Gujarat Ambuja Cements Limited

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Gujarat Ambuja Cements Limited
Monday, February 5, 2007
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Contents

• Indian Economy - A Promising Business Opportunity
• Cement Industry - At a glance
• Demand Drivers
• Ambuja Cement - An Overview
• Key Financials - Quarterly Results YTD
• Our Scorecard
• Share Price Performance
• Future Growth Plans

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Contents

• Indian Economy - A Promising Business Opportunity
• Cement Industry - At a glance
• Demand Drivers
• Ambuja Cement - An Overview
• Key Financials - Quarterly Results YTD
• Our Scorecard
• Share Price Performance
• Future Growth Plans

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Indian Economy

• One of the fastest growing economy in the world
• In a sustainable high growth mode
• Growing domestic market
• Changing demography 70 of Indias population
  is below 35 years of age.
• Shift from primarily an agrarian to service
  economy
• Emerging as a service provider to Globe

India is moving from an emerging market to an
emerged market
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GDP Growth likely to sustain at over 8
_______Year 2005-06________
Q1 2006-07
________Year 2004-05 _______
Q2 2006-07

• Growth driven by two engines - Consumption
  Investment
• Indian economy grew at 9.1 in half year 2006

Source CSO
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Contents

• Indian Economy - A Promising Business Opportunity
• Cement Industry - At a glance
• Demand Drivers
• Ambuja Cement - An Overview
• Key Financials - Quarterly Results YTD
• Our Scorecard
• Share Price Performance
• Future Growth Plans

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Cement Industry At a Glance CY 2006
YOY Growth
Cement Capacity 165.11 Mn.Tonnes
5.09
Clinker Production 119.71 Mn.Tonnes
4.16
Cement Production 152.35 Mn.Tonnes
11.5
Cement Demand 151.84 Mn.Tonnes
11.34
8.5 (E)
GDP
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Capacity Utilization Highest in Last 10 years
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From Fragmentation to Consolidation
Top 5 players
1995
2006
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Import Parity
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Contents

• Indian Economy - A Promising Business Opportunity
• Cement Industry - At a glance
• Demand Drivers
• Ambuja Cement - An Overview
• Key Financials - Quarterly Results YTD
• Our Scorecard
• Share Price Performance
• Future Growth Plans

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Demand Drivers

• Investment in India Core Themes
• Capital spending continues to be strong
• Uptrend in industrial cycle Avg. IIP growth at
  10.2 being strongest in the past 11 years.
• Strong underlying strength reflected in secular
  rising trend in the Indian Capital market.
• Emphasis on infrastructure US 320Billion
  planned expenditure.
• Real Estate Backed by IT/ITES leading to
  development of Tier II cities
• Retail Malls Multiplexes
• World gaining confidence in Indian economic
  growth
• Buoyant returns on account of impressive
  performance

Cement A play on infrastructure
growth Increased Construction will lead to higher
cement demand
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The way forward

• Demand expected to grow by over 10, on a back of
  strong GDP growth (Cement
  historically has grown 1.2 times of GDP)
• New Supply is limited in next two years
• Demand to outstrip supply.
• Consolidation drive has changed the face of
  industry.

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Contents

• Indian Economy - A Promising Business Opportunity
• Cement Industry - At a glance
• Demand Drivers
• Ambuja Cement - An Overview
• Key Financials - Quarterly Results YTD
• Our Scorecard
• Share Price Performance
• Future Growth Plans

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Disclosure

• As the Accounting Year of the company has changed
  from June 30th to Dec 31st, the accounts for the
  current year are for a period of 18 months ending
  Dec 31, 2006.
• ACEL has been merged with Gujarat Ambuja Cements
  Ltd. w.e.f. Jan 1, 2006.
• For better comparison purpose, we have restated
  the figures for the relevant period including
  ACEL.

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Our Operations
Substantial Presence in West
North India
Cement Plant Grinding Station Terminal Port
Mn. Tonnes
9
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Ambuja Cement

• Capacity built up from 0.7 mn. Tonnes in 1986 to
  16.0 mn. Tonnes today.
• Sea transportation of bulk cement from Gujarat to
  3 terminal ports at Surat, Mumbai Sri Lanka.
• A captive port at Muldwarka (Gujarat) for inward
  / outward movement of goods.

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Our Strategy

• Captive Infrastructure Ports Power Plants
• Presence in the growing markets of North West
• Retail Focus Premium pricing
• Largest Exporter of cement
• 21 Cement transport by sea - Cheapest Mode
• One of the Lowest Cost Cement Producer

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Own Infrastructure

• 7 Owned Cement Ships for transporting Cement by
  Sea.
• Port at Muldwarka (Gujarat) to handle
  import/export of material.
• 3 Cement receiving terminals.
• Over 230 MW of Captive Power Plants at various
  cement plants to give reliable and cheap power.

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Strong Brand

• India - A bagged market
• Individual home builder - key driver of demand

• Our focus
• Best quality cement
• Good packaging
• Logistic management - strong distribution network
  
• Customer service

• Ambuja Cement - A preferred brand
• - Fetching higher
  realisation

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Contents

• Indian Economy - A Promising Business Opportunity
• Cement Industry - At a glance
• Demand Drivers
• Ambuja Cement - An Overview
• Key Financials - Quarterly Results YTD
• Our Scorecard
• Share Price Performance
• Future Growth Plans

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Financial Results - Latest Quarter
Rs. Crores
Rs. Crores
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Peers Quarterly Performance
Rs. Crores
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Financial Results Full Year 2006
Rs. Crores
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Borrowings (As On 31.12.2006)
Rs. Crores
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Contents

• Indian Economy - A Promising Business Opportunity
• Cement Industry - At a glance
• Demand Drivers
• Ambuja Cement - An Overview
• Key Financials - Quarterly Results YTD
• Our Scorecard
• Share Price Performance
• Future Growth Plans

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Our Scorecard 1986 - 2006
Market Capitalization 1986 4.53 Million
As of 1/2/2007 4.8 Billion
1100 times in 20 years
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Contents

• Indian Economy - A Promising Business Opportunity
• Cement Industry - At a glance
• Demand Drivers
• Ambuja Cement - An Overview
• Key Financials - Quarterly Results YTD
• Our Scorecard
• Share Price Performance
• Future Growth Plans

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Share Price Performance
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Contents

• Indian Economy - A Promising Business Opportunity
• Cement Industry - At a glance
• Demand Drivers
• Ambuja Cement - An Overview
• Key Financials - Quarterly Results YTD
• Our Scorecard
• Share Price Performance
• Future Growth Plans

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Ambuja Cement 2009Capacity to increase from 16
mn. Tonnes to 22 mn. tonnes

• New Projects
• Eastern Region
• 2.2 mn. tonne clinkerisation plant at Bhatapara
  in Chhattisgarh (Q12009)
• Northern Region
• 1.8 mn. tonne clinkerisation plant in Himachal
  Pradesh with 2 grinding stations aggregating to
  3.0 mn. tonnes. (Q2 2009)
• Power Plants
• 178 MW at different locations.

Rauri
Panipat
Dadri
Bhatapara
mn. tonnes
Total Outlay of Rs. 3500 Crores
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Our Shareholders
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Synopsis

• Cement....
• A Growth Story
• A Play on Indian Realty Infrastructure

Ambuja the Most Profitable Cement Play With
Growth and Value
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Thank you
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