micro view. Micro view study helps to find the accurate rather than approximate results.

LIMITATIONS OF THE SYUDY:

The report could not touch all aspect of problem because of limited source. The time constraints limited for collecting three years exports information. The incontrollable factors are more in exchange rate fluctuation. Finding out the exact future trend in not possible in exchange rate

fluctuation.

Prediction of time for exchange rate fluctuation is not possible.

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Data Analysis and interpretation

Effective utilization of foreign currency in TNPL for the month of April 2007: Table no.1 RATE AS EXPORT CR.ADV DATE 03-Apr-07 04-Apr-07 05-Apr-07 06-Apr-07 07-Apr-07 10-Apr-07 12-Apr-07 13-Apr-07 18-Apr-07 19-Apr-07 21-Apr-07 26-Apr-07 27-Apr-07 28-Apr-07 INV IN USD 189466.2 209498.7 65716.6 18878.28 38291.07 246258.6 14885.32 9979.63 23829.49 136065.4 370925.1 169426.3 319114 218060.2 PER FORWARD RATE 44.5500 44.6000 44.6575 44.6300 44.6375 44.8510 44.8800 45.1050 45.1350 45.0675 45.0790 45.0200 44.9925 44.9820 NET INR PREVAILING RATE 44.6000 44.5800 44.6800 44.6900 44.7500 44.6900 44.8600 45.3500 45.1100 45.1200 45.1200 45.0700 45.0700 44.9700 -0.0225 -0.06 -0.1125 0.161 0.02 -0.245 0.025 -0.0525 -0.041 -0.05 -0.0775 0.012 -1478.6235 -1132.6968 -4307.745375 39647.6346 297.7064 -2445.00935 595.73725 -7143.4335 -15207.9291 -8471.315 -24731.335 2616.7224 -31233.5969 DIFFERENCE -0.05 INR(Rs) -9473.31

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Month of April 2007


45.6 45.4 45.2 45 Rates 44.8 44.6 44.4 44.2 44
-A pr 06 - 07 -A pr 10 -07 -A pr 13 -07 -A pr 1 9 -0 7 -A pr 26 - 07 -A pr 28 - 07 -A pr -0 7

FORWARD RATE PREVAILING RATE

04

Date

Chart no.1 Chart showing the comparison of forward rate and prevailing rate for the month of April 2007

Inference:

57

At the start of the month both the forward rate and prevailing rate started at the same rate and gradually increases till 15th April, and both rates had reached its peak at April 18, and then it gradually decreased at the end of the month.

Effective utilization of foreign currency in TNPL for the month of May 2007: Table no.2 RATE AS EXPORT CR.ADV DATE 02-May-07 09-May-07 15-May-07 16-May-07 23-May-07 26-May-07 31-May-07 INV IN USD 177184.4 638370.1 28672.07 159596.8 96532.03 15117.31 53742.92 PER FORWARD RATE 44.9275 44.9225 45.4150 45.5885 45.4925 45.8175 46.2900 NET INR PREVAILING RATE 44.9200 44.9200 45.1500 45.5600 45.5500 45.8000 46.4800 DIFFERENCE 0.0075 0.0025 0.265 0.0285 -0.0575 0.0175 -0.19 INR(Rs) 1328.883 1595.92525 7598.09855 4548.5088 -5550.591725 264.552925 -10211.1548 -425.778

58

Month of May 2007

47 46.5 46 Rates 45.5 45 44.5 44


ay -0 -M 7 a 1 5 y- 0 -M 7 a 16 y - 0 -M 7 a 23 y-0 -M 7 a 26 y-0 -M 7 a 3 1 y- 0 -M 7 ay -0 7

FORWARD RATE PREVAILING RATE

-M 02

09

Date

Chart no.2 Chart showing the comparison of forward rate and prevailing rate for the month of May 2007

Inference: Both the prevailing rate and forward rate started at the same rate and at May 15 prevailing rate was more than the forward rate and at the end of the month forward rate was more than the prevailing rate.

59

Effective utilization of foreign currency in TNPL for the month of June 2007: Table no.3 RATE AS PER EXPORT CR.ADV DATE 01-Jun-07 05-Jun-07 06-Jun-07 07-Jun-07 08-Jun-07 08-Jun-07 09-Jun-07 13-Jun-07 16-Jun-07 20-Jun-07 21-Jun-07 23-Jun-07 27-Jun-07 29-Jun-07 INV IN USD 30074.97 57916.03 55669.68 98551.38 173027.04 308782.1 33331.56 14952.9 27670.86 76821.29 37752.69 14807.77 156788.81 15207.3 FORWARD RATE 46.2600 45.7850 48.8900 44.9250 44.9250 46.0240 44.9250 44.9250 44.9250 44.9250 44.9250 46.1450 46.3200 46.2475 PREVAILING RATE 46.4000 45.8200 45.9500 45.9700 46.0600 46.0600 45.9600 45.9900 45.9300 45.9400 45.9000 46.2300 46.3400 46.3600 DIFFERENCE -0.14 -0.035 2.94 -1.045 -1.135 -0.036 -1.035 -1.065 -1.005 -1.015 -0.975 -0.085 -0.02 -0.1125 NET INR INR(RS) -4210.4958 -2027.06105 163668.8592 -102986.1921 -196385.6904 -11116.1556 -34498.1646 -15924.8385 -27809.2143 -77973.60935 -36808.87275 -1258.66045 -3135.7762 -1710.82125 -352176.6932

60

M o n th o f J u n e 200 7
50 49 48 47 Rates 46 45 44 43 42
Ju n 07 -07 -Ju n 08 -07 -Ju n 13 -07 -Ju n 20 -07 -Ju n 23 -07 -Ju n 29 -07 -Ju n07

FO R W AR D R ATE P R E VAILING R ATE

05 -

D ate

Chart no.3 Chart showing the comparison of forward rate and prevailing rate for the month of June 2007 Inference: Forward rate was at peak at June 08 and then it decreased to its lower value and it attained the value of prevailing rate at the end of the month.

61

Effective utilization of foreign currency in TNPL for the month of July 2007: Table no.4 RATE AS EXPORT CR.ADV DATE 03-Jul-07 04-Jul-07 06-Jul-07 06-Jul-07 11-Jul-07 17-Jul-07 18-Jul-07 19-Jul-07 21-Jul-07 22-Jul-07 23-Jul-07 INV IN USD 10944.86 222763.9 236896.5 45312.19 289365.53 48534.17 77238.03 153990.3 458687.4 24944.86 64222.27 PER FORWARD RATE 45.9750 45.9900 46.1525 44.9750 46.1880 44.9750 46.6500 46.9425 46.8140 46.0550 46.5075 NET INR PREVAILING RATE 45.9700 45.9700 46.1700 46.1700 46.2200 46.4400 46.8200 46.8300 46.7900 46.7900 46.5200 DIFFERENCE 0.005 0.02 -0.0175 -1.195 -0.032 -1.465 -0.17 0.1125 0.024 -0.735 -0.0125 INR(RS) 54.7243 4455.278 -4145.68875 -54148.06705 -9259.69696 -71102.55905 -13130.4651 17323.90875 11008.4976 -18334.4721 -802.778375 -138081.3187

62

M o n th o f Ju ly 2 0 0 7
47.5 47 46.5 46 Rates 45.5 45 44.5 44 43.5
04 -Ju l -0 06 7 -Ju l -0 17 7 -Ju l -0 19 7 -Ju l-0 22 7 -Ju l -0 7

F O R W AR D R ATE P R E VAILING R AT E

D ate

Chart no.4 Chart showing the comparison of forward rate and prevailing rate for the month of July 2007 Inference: The prevailing rate had been constant throughout the month but the forward rate had seen more fluctuations due to unstable market conditions.

63

Effective utilization of foreign currency in TNPL for the month of August 2007: Table no.5 RATE AS EXPORT CR.ADV DATE 03-Aug-07 04-Aug-07 08-Aug-07 09-Aug-07 10-Aug-07 11-Aug-07 14-Aug-07 14-Aug-07 17-Aug-07 17-Aug-07 18-Aug-07 21-Aug-07 22-Aug-07 24-Aug-07 25-Aug-07 28-Aug-07 28-Aug-07 29-Aug-07 30-Aug-07 31-Aug-07 INV IN USD 15005.25 175791.2 79351.75 29590.52 15185.16 13379.63 37736.88 240686.9 18843.29 489977.8 185901.2 18579.19 263915 30780.49 75997.57 166219.2 160601.8 68197.88 22469.4 21636.72 PER FORWARD RATE 46.6060 46.5275 46.4800 46.4975 46.3550 46.4825 46.5515 46.5375 46.4240 46.5425 46.4680 46.8890 46.5070 46.4840 46.5490 46.5070 46.5000 46.4520 46.4950 46.4490 NET INR PREVAILING RATE 46.7600 46.5800 46.6400 46.5900 46.4000 46.5000 46.5800 46.5800 46.5200 46.5200 46.5000 46.4300 46.5000 46.5800 46.5700 46.5600 46.5600 46.4900 46.4900 46.5600 DIFFERENCE -0.154 -0.0525 -0.16 -0.0925 -0.045 -0.0175 -0.0285 -0.0425 -0.096 0.0225 -0.032 0.459 0.007 -0.096 -0.021 -0.053 -0.06 -0.038 0.005 -0.111 INR(RS) -2310.8085 -9229.038 -12696.28 -2737.1231 -683.3322 -234.143525 -1075.50108 -10229.19325 -1808.95584 11024.5005 -5948.8384 8527.84821 1847.405 -2954.92704 -1595.94897 -8809.6176 -9636.108 -2591.51944 112.347 -2401.67592 -53430.91016

64

M o n th o f Au g u s t 2 0 0 7
47 46.9 46.8 46.7 46.6 46.5 46.4 46.3 46.2 46.1 46
Au 11 g-07 -A u 17 g-07 -A u 21 g-07 -A ug 25 -07 -A u 29 g-07 -A ug -0 7

Rates

F O R W AR D R AT E P R E VAILING R ATE

08 -

D ate

Chart no.5 Chart showing the comparison of forward rate and prevailing rate for the month of August 2007 Inference: At the start of the month prevailing rate was more than the forward rate and in the middle it reached low, where the forward rate had reached its maximum and then it decreased.

65

Effective utilization of foreign currency in TNPL for the month of September 2007: Table no.6 RATE AS EXPORT CR.ADV DATE 01-Sep-07 04-Sep-07 07-Sep-07 08-Sep-07 13-Sep-08 14-Sep-08 15-Sep-08 20-Sep-07 21-Sep-07 21-Sep-07 21-Sep-07 22-Sep-07 26-Sep-07 28-Sep-07 INV IN USD 18693.88 139489.6 91350.03 74620.75 90749.67 49601.29 15405.39 76683.11 38465.2 160633.3 37886.77 85780.02 87047.1 59506.98 PER FORWARD RATE 46.5090 45.6400 46.0690 46.6300 46.4550 46.4550 46.1035 46.4550 46.5525 45.8075 46.5275 45.8775 48.8975 49.9000 NET INR PREVAILING RATE 46.5500 46.4700 46.0800 46.1500 46.2100 46.1200 46.1100 46.0900 45.8700 45.8700 45.8700 45.8700 48.9800 49.9500 DIFFERENCE -0.041 -0.83 -0.011 0.48 0.245 0.335 -0.0065 0.365 0.6825 -0.0625 0.6575 0.0075 -0.0825 -0.05 INR(RS) -766.44908 -115776.368 -1004.85033 35817.96 22233.66915 16616.43215 -100.135035 27989.33515 26252.499 -10039.58125 24910.55128 643.35015 -7181.38575 -2975.349 16619.67843

66

M o n th o f S e p te m b e r 2 0 0 7
51 50 49 48 47 46 45 44 43
ep 08 -07 -S ep 14 -07 -S ep 20 -08 -S ep 21 -07 -S ep 22 -07 -S ep 28 -07 -S ep -07

Rates

F O R W AR D R A T E P R E VAIL IN G R A T E

04 -S

D a te

Chart no.6 Chart showing the comparison of forward rate and prevailing rate for the month of September 2007 Inference: Throughout this month both rates started at Rs.46.5 and it moved together and reached its maximum in the end of the month.

67

Effective utilization of foreign currency in TNPL for the month of October 2007: Table no.7 RATE AS EXPORT CR.ADV DATE 03-Oct-07 04-Oct-07 04-Oct-07 05-Oct-07 06-Oct-07 11-Oct-07 12-Oct-07 17-Oct-07 17-Oct-07 18-Oct-07 19-Oct-07 19-Oct-07 20-Oct-07 25-Oct-07 30-Oct-07 30-Oct-07 31-Oct-07 INV IN USD 29590.63 14864.85 34529.7 96704.54 93580.34 171358.05 57196.52 174656.43 204570.6 296582 37676.87 32576.55 749264.5 101472 15489.46 101124.09 136149.9 PER FORWARD RATE 45.8560 45.8900 45.9775 45.8900 45.6000 45.8303 45.6000 45.3275 45.6000 45.3065 45.5649 45.2825 45.2525 45.9650 45.9650 45.2581 45.0125 NET INR PREVAILING RATE 45.8650 45.6750 45.6750 45.6950 45.6650 45.8150 45.5750 45.3450 45.3450 45.2550 45.3150 45.3150 45.2250 45.3750 45.1150 45.1150 45.0150 DIFFERENCE -0.009 0.215 0.3025 0.195 -0.065 0.0153 0.025 -0.0175 0.255 0.0515 0.2499 -0.0325 0.0275 0.59 0.85 0.1431 -0.0025 INR(RS) -266.31567 3195.94275 10445.23425 18857.3853 -6082.7221 2621.778165 1429.913 -3056.487525 52165.503 15273.973 9415.449813 -1058.737875 20604.77375 59868.48 13166.041 14470.85728 -340.37475 210710.6934

68

M o n th o f O c to b e r 2 0 0 7
4 6 .2 46 4 5 .8 4 5 .6 4 5 .4 4 5 .2 45 4 4 .8 4 4 .6 4 4 .4
04 -O 05 ct-07 -O 11 ct-07 -O 17 ct-07 -O 18 ct-07 -O 19 ct-07 -O 25 ct-07 -O 30 ct-07 -O ct07

Rates

FO R W AR D R ATE P R E V A IL IN G R A T E

D a te

Chart no.7 Chart showing the comparison of forward rate and prevailing rate for the month of October 2007 Inference: The TNPL had earned more profit in the month of October as the forward rate was higher than the prevailing rate throughout the month.

69

Effective utilization of foreign currency in TNPL for the month of November 2007: Table no.8 RATE AS EXPORT CR.ADV DATE 02-Nov-07 03-Nov-07 08-Nov-07 13-Nov-07 14-Nov-07 20-Nov-07 21-Nov-07 22-Nov-07 23-Nov-07 27-Nov-07 29-Nov-07 30-Nov-07 INV IN USD 199226.8 101472 37530 14795.26 189973.2 90477.53 37714.5 71499.29 45236.48 176523.8 46754.4 239123.2 PER FORWARD RATE 45.6050 45.6050 45.6050 45.6050 45.6050 45.6050 45.9775 45.9775 45.9775 45.7475 45.7425 44.7150 NET INR PREVAILING RATE 44.9350 44.8650 44.6650 44.7550 45.0950 44.8100 45.0200 44.7750 44.7450 44.6200 44.6650 44.7550 DIFFERENCE 0.67 0.74 0.94 0.85 0.51 0.795 0.9575 1.2025 1.2325 1.1275 1.0775 -0.04 INR(RS) 133481.956 75089.28 35278.2 12575.971 96886.332 71929.63635 36111.63375 85977.89623 55753.9616 199030.5845 50377.866 -9564.928 842928.3894

70

M o n th o f N o v e m b e r 2 0 0 7 4 6 .5 46 4 5 .5 Rates 45 4 4 .5 44 4 3 .5
13 -07 -N ov 20 -07 -N ov 22 -07 -N ov 27 -07 -N ov 30 -07 -N ov -07 ov

F O R W A R D R A TE P R E V A IL IN G R A TE

03 -N

D a te

Chart no.8 Chart showing the comparison of forward rate and prevailing rate for the month of November 2007 Inference: The TNPL had earned more profit as forward rate was more than the prevailing rate except in the end. The forward rate had reached its lower value at the end of the month.

71

Effective utilization of foreign currency in TNPL for the month of December 2007: Table no.9 RATE AS EXPORT CR.ADV DATE 01-Dec-07 04-Dec-07 06-Dec-07 07-Dec-07 08-Dec-07 11-Dec-07 15-Dec-07 20-Dec-07 21-Dec-07 22-Dec-07 26-Dec-07 27-Dec-07 28-Dec-07 INV IN USD 107345.1 30397.59 67370.88 200779.44 76068.23 30390.27 535484.5 58771.58 193993 19812.33 31778.38 19488.93 273357 PER FORWARD RATE 45.9500 45.9500 45.9500 46.0025 46.0025 46.0025 44.6300 44.6750 44.6725 44.5125 44.4750 44.3400 44.2700 NET INR PREVAILING RATE 44.6650 44.6450 44.5250 44.7250 44.6750 44.8100 44.6650 44.7050 44.7250 44.6250 44.5200 44.3300 44.3050 DIFFERENCE 1.285 1.305 1.425 1.2775 1.3275 1.1925 -0.035 -0.03 -0.0525 -0.1125 -0.045 0.01 -0.035 INR(RS) 137938.4535 39668.85495 96003.504 256495.7346 100980.5753 36240.39697 -18741.9575 -1763.1474 -10184.6325 -2228.887125 -1430.0271 194.8893 -9567.495 623606.262

72

M o n th o f D e c e m b e r 2 0 0 7
4 6 .5 46 4 5 .5 Rates 45 4 4 .5 44 4 3 .5 43
ec 07 -07 -D ec 11 -07 -D ec 20 -07 -D ec 22 -07 -D ec 27 -07 -D ec -07

F O R W A R D R A TE P R E V A IL IN G R A TE

04 -D

D a te

Chart no 9 Chart showing the comparison of forward rate and prevailing rate for the month of December 2007

Inference: The forward rate was constant till mid December and then it reaches to Rs.44.5, whereas the prevailing rate was same for the entire month.

73

Effective utilization of foreign currency in TNPL for the month of January 2008: Table no.10 RATE AS EXPORT CR.ADV DATE 02-Jan-08 03-Jan-08 08-Jan-08 09-Jan-08 11-Jan-08 12-Jan-08 18-Jan-08 19-Jan-08 22-Jan-08 23-Jan-08 24-Jan-08 25-Jan-08 29-Jan-08 31-Jan-08 31-Jan-08 INV IN USD 441696.4 15013.24 14685.15 158969.3 8945.12 266103.8 10020.53 339335.9 60709.4 82521.91 239822.5 89685.94 319363.9 14995.2 255226.6 PER FORWARD RATE 45.4000 44.2250 44.3575 44.3950 44.4975 44.5800 44.1900 44.2900 44.1600 44.1700 44.2200 44.1800 44.2300 44.1150 44.1155 NET INR PREVAILING RATE 44.1850 44.1850 44.3440 44.4340 44.4300 44.6300 44.2100 44.3700 44.3000 44.2200 44.3000 44.2600 44.3400 44.2600 44.2600 DIFFERENCE 1.215 0.04 0.0135 -0.039 0.0675 -0.05 -0.02 -0.08 -0.14 -0.05 -0.08 -0.08 -0.11 -0.145 -0.1445 INR(RS) 536661.126 600.5296 198.249525 -6199.8027 603.7956 -13305.19 -200.4106 -27146.872 -8499.316 -4126.0955 -19185.8 -7174.8752 -35130.029 -2174.304 -36880.2437 378040.762

74

M o n th o f J a n u a ry 2 0 0 8
4 5 .5 45 4 4 .5 Rates 44 4 3 .5 43
an 09 -08 -Ja n 12 -08 -Ja n 19 -08 -Ja n 23 -08 -Ja n 25 -08 -Ja n 31 -08 -Ja n-0 8

F O R W A R D R A TE P R E V A IL IN G R A TE

03 -J

D a te

Chart no.10 Chart showing the comparison of forward rate and prevailing rate for the month of January 2008

Inference: There was a slight increase in prevailing rate and then it decreased to a lower value and moves in same direction.

75

Effective utilization of foreign currency in TNPL for the month of February 2008: Table no.11 RATE AS EXPORT CR.ADV DATE 01-Feb-08 05-Feb-08 06-Feb-08 13-Feb-08 14-Feb-08 15-Feb-08 16-Feb-08 20-Feb-08 21-Feb-08 22-Feb-08 27-Feb-08 INV IN USD 26195.48 67869.9 15678.25 26471.26 45666.24 355041.1 30216.79 31684.22 128138.97 18583.61 48241.36 PER FORWARD RATE 45.2825 45.2825 45.2825 45.2825 44.0300 44.0300 44.0350 44.1400 44.1400 44.1950 44.1550 NET INR PREVAILING RATE 44.1600 44.1100 44.0850 44.3500 44.2150 44.1100 44.0900 44.1300 44.1500 44.2300 44.2100 DIFFERENCE 1.1225 1.1725 1.1975 0.9325 -0.185 -0.08 -0.055 0.01 -0.01 -0.035 -0.055 INR(RS) 29404.4263 79577.45775 18774.70438 24684.44995 -8448.2544 -28403.288 -1661.92345 316.8422 -1281.3897 -650.42635 -2653.2748 109659.3239

76

M o n th o f F e b ru a ry 2 0 0 8
4 5 .4 4 5 .2 45 4 4 .8 4 4 .6 4 4 .4 4 4 .2 44 4 3 .8 4 3 .6 4 3 .4
8 b08 8 8 b08 b-0 b-0 b-0

Rates

F O R W A RD R A TE P R E V A IL IN G RA TE

-F e

-F e 20

-F e

-F e

05

13

15

D a te

Chart no.11 Chart showing the comparison of forward rate and prevailing rate for the month of February 2008 Inference: The forward rate was constant till mid February and then it reaches to Rs.44, whereas the prevailing rate was same for the entire month.

22
77

-F e

Table no.12 NET INR FOR THE YEAR 2007 APRIL MAY JINE JULY AUGUST SEPTEMBER OCTOBER NOVEMBER DECEMBER JANUARY FEBRUARY NET INR -31233.59697 -425.778 -352176.6932 -138081.3187 -53430.91016 16619.67843 210710.6934 842928.3894 623606.262 378040.762 109659.3239 1606216.812

78

Net INR for the year2007


1000000 800000 600000 400000 INR(RS) 200000 0 -200000 -400000 -600000 Months
AP RI L M AY JIN E JU A L SE UG Y PT US EM T OC BE R NO TOB V E DE EM R CE BE M R JA BER N FE UA BR RY UA RY

S eries1

Chart no.12 Chart showing net INR of TNPL in 2007-08

Inference: In the year 2007-08, there is a negative INR till September 08, and starts increasing and reaches its maximum in the month of November and gradually decreases to Rs.1000000 approximately.

79

Effective utilization of foreign currency in TNPL for the month of April 2008: Table no.13 RATE AS EXPORT CR.ADV DATE 02-Apr-08 03-Apr-08 08-Apr-08 09-Apr-08 11-Apr-08 15-Apr-08 17-Apr-08 21-Apr-08 22-Apr-08 29-Apr-08 INV IN USD 130354.15 13118 18006.3 71029.98 54437.67 19228.28 11699.05 33504.74 13189.16 18002.79 PER FORWARD RATE 40.07 39.9 39.97 39.98 39.88 39.92 39.9 39.98 39.92 40.19 NET INR PREVAILING RATE 39.97 40.04 40.01 39.98 39.95 39.96 39.92 39.98 39.97 40.47 DIFFERENCE 0.1 -0.14 -0.04 0 -0.07 -0.04 -0.02 0 -0.05 -0.28 INR(RS) 13035.415 -1836.52 -720.252 0 -3810.6369 -769.1312 -233.981 0 -659.458 -5040.7812 -35.3453

80

M o n th o f A p r il 2 0 0 8
40.6 40.4 40.2 40 39.8 39.6 39.4
pr08 pr08 pr08 pr08 pr08

Rates

F O R W A R D R A TE P R E V A IL IN G R A T E

03 -A

09 -A

15 -A

21 -A

D a te

Chart no.13 Chart showing the comparison of forward rate and prevailing rate for the month of April 2008 Inference: There was a slight fluctuation in the prevailing rate and in the end there was a sudden rise in the prevailing rate due to the decrease in the Indian rupee value.

29 -A
81

Effective utilization of foreign currency in TNPL for the month of May 2008: Table no.14 RATE AS EXPORT CR.ADV DATE 02-May-08 05-May-08 06-May-08 12-May-08 13-May-08 15-May-08 20-May-08 23-May-08 26-May-08 28-May-08 29-May-08 30-May-08 INV IN USD 81506.25 32576.27 19498.88 12910.34 35378.76 13183.57 43283.74 131683.28 18194.18 104173.14 22447.58 191248.5 PER FORWARD RATE 40.56 40.52 40.65 41.71 42.07 42.27 42.61 42.83 42.5 42.81 42.7 42.55 NET INR PREVAILING RATE 40.63 40.6 40.94 42.05 42.1 42.74 42.6 42.7 42.72 42.73 42.78 42.45 DIFFERENCE -0.07 -0.08 -0.29 -0.34 -0.03 -0.47 0.01 0.13 -0.22 0.08 -0.08 0.1 INR(RS) -5705.4375 -2606.1016 -5654.6752 -4389.5156 -1061.3628 -6196.2779 432.8374 17118.8264 -4002.7196 8333.8512 -1795.8064 19124.85 13598.4684

82

M o n th o f M a y 2 0 0 8
4 3 .5 43 4 2 .5 42 4 1 .5 41 4 0 .5 40 3 9 .5 39
05 -M ay 12 -08 -M ay 15 -08 -M ay 23 -08 -M ay 28 -08 -M ay 30 -08 -M ay -0 8

Rate

F O R W A R D R A TE P R E V A ILIN G R A TE

D a te

Chart no.14 Chart showing the comparison of forward rate and prevailing rate for the month of May 2008 Inference: Both the forward rate and the prevailing rate increased together throughout the month which increases the net INR in return.

83

Effective utilization of foreign currency in TNPL for the month of June 2008: Table no.15 RATE AS EXPORT CR.ADV DATE 02-Jun-08 03-Jun-08 05-Jun-08 11-Jun-08 17-Jun-08 19-Jun-08 20-Jun-08 23-Jun-08 24-Jun-08 26-Jun-08 27-Jun-08 30-Jun-08 INV IN USD 12668.32 62604.71 45946.29 40753.98 95621.27 43958.38 22178.3 52610.29 39018.72 12975.93 24050.72 18906.62 PER FORWARD RATE 42.19 42.52 42.81 42.9 42.83 42.88 42.93 42.94 42.9 42.67 42.74 42.9 NET INR PREVAILING RATE 42.4 42.61 42.9 42.87 42.89 42.96 42.92 42.97 42.96 42.68 42.88 43.02 DIFFERENCE -0.21 -0.09 -0.09 0.03 -0.06 -0.08 0.01 -0.03 -0.06 -0.01 -0.14 -0.12 INR(RS) -2660.3472 -5634.4239 -4135.1661 1222.6194 -5737.2762 -3516.6704 221.783 -1578.3087 -2341.1232 -129.7593 -3367.1008 -2268.7944 -29924.567

84

M o n th o f J u n e 2 0 0 8
43.2 43 42.8 42.6 42.4 42.2 42 41.8 41.6
00 8 00 8 00 8 00 8 00 8

Rate

F O R W A R D R A TE P R E V A ILIN G R A TE

23 /06 /2

02 /06 /2

09 /06 /2

16 /06 /2

D a te

Chart no.15 Chart showing the comparison of forward rate and prevailing rate for the month of June 2008 Inference: The prevailing rate is more than the forward rate throughout the month which decreases the net INR of TNPL.

30 /06 /2
85

Effective utilization of foreign currency in TNPL for the month of July 2008: Table no.16 RATE AS EXPORT CR.ADV DATE 01-Jul-08 03-Jul-08 04-Jul-08 09-Jul-08 14-Jul-08 15-Jul-08 17-Jul-08 23-Jul-08 24-Jul-08 25-Jul-08 29-Jul-08 30-Jul-08 INV IN USD 17845.18 51437 39746 29896.02 23683.55 19223.1 259245.42 110230.25 23702.25 18436.47 49980 47514.06 PER FORWARD RATE 43.14 43.26 43.17 43.11 42.79 43.11 42.86 42.22 42.85 42.22 42.51 42.45 NET INR PREVAILING RATE 43.33 43.29 43.15 43.12 42.92 43.22 42.82 42.08 42.14 42.26 42.64 42.36 DIFFERENCE -0.19 -0.03 0.02 -0.01 -0.13 -0.11 0.04 0.14 0.71 -0.04 -0.13 0.09 INR(RS) -3390.5842 -1543.11 794.92 -298.9602 -3078.8615 -2114.541 10369.8168 15432.235 16828.5975 -737.4588 -6497.4 4276.2654 30040.919

86

M o n t h o f J u ly 2 0 0 8
4 3 .5 43 4 2 .5 42 4 1 .5 41
03 -Ju l09 08 -Ju l15 08 -Ju l23 08 -Ju l25 08 -Ju l30 08 -Ju l-08

F O R W A R D R A TE P R E V A IL IN G R A T E

Rate

D a te

Chart no.16 Chart showing the comparison of forward rate and prevailing rate for the month of July 2008 Inference: Both the forward rate and the prevailing rate decreased together throughout the month but at one stage forward rate increased to a certain limit which increases the net INR in return.

87

Effective utilization of foreign currency in TNPL for the month of August 2008: Table no.17 RATE AS EXPORT CR.ADV DATE 06-Aug-08 07-Aug-08 11-Aug-08 12-Aug-08 13-Aug-08 14-Aug-08 18-Aug-08 19-Aug-08 21-Aug-08 22-Aug-08 25-Aug-08 27-Aug-08 29-Aug-08 INV IN USD 32342 18906.62 23668.59 19806.93 18906.62 22402.25 18902.93 25180 23552.65 38137.5 99765.68 751.64 103719.24 PER FORWARD RATE 42.8 42.13 42.8 42.61 42.68 42.68 43.68 43.7 43.68 43.68 43.8 43.83 43.97 NET INR PREVAILING RATE 42.08 42.07 42.16 42.37 42.64 43 43.16 43.6 43.61 43.42 43.78 43.74 43.94 DIFFERENCE 0.72 0.06 0.64 0.24 0.04 -0.32 0.52 0.1 0.07 0.26 0.02 0.09 0.03 INR(RS) 23286.24 1134.3972 15147.8976 4753.6632 756.2648 -7168.72 9829.5236 2518 1648.6855 9915.75 1995.3136 67.6476 3111.5772 43710.0003

88

Chart no.17

M o n th o f A u g u s t 2 0 0 8
4 4 .5 44 4 3 .5 43 4 2 .5 42 4 1 .5 41
ug 12 -08 -A ug 14 -08 -A ug 19 -08 -A ug 22 -08 -A ug 27 -08 -A ug -0 8

Rate

F O R W A R D R A TE P R E V A IL IN G R A TE

07 -A

D a te

Chart showing the comparison of forward rate and prevailing rate for the month of August 2008 Inference: At the beginning the prevailing rate was lesser than the forward rate at the beginning and then it had increased in the end and had reached its maximum.

89

Effective utilization of foreign currency in TNPL for the month of September 2008: Table no.18 RATE AS EXPORT CR.ADV DATE 08-Sep-08 09-Sep-08 11-Sep-08 12-Sep-08 16-Sep-08 17-Sep-08 18-Sep-08 19-Sep-08 22-Sep-08 23-Sep-08 26-Sep-08 29-Sep-08 INV IN USD 38237 17908.19 18257.14 19718.4 22348.31 18799.81 175392.95 91931.92 83752 97056.38 20289.02 60867.07 PER FORWARD RATE 44.26 44.78 45.32 45.65 46.46 46.25 46.67 46.28 45.57 45.77 46.38 46.87 NET INR PREVAILING RATE 44.59 44.82 45.56 45.72 46.88 46.34 46.41 45.82 45.45 45.72 46.54 46.96 DIFFERENCE -0.33 -0.04 -0.24 -0.07 -0.42 -0.09 0.26 0.46 0.12 0.05 -0.16 -0.09 INR(RS) -12618.21 -716.3276 -4381.7136 -1380.288 -9386.2902 -1691.9829 45602.167 42288.6832 10050.24 4852.819 -3246.2432 -5478.0363 63894.8174

90

M o n th o f S e p te m b e r 2 0 0 8
4 7 .5 47 4 6 .5 46 4 5 .5 45 4 4 .5 44 4 3 .5 43 4 2 .5
09 -S ep 12 -0 8 -S ep 17 0 8 -S ep 19 -0 8 -S ep 23 -0 8 -S ep 29 -08 -S ep -0 8

Rate

F O R W A R D R A TE P R E V A IL IN G R A TE

D a te

Chart no.18 Chart showing the comparison of forward rate and prevailing rate for the month of September 2008 Inference: Both the rates increased first and then it decreased to certain extend and then increased once again and attains its maximum.

91

Effective utilization of foreign currency in TNPL for the month of October 2008: Table no.19 RATE AS EXPORT CR.ADV DATE 03-Oct-08 06-Oct-08 07-Oct-08 10-Oct-08 13-Oct-08 14-Oct-08 16-Oct-08 17-Oct-08 23-Oct-08 28-Oct-08 31-Oct-08 INV IN USD 23475.05 18328 17081 27909.88 20426.11 15824.48 53236.79 22915.47 17806.25 11760 22687.21 PER FORWARD RATE 48.74 48.74 48.74 48.87 48.87 48.6 48.32 48.1 49.72 49.71 49.14 NET INR PREVAILING RATE 47.08 47.81 47.93 48.45 48.25 48.07 48.83 48.88 49.81 49.87 49.44 DIFFERENCE 1.66 0.93 0.81 0.42 0.62 0.53 -0.51 -0.78 -0.09 -0.16 -0.3 INR(RS) 38968.583 17045.04 13835.61 11722.1496 12664.1882 8386.9744 -27150.7629 -17874.0666 -1602.5625 -1881.6 -6806.163 47307.3902

92

M o n th o f O c to b e r 2 0 0 8
60 50 40 30 20 10 0
03 /10 /20 08 10 /10 /20 08 17 /10 /20 08 24 /10 / 20 08 31 /10 /20 08

Rate

F O R W AR D R AT E P R E VAIL IN G R AT E

D a te

Chart no.19 Chart showing the comparison of forward rate and prevailing rate for the month of October 2008 Inference: There were no much fluctuations in both the forward rate and the prevailing rate throughout the month lead to positive INR.

93

Effective utilization of foreign currency in TNPL for the month of November 2008: Table no.20 RATE AS EXPORT CR.ADV DATE 03-Nov-08 04-Nov-08 05-Nov-08 06-Nov-08 07-Nov-08 11-Nov-08 13-Nov-08 14-Nov-08 19-Nov-08 21-Nov-08 24-Nov-08 25-Nov-08 26-Nov-08 INV IN USD 133741.23 103223.08 19617.42 38347.8 17034 19806.93 73271.14 12571.2 38724.08 90821.25 48046.05 58485 49707.15 PER FORWARD RATE 48.8750 48.8300 47.0600 47.5500 47.6200 47.4250 49.1600 49.3800 49.6500 50.1500 49.9400 49.8700 49.8100 NET INR PREVAILING RATE 48.6500 47.6900 47.4500 47.7400 47.6500 48.1100 49.3000 48.9800 49.9900 50.0300 50.0900 49.9500 49.4800 DIFFERENCE 0.225 1.14 -0.39 -0.19 -0.03 -0.685 -0.14 0.4 -0.34 0.12 -0.15 -0.08 0.33 INR(RS) 30091.77675 117674.3112 -7650.7938 -7286.082 -511.02 -13567.7470 -10257.9596 5028.48 -13166.1872 10898.55 -7206.9075 -4678.8 16403.3595 115770.9803

94

Month of November 2008


50.5 50 49.5 49 48.5 48 47.5 47 46.5 46 45.5
04 -N ov 0 6 - 08 -N ov 1 1 -0 8 -N ov 1 4 - 08 -N ov 2 1 -0 8 -N ov 2 5 - 08 -N ov -0 8

Rate

FORWARD RATE PREVAILING RATE

Date

Chart no.20 Chart showing the comparison of forward rate and prevailing rate for the month of November 2008 Inference: At the beginning forward rate decreased more than the prevailing rate and both increased with each other, and in the end forward rate ends at higher rate than the prevailing rate.

95

Effective utilization of foreign currency in TNPL for the month of December 2008: Table no.21 RATE AS EXPORT CR.ADV DATE 03-Dec-08 11-Dec-08 12-Dec-08 16-Dec-08 17-Dec-08 18-Dec-08 19-Dec-08 22-Dec-08 22-Dec-08 23-Dec-08 24-Dec-08 26-Dec-08 26-Dec-08 26-Dec-08 30-Dec-08 31-Dec-08 INV IN USD 19535 16975 114596.55 18987.08 34550 210892.3 18734 13439.25 18094.21 15816.85 95308.4 114616.55 39330 16872 18094.21 59323.31 PER FORWARD RATE 49.9500 48.4800 48.7400 44.8950 47.3700 47.2350 46.8800 47.3700 47.6300 48.4100 48.9500 49.0225 48.4800 48.3200 48.3200 48.3750 NET INR PREVAILING RATE 50.0000 48.3000 48.4400 47.9000 47.6450 46.9200 47.2500 47.2500 47.9900 47.9900 48.7850 48.0500 48.4200 48.4200 48.4500 48.7100 DIFFERENCE -0.05 0.18 0.3 -3.005 -0.275 0.315 -0.37 0.12 -0.36 0.42 0.165 0.9725 0.06 -0.1 -0.13 -0.335 INR(RS) -976.75 3055.5 34378.965 -57056.1754 -9501.25 66431.0745 -6931.58 1612.71 -6513.9156 6643.077 15725.886 111464.5949 2359.8 -1687.2 -2352.2473 -19873.30885 136779.1802

96

M o n th o f D e c e m b e r 2 0 0 8
51 50 49 48 47 46 45 44 43 42
16 c-08 -D e 18 c-08 -D e 2 2 c- 0 8 -D e 2 3 c- 0 -D 8 e 2 6 c- 0 8 -D e 2 6 c- 0 8 -D e 3 1 c- 0 8 -D ec -0 8

Rate

F O RW AR D RAT E P R E V A IL ING R A T E

11

-D e

D ate

Chart no.21 Chart showing the comparison of forward rate and prevailing rate for the month of December 2008 Inference: The forward rate decreased more than the prevailing rate till 22nd December, and then it increased till the end of the month.

97

Effective utilization of foreign currency in TNPL for the month of January 2009: Table no.22 RATE AS EXPORT CR.ADV DATE 02-Jan-09 04-Jan-09 06-Jan-09 11-Jan-09 12-Jan-09 16-Jan-09 23-Jan-09 27-Jan-09 28-Jan-09 30-Jan-09 INV IN USD 34821.06 14377.03 23019.58 15808 12433.85 86126.88 17999.2 36479.47 41174.78 24525.05 PER FORWARD RATE 48.89 48.61 48.29 48.77 48.83 48.98 48.29 48.99 48.89 48.99 NET INR PREVAILING RATE 48.58 48.81 48.7 48.27 48.84 48.77 48.25 48.94 48.91 48.87 DIFFERENCE 0.31 -0.2 -0.41 0.5 -0.01 0.21 0.04 0.05 -0.02 0.12 INR(RS) 10794.5286 -2875.406 -9438.0278 7904 -124.3385 18086.6448 719.968 1823.9735 -823.4956 2943.006 29010.853

98

M o n th o f J a n u a ry 2 0 0 9
4 9 .2 49 4 8 .8 4 8 .6 4 8 .4 4 8 .2 48 4 7 .8
09 09 09 09 nnnnn09

Rate

F O RW AR D R AT E P R E V A IL ING R A T E

-Ja

-Ja

-Ja

-Ja 27

04

11

16

D ate

Chart no.22 Chart showing the comparison of forward rate and prevailing rate for the month of January 2009 Inference: Both the forward rate and the prevailing rate had seen more fluctuations through the entire month due to the unfavourable market conditions.

30
99

-Ja

Effective utilization of foreign currency in TNPL for the month of February 2009: Table no.23 RATE AS EXPORT CR.ADV DATE 03-Feb-09 04-Feb-09 08-Feb-09 12-Feb-09 15-Feb-09 16-Feb-09 21-Feb-09 21-Feb-09 23-Feb-09 25-Feb-09 27-Feb-09 INV IN USD 52745.62 54745.16 29896.02 79420 53956.81 32342 48904.8 47941 51437 54056.5 96827.54 PER FORWARD RATE 48.91 48.94 48.91 49.02 49.06 49.09 48.48 48.37 48.89 49.46 49.94 NET INR PREVAILING RATE 48.94 48.81 48.81 48.76 49.42 49.67 48.54 48.57 48.63 48.83 49.63 DIFFERENCE -0.03 0.13 0.1 0.26 -0.36 -0.58 -0.06 -0.2 0.26 0.63 0.31 INR(RS) -1582.3686 7116.8708 2989.602 20649.2 -19424.4516 -18758.36 -2934.288 -9588.2 13373.62 34055.595 30016.5374 55913.757

100

M o n th o f F eb ru a ry 20 0 9
50.5 50 49.5 Rate 49 48.5 48 47.5
04 -F eb 12 09 -F eb -0 9 16 -F eb 21 09 -F eb 25 09 -F eb -0 9

F O R W A RD RA TE P RE V A ILIN G R A TE

Da te

Chart no.23 Chart showing the comparison of forward rate and prevailing rate for the month of February 2009 Inference: The prevailing rate was decreased first and it increased in 16th February, and then it increased but the rate of increase was lesser than the forward rate.

101

Table no.24 NET INR FOR THE YEAR 2008 APRIL MAY JINE JULY AUGUST SEPTEMBER OCTOBER NOVEMBER DECEMBER JANUARY FEBRUARY NET INR -35.3453 13598.4684 -29924.5678 30040.919 43710.0003 63894.8174 47307.3902 115770.9803 136779.1802 29010.853 55913.767 506066.4627

102

Ne t INR fo r the ye a r 2 00 8
160000 140000 120000 100000 80000 60000 40000 20000 0 -20000 -40000

INR(RS)

S eries1

Inference: For the year 2008-09, there is a net INR in the month of June and starts increasing and reaches its maximum in the month of December and ends in positive net INR.

AP RI L MA Y JIN E JU LY A SE UGU PT S EM T OC BER T NO OB VE ER DE M B CE ER MB JA ER N FE U A R BR Y UA RY

Mo n th s

Chart no.24 Chart showing net INR of TNPL in 2008-09

103

Effective utilization of foreign currency in TNPL for the month of April 2009: Table no.25 RATE AS EXPORT CR.ADV DATE 17-Apr-09 28-Apr-09 23-Apr-09 23-Apr-09 23-Apr-09 23-Apr-09 INV IN USD 15638.22 16934.75 11593.38 19622.25 18824.96 16115.3 PER FORWARD RATE 50.8800 50.4500 51.4000 51.3000 50.4500 50.4500 TOTAL PREVAILING RATE 49.9952 50.5189 50.8090 50.8090 50.8090 50.8090 DIFFERENCE 0.8848 -0.0689 0.5910 0.4910 -0.3590 -0.3590 INR(Rs) 13836.6971 -1166.8043 6851.6876 9634.5247 -6758.1606 -5785.3927 16612.5518

104

Month of April 2009


52 51.5 51 Rates 50.5 50 49.5 49 17- 28- 23- 23- 23- 23Apr- Apr- Apr- Apr- Apr- Apr09 09 09 09 09 09 Date FORWARD RATE PREVAILING RATE

Chart no.25 Chart showing the comparison of forward rate and prevailing rate for the month of April 2009 Inference: There was a slight increase in the prevailing rate but the forward rate undergone more fluctuations.

105

Effective utilization of foreign currency in TNPL for the month of May 2009: Table no.26 RATE AS EXPORT CR.ADV DATE 11-May-09 15-May-09 15-May-09 15-May-09 22-May-09 22-May-09 25-May-09 27-May-09 27-May-09 27-May-09 14-May-09 14-May-09 21-May-09 28-May-09 28-May-09 28-May-09 28-May-09 29-May-09 INV IN USD 33462.08 20600.84 19870.92 20997.6 40180.8 79546.97 20521.04 38715.53 46576.51 37101.06 23449.15 79855.47 20232.07 15862.86 15029 73653.27 15994.88 14337.6 PER FORWARD RATE 50.1900 47.2600 49.3400 47.2600 49.5400 49.3400 47.2600 49.2000 47.2600 47.2600 50.4500 50.0200 49.3400 47.2600 47.2600 47.2600 47.2600 47.2600 TOTAL PREVAILING RATE 49.7000 50.0862 50.0862 50.0862 47.6252 47.6252 47.6250 47.7083 47.7083 47.7083 49.8189 49.8189 47.7447 47.7874 47.7874 47.7874 47.7874 47.9166 DIFFERENCE 0.4900 -2.8262 -0.7462 -2.8262 1.9148 1.7148 -0.3650 1.4917 -0.4483 -0.4483 0.6311 0.2011 1.5953 -0.5274 -0.5274 -0.5274 -0.5274 -0.6566 INR(Rs) 16396.4192 -58222.0940 -14827.6805 -59343.4171 76938.1958 136407.1442 -7490.1796 57751.9561 -20880.2494 -16632.4052 14798.7586 16058.9350 32276.2213 -8366.0724 -7926.2946 -38844.7346 -8435.6997 -9414.0682 100244.7349

106

Month of May 2009


51 50 49 Rates 48 47 46 45
15 -M 15 ay-M 09 22 ay-M 09 27 ay-M 09 27 ay-M 09 14 ay-M 09 28 ay-M 09 28 ay-M 09 29 ay-M 09 ay -0 9

FO R W AR D R ATE PR EVAILING R ATE

D ate

Chart no.26 Chart showing the comparison of forward rate and prevailing rate for the month of May 2009 Inference: Both the rates increased and decreased but forward rate had seen more fluctuations than the prevailing rate due to the market expectations.

107

Effective utilization of foreign currency in TNPL for the month of June 2009: Table no.27 RATE AS EXPORT CR.ADV DATE 01-Jun-09 08-Jun-09 08-Jun-09 12-Jun-09 15-Jun-09 18-Jun-09 18-Jun-09 18-Jun-09 18-Jun-09 18-Jun-09 18-Jun-09 24-Jun-09 24-Jun-09 24-Jun-09 25-Jun-09 25-Jun-09 26-Jun-09 26-Jun-09 26-Jun-09 29-Jun-09 29-Jun-09 29-Jun-09 29-Jun-09 29-Jun-09 INV IN USD 41712.57 77686.43 94365.67 15222.4 30928.74 56743.18 15236.14 20620.08 74938.28 236040.8 57193.45 19096.28 163406.25 20670 26429.25 18479.45 31071.71 15957.03 31792.8 10498.4 11217.21 23056 9727.47 30839.42 PER FORWARD RATE 47.2600 46.8900 46.8900 46.7400 46.7400 47.5200 46.7400 46.7400 47.2250 49.3400 46.7400 47.4000 47.3800 47.0450 47.3700 47.3700 47.2250 47.7050 47.7050 47.3700 47.3700 47.7050 47.3700 47.4000 TOTAL PREVAILING RATE 47.6850 47.9050 47.9050 47.9394 48.5000 48.4485 48.4485 48.4485 48.4485 47.9050 48.4485 49.1341 49.1341 49.1341 48.9039 48.9039 48.9686 48.9686 48.9686 49.0800 49.0800 49.0800 49.0800 49.0800 DIFFERENCE -0.4250 -1.0150 -1.0150 -1.1994 -1.7600 -0.9285 -1.7085 -1.7085 -1.2235 1.4350 -1.7085 -1.7341 -1.7541 -2.0891 -1.5339 -1.5339 -1.7436 -1.2636 -1.2636 -1.7100 -1.7100 -1.3750 -1.7100 -1.6800 INR(Rs) -17727.8423 -78851.7265 -95781.1551 -18257.7466 -54434.5824 -52686.0426 -26030.9452 -35229.4067 -91686.9856 338718.5480 -97715.0093 -33114.8591 -286630.9031 -43181.6970 -40539.8266 -28345.6284 -54176.6336 -20163.3031 -40173.3821 -17952.2640 -19181.4291 -31702.0000 -16633.9737 -51810.2256 -913289.0195

108

M o n th o f J u n e 2 0 0 9
50 49.5 49 48.5 48 47.5 47 46.5 46 45.5 45
08 -Ju 18 n-0 -Ju 9 18 n-09 -Ju 24 n-09 -Ju 25 n-0 -Ju 9 26 n-09 -Ju 29 n-0 -Ju 9 29 n-09 -Ju n09

Rates

F O R W AR D R AT E P R E VAILING R AT E

D ate

Chart no.27 Chart showing the comparison of forward rate and prevailing rate for the month of June 2009 Inference: The prevailing rate was more than the forward rate throughout the month except 24th June, which results in negative INR.

109

Effective utilization of foreign currency in TNPL for the month of July 2009: Table no.28 RATE AS EXPORT CR.ADV DATE 01-Jul-09 01-Jul-09 01-Jul-09 01-Jul-09 03-Jul-09 03-Jul-09 06-Jul-09 06-Jul-09 08-Jul-09 08-Jul-09 01-Jul-09 01-Jul-09 09-Jul-09 09-Jul-09 13-Jul-09 13-Jul-09 14-Jul-09 15-Jul-09 15-Jul-09 14-Jul-09 14-Jul-09 14-Jul-09 14-Jul-09 14-Jul-09 14-Jul-09 14-Jul-09 14-Jul-09 16-Jul-09 22-Jul-09 INV IN USD 57273.86 95564.48 76450.65 21809.60 30147.99 15717.79 14829.48 21032.00 36491.39 39806.65 58437.67 29173.57 11606.40 16012.42 15994.88 75410.16 75750.66 77562.66 14838.60 75679.28 56712.95 76022.08 75855.45 02220.32 43992.92 11300.80 29860.99 31410.99 14444.83 PER FORWARD RATE 47.0450 47.0200 47.0200 47.4000 48.0900 48.0900 48.0900 48.0900 47.4000 47.4000 48.5000 48.3500 48.3500 48.5000 47.8300 47.8300 47.8300 48.7000 47.8300 48.3500 48.5000 48.0900 48.0800 48.3500 48.3500 48.0500 47.8300 47.8300 48.5000
110

PREVAILING RATE 48.3927 48.3927 48.3927 48.3927 48.2335 48.2335 48.6550 48.6550 48.8562 48.8562 48.3927 48.3927 49.2037 49.2037 49.6600 49.6600 49.5744 49.2065 49.2065 49.5744 49.5744 49.5744 49.5744 49.5744 49.5744 49.5744 49.5744 48.9814 48.5849 DIFFERENCE -1.3477 -1.3727 -1.3727 -0.9927 -0.1435 -0.1435 -0.5650 -0.5650 -1.4562 -1.4562 0.1073 -0.0427 -0.8537 -0.7037 -1.8300 -1.8300 -1.7444 -0.5065 -1.3765 -1.2244 -1.0744 -1.4844 -1.4944 -1.2244 -1.2244 -1.5244 -1.7444 -1.1514 -0.0849 INR(Rs) -77187.9811 -131181.3617 -104943.8073 -21650.3899 -4326.2366 -2255.5029 -8378.6562 -11883.0800 -53138.7621 -57966.4437 6270.3620 -1245.7114 -9908.3837 -11267.9400 -29270.6304 -138000.5928 -132139.4513 -39285.4873 -20425.3329 -92661.7104 -60932.3935 -112847.1756 -113358.3845 -2718.5598 -53864.9312 -17226.9395 -52089.5110 -36166.6139 -1226.3661

24-Jul-09 24-Jul-09 27-Jul-09 29-Jul-09 29-Jul-09 29-Jul-09 29-Jul-09 30-Jul-09 30-Jul-09 30-Jul-09 30-Jul-09 30-Jul-09 30-Jul-09 30-Jul-09 30-Jul-09 30-Jul-09 30-Jul-09 30-Jul-09

38136.56 31989.76 19852.74 15108.80 15492.37 76250.70 20756.66 29199.71 57041.55 19139.05 29237.96 15109.43 13361.56 17867.62 22303.20 20099.18 14259.38 42338.69

47.8300 47.8300 48.6500 47.8300 47.8300 47.8300 48.6500 47.8300 48.6500 47.8300 48.6500 49.0500 47.9200 47.9200 47.8400 49.0500 48.1800 48.1800 TOTAL

48.6294 48.6294 47.8200 48.4519 48.4519 48.4519 48.4519 48.6125 48.6125 48.6125 48.6125 48.6125 48.6125 48.6125 48.6125 48.6125 48.6125 48.6125

-0.7994 -0.7994 0.8300 -0.6219 -0.6219 -0.6219 0.1981 -0.7825 0.0375 -0.7825 0.0375 0.4375 -0.6925 -0.6925 -0.7725 0.4375 -0.4325 -0.4325

-30486.3661 -25572.6141 16477.7742 -9396.1627 -9634.7049 -47420.3103 4111.8943 -22848.7731 2139.0581 -14976.3066 1096.4235 6610.3756 -9252.8803 -12373.3268 -17229.2220 8793.3913 -6167.1818 -18311.4834 -1575718.38

111

Month of July 2009


50 49.5 49 48.5 48 47.5 47 46.5 46 45.5 01-Jul-09 15-Jul-09 14-Jul-09 03-Jul-09 24-Jul-09 29-Jul-09 30-Jul-09

FORW ARD RATE PREVAILING RATE

Rates

Date

Chart no.28 Chart showing the comparison of forward rate and prevailing rate for the month of July 2009 Inference: The prevailing rate was increased more than the forward rate in the beginning and then it decreased and reached to a level with the forward rate.

112

Effective utilization of foreign currency in TNPL for the month of August 2009: Table no.29 RATE AS EXPORT CR.ADV DATE 01-Aug-09 02-Aug-09 03-Aug-09 03-Aug-09 03-Aug-09 03-Aug-09 03-Aug-09 03-Aug-09 04-Aug-09 03-Aug-09 03-Aug-09 05-Aug-09 05-Aug-09 05-Aug-09 11-Aug-09 18-Aug-09 19-Aug-09 20-Aug-09 21-Aug-09 22-Aug-09 23-Aug-09 25-Aug-09 25-Aug-09 25-Aug-09 25-Aug-09 25-Aug-09 25-Aug-09 28-Aug-09 29-Aug-09 INV IN USD 19781.19 20353.6 77209.38 16003.02 58399.42 21329.84 114874.01 32024.83 77641.83 16040.32 10936 19248.18 36304.56 2487.3 76738.95 76284.22 2367.5 19730.05 56223.286 75676.43 29160.872 31229.18 45834.3 14599.85 57000 71250 15614.592 28783.17 48016.09 PER FORWARD RATE 48.3550 48.3550 48.3550 47.9200 47.9200 49.0500 48.3100 48.3550 48.0800 47.9200 48.3550 47.5000 47.5000 47.5000 47.5000 48.3100 48.3100 47.9200 47.9200 47.9200 48.3550 49.0500 48.3550 48.3550 48.6200 48.6200 47.9200 47.9200 48.3100
113

PREVAILING RATE 48.3225 48.5200 48.5200 48.5200 48.5200 48.5200 48.5200 48.5200 48.0658 48.5200 48.5200 47.8279 47.8279 47.8279 48.0702 48.9408 48.9851 49.0263 48.8973 48.7874 49.0950 48.7413 48.7413 48.7413 48.7413 48.7413 48.7413 49.0919 48.9380 DIFFERENCE 0.0325 -0.1650 -0.1650 -0.6000 -0.6000 0.5300 -0.2100 -0.1650 0.0142 -0.6000 -0.1650 -0.3279 -0.3279 -0.3279 -0.5702 -0.6308 -0.6751 -1.1063 -0.9773 -0.8674 -0.7400 0.3087 -0.3863 -0.3863 -0.1213 -0.1213 -0.8213 -1.1719 -0.6280 INR(RS) 642.8887 -3358.3440 -12739.5477 -9601.8120 -35039.6520 11304.8152 -24123.5421 -5284.0970 1102.5140 -9624.1920 -1804.4400 -6311.4782 -11904.2652 -815.5857 -43756.5493 -48120.0860 -1598.2993 -21827.3543 -54947.0174 -65641.7354 -21579.0453 9640.4479 -17705.7901 -5639.9221 -6914.1000 -8642.6250 -12824.2644 -33730.9969 -30154.1045

29-Aug-09 29-Aug-09 29-Aug-09 29-Aug-09 31-Aug-09 31-Aug-09

112984.24 27591.31 10808.97 32024.83 30356.74 18512.6

47.5000 47.9200 47.9200 47.6350 47.6350 47.6350 TOTAL

48.9380 48.9380 48.9380 48.9380 49.3000 49.3000

-1.4380 -1.0180 -1.0180 -1.3030 -1.6650 -1.6650

-162471.3371 -28087.9536 -11003.5315 -41728.3535 -50543.9721 -30823.4790 -795656.8068

M o n th o f A u g u s t 2 0 0 9
4 9 .5 49 4 8 .5 Rates 48 4 7 .5 47 4 6 .5 03-Aug-09 03-Aug-09 04-Aug-09 05-Aug-09 11-Aug-09 20-Aug-09 23-Aug-09 25-Aug-09 25-Aug-09 29-Aug-09 29-Aug-09 F O R W A R D R A TE P R E V A IL IN G R A TE

D a te

Chart no.29 Chart showing the comparison of forward rate and prevailing rate for the month of August 2009

Inference:
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Both the rates increased and decreased but forward rate had seen more fluctuations than the prevailing rate due to the market expectations.

Effective utilization of foreign currency in TNPL for the month of September 2009: Table no.30 RATE AS EXPORT CR.ADV DATE 01-Sep-09 02-Sep-09 03-Sep-09 05-Sep-09 05-Sep-09 05-Sep-09 08-Sep-09 09-Sep-09 10-Sep-09 10-Sep-09 11-Sep-09 12-Sep-09 13-Sep-09 14-Sep-09 15-Sep-09 17-Sep-09 17-Sep-09 17-Sep-09 17-Sep-09 17-Sep-09 17-Sep-09 INV IN USD 15826.86 15826.86 30516.04 19270.8 31786.88 15419.71 163956.03 19991.87 96614.73 26118.06 24937.22 49966.07 188881.82 96695.39 22561.6 19847.97 2202.51 37967.25 32241.86 19137.93 60151.18 PER FORWARD RATE 48.0500 48.2000 48.3550 48.0500 48.6350 48.2000 48.1000 48.2000 48.2000 48.6200 48.6000 48.6000 48.5600 48.6350 48.7200 48.7500 48.7400 48.7400 48.3900 48.7400 48.6000
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PREVAILING RATE 49.3173 49.0746 49.1489 48.9982 48.9982 48.9982 48.8644 48.7560 48.7606 48.7606 48.7992 48.8187 49.1700 49.1700 49.1536 48.5610 48.5610 48.5610 48.5610 48.5610 48.5610 DIFFERENCE INR(RS) -1.2673 -0.8746 -0.7939 -0.9482 -0.3632 -0.7982 -0.7644 -0.5560 -0.5606 -0.1406 -0.1992 -0.2187 -0.6100 -0.5350 -0.4336 0.1890 0.1790 0.1790 -0.1710 0.1790 0.0390 -20057.3797 -13842.1718 -24226.6842 -18272.5726 -11544.9948 -12308.0125 -125327.9893 -11115.4797 -54162.2176 -3672.1992 -4967.4942 -10927.5795 -115217.9102 -51732.0337 -9782.7098 3751.2663 394.2493 6796.1378 -5513.3581 3425.6895 2345.8960

21-Sep-09 21-Sep-09 21-Sep-09 21-Sep-09 21-Sep-09 26-Sep-09 27-Sep-09 28-Sep-09 30-Sep-09 30-Sep-09 30-Sep-09

18478.98 31892.49 13554.6 15889.19 19865.46 19991.07 37891.32 46776.58 16012.42 16012.42 19425.4

48.8400 48.7400 48.7400 48.4450 48.3900 48.7400 48.7400 48.7400 48.3900 48.7400 48.9200 TOTAL

48.9300 48.9300 48.9300 48.9300 48.9300 48.4395 48.8900 48.8900 48.3392 48.3392 48.3392

-0.0900 -0.1900 -0.1900 -0.4850 -0.5400 0.3005 -0.1500 -0.1500 0.0508 0.4008 0.5808

-1663.1082 -6059.5731 -2575.3740 -7706.2571 -10727.3484 6007.3165 -5683.6980 -7016.4870 813.4309 6417.7779 11282.2723 -492868.5961

M o n th o f S e p te m b e r 2 0 0 9
49.6 49.4 49.2 49 48.8 48.6 48.4 48.2 48 47.8 47.6 47.4
05 -S e 09 p-0 -S 9 e 12 p-0 -S 9 e 17 p-0 -S 9 e 17 p-0 -S 9 e 21 p-0 -S 9 e 27 p-0 -S 9 e 30 p-0 -S 9 ep -0 9

Rates

F O R W A R D R A TE P R E V A ILIN G R A TE

D a te

Chart no.30 Chart showing the comparison of forward rate and prevailing rate for the month of September 2009

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Inference: The prevailing rate starts at higher level and then it decreased, whereas the forward rate starts at lower level and then it increased to a higher value.

Effective utilization of foreign currency in TNPL for the month of October 2009: Table no.31 RATE AS EXPORT CR.ADV DATE 01-Oct-09 01-Oct-09 01-Oct-09 04-Oct-09 04-Oct-09 08-Oct-09 04-Oct-09 04-Oct-09 12-Oct-09 16-Oct-09 17-Oct-09 21-Oct-09 22-Oct-09 23-Oct-09 INV IN USD 77327.95 9720.02 76008.13 76757.56 77589.13 76740.5 20828.2 55327.38 114996.31 44609.84 31929.52 113339.88 81477.74 30000 PER FORWARD RATE 48.6350 48.3800 48.7500 48.8400 48.3900 48.2850 48.6300 48.6300 48.7400 48.7400 48.0850 48.7400 47.9450 47.9200
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PREVAILING RATE 48.1539 48.1539 48.1539 48.5105 48.5105 48.9367 48.5105 48.5105 47.0200 46.0621 46.3522 46.3544 46.5855 46.7799 DIFFERENCE 0.4811 0.2261 0.5961 0.3295 -0.1205 -0.6517 0.1195 0.1195 INR(RS) 37202.4767 2197.6965 45308.4463 25291.6160 -9349.4902 -50011.7839 2488.9699 6611.6219

1.7200 197793.6532 2.6779 119460.6905 1.7328 55327.4723 2.3856 270383.6177 1.3595 110768.9875 1.1401 34203.0000

TOTAL

847676.9746

M o n th o f O c to b e r 20 0 9
49.5 49 48.5 48 47.5 47 46.5 46 45.5 45 44.5
01 -O c 04 t-09 -O c 08 t-09 -O ct 04 -09 -O c 16 t-09 -O c 21 t-09 -O c 23 t-09 -O ct09

Rates

F O RW A RD RA TE P RE V A ILING RA TE

Da te

Chart no.31 Chart showing the comparison of forward rate and prevailing rate for the month of October 2009 Inference:

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The forward rate seemed to be constant throughout the month, whereas the prevailing rate decreased more to a great extent and then it was increased to a little bit.

Effective utilization of foreign currency in TNPL for the month of November 2009: Table no.32 RATE AS EXPORT CR.ADV DATE 01-Nov-09 02-Nov-09 03-Nov-09 03-Nov-09 03-Nov-09 07-Nov-09 08-Nov-09 09-Nov-09 09-Nov-09 09-Nov-09 12-Nov-09 13-Nov-09 17-Nov-09 17-Nov-09 21-Nov-09 INV IN USD 29091.44 58893.84 59599.62 44961.68 63492.71 31746.36 10589.13 43938.86 14115.91 30210.57 16421.32 16310.78 35648.58 93815.19 55887.29 PER FORWARD RATE 48.1000 48.1000 46.0600 48.3900 48.1000 48.1000 46.3200 48.1000 46.5200 47.0500 46.3200 46.3200 47.0500 47.0500 46.4000
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PREVAILING RATE 46.9330 47.0100 47.4050 47.4050 47.4050 46.9357 46.9357 46.9357 46.9357 46.9357 46.5371 46.5810 46.2557 46.2557 46.7409 DIFFERENCE 1.1670 1.0900 -1.3450 0.9850 0.6950 1.1643 -0.6157 1.1643 -0.4157 0.1143 -0.2171 -0.2610 0.7943 0.7943 -0.3409 INR(RS) 33949.7105 64194.2856 -80161.4889 44287.2548 44127.4335 36962.2869 -6519.7273 51158.0147 -5867.9838 3453.0682 -3565.0686 -4257.1136 28315.6671 74517.4054 -19051.9772

22-Nov-09 22-Nov-09 22-Nov-09

32266.69 68359.53 41591.88

48.1000 46.8400 46.8400

47.1430 47.1430 47.1430 TOTAL

0.9570 -0.3030 -0.3030

30879.2223 -20712.9376 -12602.3396 259105.7124

Mo n th o f N o vem b er 2009
49 48.5 48 47.5 47 46.5 46 45.5 45 44.5
-N 03 ov-0 -N 9 07 ov-0 -N 9 0 9 o v- 0 -N 9 09 ov-0 -N 9 13 ov-0 -N 9 1 7 o v- 0 -N 9 22 ov-0 -N 9 22 ov-0 -N 9 ov -0 9

Rates

F O RW ARD RAT E PREVAILING RAT E

02

Date

Chart no.32 Chart showing the comparison of forward rate and prevailing rate for the month of November 2009 Inference: The forward rate started at the higher rate in the month of November and then it decreased to a lower value whereas it spot rate started at low and gradually moved till the end of the month without much fluctuations.

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Effective utilization of foreign currency in TNPL for the month of December 2009: Table no.33 RATE AS EXPORT CR.ADV DATE 01-Dec-09 02-Dec-09 03-Dec-09 03-Dec-09 03-Dec-09 03-Dec-09 08-Dec-09 08-Dec-09 08-Dec-09 08-Dec-09 12-Dec-09 13-Dec-09 14-Dec-09 14-Dec-09 18-Dec-09 19-Dec-09 19-Dec-09 19-Dec-09 19-Dec-09 19-Dec-09 INV IN USD 83536.05 16178.29 11398.32 74599.34 75719.53 15720.1 31101.55 16308.05 99218.1 12594.33 61940 58659.13 11534.4 15637.21 61940 47619.53 15404.52 92933.8 18673.58 32610.3 PER FORWARD RATE 46.8400 46.3500 46.4800 46.1750 46.3600 46.1750 46.4000 46.4000 46.3500 46.3500 46.4000 46.8400 45.8000 46.4000 46.8400 46.0800 46.4000 46.3400 46.3400 46.3200
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PREVAILING RATE 46.6548 46.4155 46.3122 46.3122 46.3122 46.3122 46.7012 46.7012 46.7012 46.7012 46.7482 46.4880 46.4900 46.4900 47.0589 47.1563 47.1563 47.1563 47.1563 47.1563 DIFFERENCE 0.1852 -0.0655 0.1678 -0.1372 0.0478 -0.1372 -0.3012 -0.3012 -0.3512 -0.3512 -0.3482 0.3520 -0.6900 -0.0900 -0.2189 -1.0763 -0.7563 -0.8163 -0.8163 -0.8363 INR(RS) 15470.8765 -1059.6780 1912.6381 -10235.0294 3619.3935 -2156.7977 -9367.7869 -4911.9847 -34845.3967 -4423.1287 -21567.5080 20648.0138 -7958.7360 -1407.3489 -13558.6660 -51252.9001 -11650.4385 -75861.8609 -15243.2434 -27271.9939

23-Dec-09 23-Dec-09

41646.5 58107.31

46.1350 46.1350 TOTAL

47.0106 47.0106

-0.8756 -0.8756

-36465.6754 -50878.7606 -338466.0120

M o n th o f D e c e c b e r 2 0 0 9
47.5 47 Rate 46.5 46 45.5 45
03 -D e 03 c-09 -D e 08 c-09 -D e 13 c-09 -D e 18 c-09 -D e 19 c-09 -D e 23 c-09 -D ec -0 9

F O R W AR D R AT E P R E VAILING R AT E

D ate

Chart no.33 Chart showing the comparison of forward rate and prevailing rate for the month of December 2009

Inference: Both the rates started at the same level and gradually moved till 18th December, and then the spot rate increased to a higher value where as the forward rate decreased to the lower value.

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Table no.34 NET INR FOR THE YEAR 2009 APRIL MAY JINE JULY AUGUST SEPTEMBER OCTOBER NOVEMBER DECEMBER NET INR Net INR for the year 2009
1000000 500000 INR(RS) 0
PR A JU

16612.5518 100244.7349 -913289.0195 -1575718.39 795656.8068 -492868.5961 847676.9746 259105.7124 -338466.012 -1301045.237

-500000 -1000000 -1500000 -2000000

LY AU G S U EP S T TE M B ER O C TO B N ER O V EM D BE EC R E M B ER

IL

Series1

M A

JI N

Months

Chart no.34 Chart showing net INR of TNPL in 2009 Inference:

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For the 2009, TNPL has seen major loss in the month of July due to the more negative fluctuation and start increasing in the month of August, still ends in the negative INR due to forward contract rate which is less than the prevailing rate.

Annual profit and loss of TNPL Table no.35 YEAR 2007-2008 2008-2009 2009 NET INR 1606216.812 506066.4627 -1301045.237

2000000 1500000 1000000 Net INR 500000 0 1 -500000 -1000000 -1500000 Year 2 3

YEAR NET INR

Chart no.35 Chart showing annual profit and loss of TNPL

Inference: The net INR of TNPL is maximum for the year 2007-08 and it slightly decreases in the year 2008-09 and it goes negative in the year 2009.
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FINDINGS:

From this present study on exchange rate fluctuation in Tamilnadu

Newsprint and Paper Limited, the researcher learned about forward rate and prevailing rate. The researcher also learned about international exchange rate especially Indian currency and American dollar because in this project the researcher took these two nation's currencies exchange rate fluctuations.

This study also delivers knowledge about forward contract and prevailing From this present day "exchange rate fluctuation in TNPL" the researcher

contract. Apart from this gives idea about international exchange market. noted that the exchange rate fluctuation is not the constant one it should change day by day because the fluctuation in our Indian currency and US $ in the main reason for this exchange rate variations. (e.g. the US $ value for our Indian currency, the forward rate value vary from the prevailing rate value for the month of April 2nd 2008 forward rate of the day was Rs.40.07 but the prevailing rate is Rs.39.97.

The difference between forward and prevailing rate determines the

exchange rate fluctuation of Indian Rupee(INR). The changes may be favourable or unfavourable because the difference between forward rate and prevailing rate values may positive or negative values. Net INR= the relationship between export invoice in US $ and difference between forward rate and prevailing rate.

The next important calculation in this project is to calculate the Net Indian The Net Indian rupee is calculated for the whole month. Finally the

Rupee (Net INR). researcher compared the net INR of 2007-08, 2008-09 and 2009. From this comparison the researcher found that the two financial years profit. Net INR went in negative in the year 2009.

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SUGGESTIONS:
Due to the forward contract, some loss may occur. To compensate such loss on exports we can go for 50% on spot rate and 50% on forward rate basis. The TNPL has the good consistency in exchange rate fluctuation for the last two financial years. The exchange rate fluctuation is kept on growing in TNPL except in 2009.

When compared to the last three financial years (2007-08, 200809 and 2009) the exchange rate fluctuation profit values. The 2007-08 profits were around Rs.1600000 but the 2008-09 profits were declined to Rs.600000 and 2009 as declined to Rs.1300000 because these years suffers from the world economic crisis. The researcher suggests the company should increase its profit level in the upcoming years.

Needed importance on realization of amount against export as much as quicker; it will help to working capital and also production concern.

126

CONCLUSION:

According to this project the researcher have an idea about International Exchange Market, Foreign Exchange Market and Indian Exchange Market.

Apart from this the researcher know very well about spot rate and forward rate, spot contract and future contract, Indian Rupee(INR) and Net Indian Rupee(Net INR).

This project is very useful for the researcher studies, and it provides more knowledge about the study purpose as well as general purpose.

This project gaining more information to me knows about the exchange rate fluctuation. Finally the researcher concludes the Exchange Rate Fluctuation in Tamilnadu Newsprint and Papers Limited calculates the foreign currency value in to the Indian currency value.

So, Exchange Rate Fluctuation in TNPL is appreciating the export to the foreign countries. The export not only increases the TNPL's product as well as it increases our national income.

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BIBLIOGRAPHY:

JOURNALS: Sullivan, Arthur, Steven M. Sheffrin (2003) Economics Principles in action. Structural change and Economic Dynamics; Volume issue. 1. Fabrizio Coricelli Journal of banking & Finance, Volume 30, issue 12. Balazs Egert, Kirsters Lommatszsh Economic Systems, volume, issue 3. David M. kemnae, Saktinil Roy. Carnegie Rochester conference series on public policy, volume-41. Alan C Stockman

BOOKS:

Chandra Prasanna. "Fundamentals of Financial management", 3rd Edition Tata McGraw-Hill publishing company R.K. Sharma, Shashi K. Gupta. "Financial Management", 3rd Edition. kalyani Publishers

REPORTS: Tamilnadu Newsprint and papers limited's Annual Reports. RBI's Exchange Rate news in "The Hindu" Financial Management by Prof. I.M Pondey.

WEB SITES:

www.tnpl.com www.ssrn.com www.scribd.com www.forex.com

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