4. Business Description

Type of product and service

Products

1. Reinforcement Bars (“Rebars”)

The products consist of the round bars and deformed bars with diameter
of sizes 6-25 mm. and 10-40 mm., respectively. The round bars are
produced in accordance with Thai Industrial Standards Institute (TIS)
No. 20-2543, grade quality: SR 24 and deformed bars are produced in
accordance with Thai Industrial Standards Institute (TIS) No. 24-25
2548, grade quality, SD 30, SD 40 and SD 50. Deformed bars serve various
purposes for construction industry mostly for reinforcement of concrete
such as road, bridge, footing, buildings, houses and general use for
construction industry, etc.

2. Low Carbon Wire Rods (“LCWR”)

LCWR is of grade quality: SWRM 6-22, SWRY11 and SWRCH6A-22A. The size
range is 5.5-16 mm. and they are produced in accordance with Thai
Industrial Standards Institute (TIS) No. 348-2540, JIS G3503 (1980) and
JIS G3507 (1991) respectively. They are used as raw materials for
construction parts such as binding wire, nails, wire mesh, galvanized
wire, barbed wire, welding wire, cold drawn wire, screw and nuts, etc.

3. High Carbon Wire Rods (“HCWR”)

HCWR is of grade quality: SWRH 27-82. The size range is 5.5 - 19 mm. and
it is produced in accordance with Thai Industrial Standards Institute
(TIS) No. 349-2548. They are used as raw materials for manufacturer of
PC wires and PC strands, compression spring, extension spring, torsion
spring, sling etc.

4. Small Sections

Small sections have various forms such as angles or channels. They are
produced in accordance with Thai Industrial Standards Institute (TIS)
No. 1227-2539, grade quality: SS400 (Angles and Channels), SS540
(Angles). They serve various uses of construction industry e.g. roof
structures, electricity poles and billboards etc.

5. Special Bars Quality (“SBQ”)

SBQ is round steel bar in plain carbon steel in the size range of
ranging 9 – 40 mm. They are produced in accordance with JIS G3101 (1995)
for SS400 grade for general usage and JIS G4051 (1979) for S10C – S50C
grade for special usage. These products serve automotive and general
engineering sector.

6. Cut and Bend (“CAB”)

Cut and Bend Services are ready to use produced from our quality Rebars
construction products as material to serve customer’s requirements which
assist them with time saving, labor and transportation cost reduction
and better yields.

Management Standard System

TSTH’s subsidiaries consisting of SISC, SCSC and NTS have adopted
international standards. SISC and SCSC are certified to ISO 9001 : 2008
and NTS is certified to ISO 9001 : 2000 (International standard in
Quality Management Systems). In addition, the Company realizes the
importance of the environment control and therefore SCSC is certified to
ISO 14001 : 2004 (International standard for the environmental control)
and NTS is certified to ISO/IEC 17025 : 2005 (General requirements for
the competence of testing and calibration laboratories). The Company is
well aware of the importance of the safety in the working environment
for its employees. SISC and SCSC are certified to TIS 18001 : 2542 &
OHSAS18001 : 2007 (International standard of Occupational Health and
Safety Management Systems).

During, in 2011, TSTH’s Marketing and Sales Department also received ISO
9001 : 9008 certificate with ongoing surveillance survey and internal
control.

Privileges through the BOI Program

The Company can enjoy certain privileges from the BOI and its
subsidiaries as of March 31, 2011 as follows:

+------------+-------------+-------------------------------------------+
|            | Production  | Privileges Received                       |
|            | Volume      |                                           |
|            |             |                                           |
|            | (tons per   |                                           |
|            | annum)      |                                           |
+------------+-------------+-------------------------------------------+
| NTS        | 520,000     | -   Tax exemption for 8 years from the    |
|            |             |     commencement of operation (2006 -     |
| Phase II   | 500,000     |     2013)                                 |
|            |             |                                           |
| MBF*       |             | -   Net loss incurred between 1^(st) –    |
|            |             |     8^(th) year can be realized against   |
|            |             |     taxable profits during the next 5     |
|            |             |     years.                                |
|            |             |                                           |
|            |             | -   Tax exemption for 8 years for the net |
|            |             |     profit from the first income          |
|            |             |                                           |
|            |             | -   Net loss incurred between 1^(st) –    |
|            |             |     8^(th) year can be realized against   |
|            |             |     taxable profits during the next 5     |
|            |             |     years.                                |
+------------+-------------+-------------------------------------------+

* Mini Blast Furnace Project

Market Situation and Competition

Domestic Market

1. Rebars

The products are being distributed through dealers in Bangkok and
surrounding provinces, up country dealers and direct to contractors and
project owners.

2. Wire Rods

LCWR, the low carbon wire rods category is supplies to the producers of
finished goods like nails, fences, mesh etc. The special wire rods like
HCWR, MCWR, Y11 and CHQ are supplied to wire drawers who make finished
goods such as PC wire, PC strand, electrodes fasteners. These are direct
sales to the customer accounts.

3. Special Bar Quality

The company sells direct to manufacturers who serve automotive and
general engineering sector and bright bar makers.

4. Small Sections

The existing distribution channel for this type of product is through
dealers who in turn re-distribute to the construction contractors and
fabricators. At times, we also carry out direct sales to customer
accounts.

5. Cut and Bend

This product is a special service provided to contractors whereby shaped
steel is supplied directly to the project site based on bar cut list
obtained from the customers.

Export Market

The company exports Rebars and Wire Rods to the neighboring countries
such as Laos, Myanmar, Cambodia, India, Vietnam, Indonesia and the
Philippines through an existing, market specifie distribution network,
located in the foreign country.

Proportion of production distribution

Given below is the proportion of rebar sold through the 3 channels that
we have in market places.

  ------------------------- -------------- -------- --------- -------- --------
  Distribution Channels     % to                                       
                            distribution                               

                            FY12           FY11     FY10      FY09     FY08

  Direct Sales              8%             7%       8%        11%      9%

  Retail Trade              54%            35%      36%       34%      35%

  TSTH Dealers              34%            58%      56%       55%      56%

  Total                     100            100      100       100      100
  ------------------------- -------------- -------- --------- -------- --------

Industry Outlook and Competition

Competition

Domestic Market

The Company’s competitors can be divided into two groupsnamely the
manufacturers with Electric Arc Furnace (EAF) and Non-EAF manufacturers
or re-rollers. Those who have EAF procure the scrap both domestically
and internationally as it is used as a production raw material to
produce semi-finished goods namely, billets, which in turn is used to
produce finished products i.e. rebars, wire rods, small sections and
special bars. Re-rollers, on the other hand, use billets to produce the
finished goods.

In terms of overall production capacity of the long steel industry, it
is estimated that the supply has far outstripped local demand, mainly
due to the fact that the there are many rebar producers in the market
which results in severe competition in rebar category. As for the
domestic wire rod producers, there are 3 to 4 local producers and the
high quality wire rods are imported from China, Japan, South Korea, etc.

The list of all long product producers in Thailand with their capacities
(as at December 31, 2011)

  (Tons per annum)

  ---------------------------- ------------ ------------ ------------ -----------
  Company                      Production                             Melting
                               Capacity of                            Capacity
                               Long                                   
                               Products                               

                               EAF Rolling  Non-EAF      Total        
                               Capacity     Rolling                   
                                            Capacity                  

  Tata Steel (Thailand) (TSTH) 1,700,000    -            1,700,000    1,500,000

  Bangsaphan Barmill (BSBM)    -            700,000      700,000      -

  Bangkok Steel Industry (BSI) 750,000      -            750,000      300,000

  Bangkok Iron and Steel Works 500,000      -            500,000      240,000
  (BISW)                                                              

  Tycoon (TYCN)                -            500,000      500,000      -

  Burapa Steel (BRP) / MILLCON -            550,000      550,000      500,000
  (MCST)                                                              

  Namheng Steel (NHS) / Zubb   800,000      -            800,000      300,000
  Group                                                               

  BNS Steel Group (BNS)        240,000      -            240,000      250,000

  Union Metal Limited (UMC)    200,000      -            200,000      420,000

  Siam Steel Syndicate (SSS)   200,000      -            200,000      110,000

  Triumph Steel (Triumph) /    120,000      -            120,000      120,000
  Paisarn Steel                                                       

  Thai Steel Bar (GS)          120,000      -            120,000      120,000

  Thai-India Steel (TICO)      72,000       -            72,000       78,000

  Thai Steel Profile (TSC)     -            240,000      240,000      -

  Siam Yamato Steel (SYS)      1,340,000    -            1,340,000    1,400,000

  Nova Steel                   -            240,000      240,000      -

  Prapadaeng Shape Steel       -            300,000      300,000      -

  BP Wire Rods (SSI)           -            280,000      280,000      -

  Kasemsak Trading (KST)       100,000      -            100,000      100,000

  Others (e.g. RSM, Sahamitr,  -            3,978,000    3,978,000    132,000
  TDC, CVS, TSSI)                                                     

  Total Capacity               6,142,000    6,788,000    12,930,000   5,570,000
  ---------------------------- ------------ ------------ ------------ -----------

Source: Iron and Steel Institute of Thailand (ISIT)

International Market

The company is focused only on a few markets like Cambodia, Laos, India
and Indonesia for its exports to maximize its net revenues. A good
distribution network set up has helped the company to achieve good
prices for its brand TATA TISCON. Since we maintain a consistent
presence, we get repeat business from our loyal customers in asean. The
competition is mainly from local domestic mills and China.

Industry Outlook

Long Steel Product Industry overview for the year 2011-2012

Thailand GDP grew by 0.1% in 2011 and this low GDP was due to the
unprecedented floods that impacted Thailand during October-December
2011. As a matter of fact the GDP contracted by 9% during the flooding
period. The long product growth was mere 3% compared to 11% in 2010.
Also, construction growth was -2.8% as compared to 6.8% in 2010. Many
mega projects that were planned for execution in 2011 could not take off
as there was a change in the government at the center and many policies
came under review by the new government leading to delay in financial
closures for construction projects.

Steel Industry outlook for the year 2012-2013

GDP of Thailand is expected to grow by 5.5%. Export and tourism sectors
are expected to recover in 2012. The government is planning several mega
projects to improve country’s infrastructure and to support the
rehabilitation from the flood crisis as well as creation for flood
prevention in its budget spending plans and is expected to commence in
the first quarter of FY 2013.

Overall steel consumption is expected to be 15.3 Million Tons in 2012,
an increase of around 4% over 2011. In terms of long products, the
picture shown below shows how the domestic production has steadily come
down over the last few years and imports have grown causing pressure on
margins and capacity utilization with domestic producers.

Local long product consumption during the year 2009 - 2011

  ---------------------- ---------------------------- -------------------
  Year                   Long Products (Tons)         Growth (%)

  2011                   4,761,497                    3.0

  2010                   4,620,143                    11.5

  2009                   4,143,557                    -23.5
  ---------------------- ---------------------------- -------------------

Source: Iron and Steel Institute of Thailand

While, imports have also caused trouble in Flat products, robust growth
in Automotive segment has augured well for Flat product producers
compared to long products. Construction Industry is also expected to
register YoY growth of 5-6% and this growth will be driven by
residential, commercial and Govt aided projects to support
infrastructure projects such as the metropolitan electric train which
includes the blue, red and purple lines. It is expected that these
projects will continue through 2012. In residential sector, the first
house policy with stable interest rate should result in growth.
Accordingly, Cement consumption is expected to be 29-30 MT as compared
to 28 MT last year.

Product/service procurement

Manner of product procurement

Production capacity and plant location

Plant and location

N.T.S. Steel Group Plc.

No. 351, Moo 6, 331 Highway, Hemaraj Chonburi Industrial Estate, Tambon
Bowin, Amphoe Sri Racha, Chonburi Province

Siam Iron and Steel (2001) Co., Ltd.

No. 49 Moo 11, Tambon Bang Khamode, Amphoe Ban Mor, Saraburi Province

Siam Steel Construction Co., Ltd.

Plot No. I-23, Map Ta Phut Industrial Estate, Amphoe Muang, Rayong
Province

Procurement

Procurement of metallic scrap, steel billets, raw materials, goods for
maintenance, repair and operations (MRO Goods), services and logistics,
is done by a dedicated Procurement Team of around 50 professionals,
located in the Bangkok Head Office (Rasa Tower 2, 20th Fl) and at 3
steel making sites in Saraburi (SISCO), Rayong (SCSC) and Chonburi
(NTS).

Procurement is a centralized function within the Tata Steel Group, and
as such the VP Procurement of Tata Steel (Thailand) is a member of the
Global Procurement Management Team. On many spend categories there is a
co-operation with Tata Steel Procurement colleagues around the globe to
derive synergies and benefits of group buy.

In line with the Group Procurement strategy, Tata Steel Thailand is
focused on continuously improving its Procurement processes by
implementing dedicated Procurement strategies per spend-category,
increase strategic sourcing contract coverage and supplier relationship
management for selected strategic spend categories and vendors.
Automation of repetitive ordering processes is integral part of these
change processes, aimed at reducing costs and time, which in turns
allows for more time to work on strategic sourcing, In this light, the
Procurement staff is being trained on these processes, tools and
techniques.

TSTH emphasizes on strict compliance to the TCOC (Tata code of conduct)
and responsible procurement policy, as the embedded standard across the
Group.

The responsibility of procurement policy has five areas to guide
sourcing activities, namely :

-   Conduct our business with responsibility, integrity and respect,
    maintaining high ethical standards.

-   Provide a safe, healthy for procurement employees and stakeholders.

-   Generate economic value through enhancing what we offer to our
    customers.

-   Care of Social Environmental, working with our customers and our
    suppliers to improve the environment of our products over their full
    life cycle by maintain Carbon Dioxide (CO2) emissions to less than
    1.0 Ton / ton of liquid steel.

-   Make a positive impact on the communities where we operate.

Procurement Division in Tata Steel (Thailand) is organized as per the
spend in major 5 functions, focusing on different spend categories :-

Metallics

Represents over 80% of the total spend of TSTH. Sub categories include
domestic scrap, imported scrap and billets, in various grades. Basic
strategy is to maximize domestic scrap sourcing, and source imported
scrap in close co-operation with the global Tata Steel Procurement
network. The domestic scrap supply market is segmented in categories and
the Metallics procurement team has developed tailored commercial
strategies for these segments, thereby supporting the overall metallics
procurement strategy of maximizing the Value-In-Use for each of the
plants.

Raw Materials

TSTH’s Raw Materials Procurement team is handling the procurement of
Iron Ore, Metallurgical Coke, Coal, Ferro Alloys and other additives,
used for both the Mini Blast Furnace and the Electric Arc Furnace. Most
of these items are sourced in close cooperation with Hubs in the India
Singapore UK and the Netherlands.

Key strategy is to find the right source of supply with optimum value
and price combination for TSTH operations.

Maintenance Repairs and Operation Material

This department is predominantly working on sourcing (technical) MRO
Goods, including Graphite Electrodes, used for melting the scrap in the
EAF’s, refractories, bearings, rolls, Fuel and Fluid Systems, Water
Treatment System, Natural Gases, Filter, Belt-Chain and etc. These
categories typically require close co-operation between (plant)
engineers and the procurement team. To serve the (internal) end users
with smooth and flexible procurement processes, this department has
staff stationed at the plants,

allowing close collaboration, ensuring the highest service levels to
meet and exceed the customer’s expectations.

Inbound Logistics and Services

Inbound Logistics and related services to handle import scrap. This team
works in close co-operation with the Tata Steel Group Shipping &
Logistics team. Key goal is to manage inbound logistics in such a way
that all cargoes will reach the end users on time, against optimal
costs, in the safest way. This is just as valid for the logistics
services in the plants, where safety controls for the employee and all
other stakeholders including sub-contractor is key. Therefore,
harmonization with company policies is a key goal, with the ultimate
goal of eliminating any harm to people.

Production capacity and policy

Detail below indicating the production capacity and policy by each
subsidiary:

+--------------------------------+--------+--------+--------+--------+
|                                | NTS    | SISC   | SCSC   |        |
|                                |        |        |        |  Total |
+--------------------------------+--------+--------+--------+--------+
| Capacity (tons per annum)      |        |        |        |        |
+--------------------------------+--------+--------+--------+--------+
| - Rebars                       | 4      | -      | 5      | 9      |
|                                | 00,000 |        | 00,000 | 00,000 |
+--------------------------------+--------+--------+--------+--------+
| - Wire rods                    | 4      | 2      | -      | 6      |
|                                | 00,000 | 30,000 |        | 30,000 |
+--------------------------------+--------+--------+--------+--------+
| - Small Sections               | -      | 1      | -      | 1      |
|                                |        | 70,000 |        | 70,000 |
+--------------------------------+--------+--------+--------+--------+
| Total capacity                 | 8      | 4      | 5      | 1,7    |
|                                | 00,000 | 00,000 | 00,000 | 00,000 |
+--------------------------------+--------+--------+--------+--------+

Source: Tata Steel (Thailand) Plc.

With the total Finished goods production of 1,206,034 Tons, the
production capacity utilization for the period ending on March 31, 2012
stood at 70.94%.

Production Process and Production Technology

Production diagram indicating the production process of rebars, wire
rods and other types of steels of the Company.

+-------------------------------+--------------------------------------+
| 1.  Prepare the scrap for     |                                      |
|     melting taken the size    |                                      |
|     and quality into          |                                      |
|     consideration to suit     |                                      |
|     Electrical arc furnace    |                                      |
+-------------------------------+--------------------------------------+
|                               |                                      |
+-------------------------------+--------------------------------------+
| 2.  Melting the scrap and     |                                      |
|     change it in form of      |                                      |
|     liquid metal at           |                                      |
|                               |                                      |
|   the temperature 1,650°C     |                                      |
+-------------------------------+--------------------------------------+
|                               |                                      |
+-------------------------------+--------------------------------------+
| 3. Mix other additives        |                                      |
| including Manganese and       |                                      |
| Carbon etc.                   |                                      |
+-------------------------------+--------------------------------------+
|                               |                                      |
+-------------------------------+--------------------------------------+
| 4. Casting process to make    |                                      |
| billets                       |                                      |
|                               |                                      |
| (Partial billets will be      |                                      |
| stored up and some will be    |                                      |
| brought to rolling process    |                                      |
| for energy saving purpose.)   |                                      |
+-------------------------------+--------------------------------------+
|                               |                                      |
+-------------------------------+--------------------------------------+
|                               | Stock storage                        |
+-------------------------------+--------------------------------------+
|                               |                                      |
+-------------------------------+--------------------------------------+
| 5.  Bring billets reheating   |                                      |
|     in the temperature of     |                                      |
|     1,200°C and rolling with  |                                      |
|     rolling machine to        |                                      |
|     produce rebars, wire rods |                                      |
|     and                       |                                      |
|                               |                                      |
| other steel products in size  |                                      |
| required                      |                                      |
+-------------------------------+--------------------------------------+
|                               |                                      |
+-------------------------------+--------------------------------------+
| 6.Cooling process for Packing |                                      |
+-------------------------------+--------------------------------------+

Production process by Electric Arc Furnace (EAF) method

1.  Scrap Process

Prepare the scrap for melting, taking into consideration the size and
quality to suit the Electrical arc furnace.

2.  Process of Electric Steel Making

Prepare the electrode into electrical arc furnace and apply the high
voltage of electricity for melting the scrap and change it in the form
of liquid metal at temperature of 1,650°C for approximately 45-60
minutes for each melting time.

3.  Process of Metallurgy

-   Prepare liquid metal arising from step 2 process and release it in
    the ladle furnace by way of Eccentric Bottom Tapping to make liquid
    metal pure.

-   Process of (2) and (3) will be controlled by computerized system.

-   Mix with other additives to yield the required liquid metal.

4.  Continuous Casting Process

Bring hot metal arising from step 3 process and have it passed through
the continuous casting process to make billets of 130 to 150 mm. by
controlling cool water system to produce the required billets. Partial
billets will be stored up and some will be brought to rolling process
for energy saving purpose.

5.  Rolling Process

Bring Billets for reheating in the temperature of 1,200°C and have them
passed through the rolling process by rolling machines to get the
reduction in shape and size. There are three forms of production line
namely:

Method 1: Rolling to be in straight of round bars and deformed bars

Method 2: Rolling to be wire rods

Method 3: Rolling to be small sections and rebars

6.  Packing Process

-   Rebars and Small sections

Bring rebars and small sections and have them laid down for cooling
purposes to ease the cutting to the required length for packing and
dispatch.

-   Wire rods

Bring wire rods to bind, weigh and paste it with sticker for storing and
dispatched purposes.

Environmental Impacts

The Company has policies laid down and given to its subsidiaries to
maintain all machineries/equipments in proper and efficient conditions
to preserve environment. Any defective machineries and equipments found,
the Company will immediately amend and repair such defects.
Additionally, the Company hires an environment consulting Company to
take charge in testing the quality of air and water frequently to comply
with specified Laws and Regulations.

The result of the environment testing (air and water) of NTS, SISC and
SCSC is in compliance with all of the Laws and Regulations as specified
by Authorities.

Presently, the Company has no legal dispute or lawsuits relating to
environment problems.

Work related to project or high value of purchases and sales pending the
delivery

- Not Available -