4.

PRICING POLICY BASED ON PRODUCT COLD ROLLED : a) Six Monthly Pricing : MARUTI SUZUKI Vendors are our main business for Cold Rolled. The prices are decided after taking inputs from headquarters and then negotiating with Maruti Suzuki. All volumes that are supplied to MSIL vendors are based on the prices agreed with Maruti Suzuki. The period of contract most of the times is for a period of 6 months. Maruti signs minutes of the meeting with all steel suppliers . Based on the minutes of the meeting , internal approvals are taken from the management. MSIL finalises sheet prices for D, DD, EDD and IF grades. The slit coil prices are INR 500 lower than the sheet prices. These prices are applicable from the dispatch date and are applicable for all dispatches made during the contract period. Grade D/CSP1D-S DD/CSP2S EDD/CSP3NS IF/CSP3E-S Extra X X+500 X+1200 X+2800

b) Quarterly Pricing : We follow quarterly pricing for Harsha Engineers, Whirlpool ,Videocoon and Automax. The pricing are done on the basis of Input prices, Market scenario . Once prices are finalized either we get the contract signed or internal approval is taken on the PO issued by the customer . c) Monthly Pricing : For all the other Cold Rolled customers we do monthly pricing. A general price guideline is issued every month based on market situation and competitive scenario. This forms the basis of negotiation with the customer. The negotiations are done with the customer for supplies . These are specific to the customer and may be higher or lower than the guideline. The customer issues PO for supplies which are internally approved . The quantities if not supplied during the month and carried forward for supplies till the quantity against the Purchase Order are completed. In Addition to above we have started business with Tata Motors in Uttranchal from April 2011 where CIF rates are fixed between Tata Motors and Samsung Trading after discussion with headquarters. The INR prices are build us on the basis of CIF prices , Exchange rate at the time of clearing of goods and other charges are built up on the CIF prices.

The above forms almost 50% of the business volumes.

STAINLESS STEEL: Hero Honda is our main business for Stainless Steel.(Now Hero Motor Corp). The prices are decided between POSCO headquarters /POSCO _IDPC and Hero Honda . Hero Honda decides the price for supplies to all its vendors. The grades that we supply are 409L/EN 1.4602 are mainly for exhaust. C&F prices are decided for the quarter. The C&F prices form the base for INR prices. INR prices are arrived at by a mutually agreed formula where in exchange rate changes for every month. So keeping C&F prices same , lot wise pricing on the monthly basis is done in INR. The order quantity is specified by HHML. So HHML has obligation for the ordered quantities. Internal approvals are taken month wise which form the guideline for supplies. HHML vendors form almost more than 90% of the business. Extras are build up in the C&F prices . All other stainless steel customers except high sea sales are governed by quarterly prices for which internal approval is taken every quarter. ALCOSTA/ALZASTA/PPGL: All this material is procured from our subsidiary POCOs. The pricing in the year 2010 was being done on quarterly basis , however due to volatility POCOs shifted to monthly pricing. Based on the input prices and market situation, the prices are decided on monthly basis. In case of PPGL we have competition from local producers . So market prices work as an import factor for deciding PPGL prices. All price guidelines are approved by GM(M&S) . Most of the prices that are settled are on monthly basis. Specification Item Alcosta Alzasta (1.55mm) Alzasta (0.47-0.5 mm) PPGL (RMP) Grade JISG3314,SA1D 080 ASTM A792.AZ185 ASTM AZ150 A792,

ASTM

A792,AZ150 PPGL(SMP) ASTM A792,AZ 150

Extras are charged INR 2000/mt in case of Alcosta 0.4 mm to 0.6 mm. For all other grades we take CFR prices for arriving at final prices which has extra already build in CFR prices. We also have prices as per final product. Final Product Mother Coil Slit Coil Cut Length Extra x X +1000 to X+2000 X+ 3000

Cut to Size

The above are general guideline and the prices settled with the customer may be higher or lower than the guideline. In all such cases Purchase Order issued by the customer are approved by management. ELECTRICAL STEEL: CRNO : CRNO major business is for 1300 grade Customer Tecumseh and 600 grade LG Electronics. We have quarterly contracts with these customers.The contracts specifies the volumes and prices. The prices are applicable till the time the volumes against the contract are supplied. 1300 grade is the base grade and extra is 60 dollars above 1300 grade for 600 grade. The prices are arrived at depending on input prices , market scenario ie competitive prices . With LGIL the C&F prices are settled between LGIL and LG trading/POSCOand POSCO-IDPC arrives at INR prices on the basis of formula . Tecumseh prices are done on the basis of market prices. All other customers pricing are done on monthly level and Purchase orders are approved by the management. CRGO : The basis of pricing CRGO is market prices of the product and competitive scenario. HOT ROLLED PICKELED AND OILED

HRPO prices are governed by monthly price approvals. The pricing for HRPO is done on the basis of Competitor prices. All price approvals approved by GM (M&S) on monthly basis. Grade HRPO D HRPO DD HRPO EDD Extra X X+ 500 X+1500

HRPO-SAPH 440 X+2500 The guidelines work as reference for negotiation and prices closed above or below guideline ,all Purchase Orders are approved by Management.