Gujarat Ambuja Cements LimitedGujarat Ambuja Cements Limited

Wednesday, November 1, 2006

Contents Industry Highlights

Demand Drivers

Gujarat Ambuja Cements Limited – An Overview

Key Financials - Quarterly Results & YTD

Consolidated Results (YTD)

Sales Volume

Sales Realisation

Direct cost of Production

Peers Quarterly Performance

Future Growth Plans

Status on the merger of ACEL

Industry HighlightsIndustry Highlights

1

Cement Industry – At a GlanceCement Industry – At a Glance

Cement Capacity164.7 Mil.T. (As of Sep-06)

Clinker Production118.4 Mil.T. (2006 Est.)

Cement Production151.4 Mil.T. (2006 Est.)

YOY Growth

3.0%

10.1%

10.8%

2.8%

Cement Demand (Domestic)

144.3 Mil.T. (2006 Est.)

2

Rising Capacity Utilisation

3

79.56

79.2477.00

85.1085.07

78.19

80.6380.92

83.60

87.64 92.82

0

20

40

60

80

100

120

140

160

180

1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006

mn

. to

nn

es

0

10

20

30

40

50

60

70

80

90

100

Capacity installed Cement Production Capacity utilisation (%)

Industry Highlights (Jan – Sept 2006)

* Growth rate

3%

12%

4

2005 2006Clinker Production 85.44 88.79Cement Production 101.39 113.55Cement Despatches 101.20 113.24

Industry Highlights (mn. Tonnes)

101.

20

101.

39

85.4

4

113.

24

113.

55

88.7

9

Clinker Production Cement Production Cement Despatches

2005

2006

12%

Demand Drivers

5

Development of New Urban Cities

Hedge against Inflation - Property

Increasing Housing Mortgage Penetration

Retail Sector Development – Malls & Multiplexes

Growth in IT / IT Enabled Services

Emphasis on Infrastructure

Demand Drivers

Increased Construction will lead to

higher cement demand

6

Demand expected to grow by over 10%, on a back of

strong GDP growth

Fresh Supply is limited in the near future

Demand to outstrip supply.

Consolidation drive has changed the face of industry.

The way forward

Result – Prices to remain Firm

7

Gujarat Ambuja Cements Limited

– An Overview

8

HP

Gujarat

Rajasthan

Chattisgarh WB

Maharashtra

PunjabSubstantial Presence in West & North India

Cement Plant

Grinding Station

Terminal

Port

Clinker

Capacity

Cement

Capacity

Western India

Northern India

Eastern India

7.0

4.1

1.4

8.0

6.0

2.0

Total Capacity 12.5 16.0

Our Operations (Post Merger with ACEL)

9

Mn. Tonnes

Gujarat Ambuja Cements Limited

10

Capacity built up from 0.7 mn. Tonnes in 1986 to 16.0 mn. Tonnes today (including acquisitions).

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.

Captive Infrastructure: Ports & Power Plants

Presence in the growing markets of North & West

Retail Focus – Premium pricing

Largest Exporter of cement

35% Cement transport by sea - Cheapest Mode

One of the Lowest Cost Cement Producer

Our Strategy

11

7 Owned Cement Ships for transporting Cement by Sea.

Port at Muldwarka (Gujarat) to handle import/export of

material.

3 Cement receiving terminals.

Over 250 MW of Captive Power Plants at various

cement plants to give reliable and cheap power.

Own Infrastructure

12

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

Strong Brand

13

Key Financials

(Standalone)

14

Key Financials – Latest Quarter(July – Sept 2006)

2006 2005

Clinker Production (mn.t) 2.50 2.46

Cement Production (mn.t) 3.15 2.89

Sales volume (mn.t) 3.21 2.93

Sales value (Rs. Crores) 984.1 647.3

EBITDA (Rs. Crores) 381.4 171.6

PBT 323.0 101.0

PAT 244.7 75.3

EBITDA per ton (Rs.) 1188 586

EBITDA per ton (US$) 26 13

EBITDA Margin 39% 27%

GACL

Rs. Crores

15

GACL standalone (YTD)GACL standalone (YTD)

Mar-06 Jun-06 Sep-06 YTD

Clinker Production (mn.t) 2.76 2.73 2.50 7.99

Cement Production (mn.t) 3.65 3.85 3.15 10.65

Sales Volume (Mn. T) 3.65 3.77 3.21 10.63

Net Sales 924.3 1134.2 984.1 3042.6

EBITDA 339.3 451.9 381.4 1172.6

PBT 313.7 371.4 323.0 1008.1

PAT 298.6 303.9 244.7 847.1

EBITDA Margin 37% 40% 39% 39%

EBITDA per ton (Rs.) 930 1199 1188 1103

EBITDA per ton (US$) 20 26 26 24

Rs. Crores

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Consolidated Results

(YTD)

17

Consolidated Results (YTD)

Mar-06 Jun-06 Sep-06 YTD

Net Sales 945.8 1154.6 1006.2 3109.6

EBITDA 392.8 489.5 416.7 1299.0

Share of Associates 26.6 56.5 37.0 120.1

PBT 331.1 427.6 358.3 1117.0

PAT 315.8 360.1 280.0 955.9

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Rs. Crores

Sales Volume

19

Sales VolumeSales Volume(Including ACEL)(Including ACEL)

Mn. Tonnes

Plant wise Mar-06 Jun-06 Sep-06 YTD

Gujarat * 1.28 1.25 0.99 3.52

HP/Punjab 0.9 1.07 1.04 3.01

Maharashtra 0.89 0.88 0.64 2.41

Rajasthan 0.58 0.57 0.54 1.69

East 0.54 0.55 0.45 1.54

GACL + ACEL 4.19 4.32 3.66 12.17

% of Total Despatches 11 11 10 11

* Includes Exports

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Sales Realisation

21

Sales RealisationSales Realisation

22

Sep 05 Sep 06100

150

200

250

Rs.

per

50

Kg

Bag

Mumbai 217 214 193 172 171

Ahmedabad 193 188 167 155 152

Delhi 201 202 178 156 156

Jaipur 178 174 162 144 138

Kolkatta 194 192 178 171 172

Sep-06 Jun-06 Mar-06 Dec-05 Sep-05

Direct cost of Production

23

Direct cost of ProductionDirect cost of Production

0

200

400

600

800

1000R

s. p

er t

onne

of

cem

ent

Power 271 258

Coal 290 269

Raw Material 223 222

Consumables 64 55

July - Sep 2006 Apr - Jun 2006

848804

24

Peers Quarterly Performance

(July - Sept 2006)

25

Peers Quarterly Performance(July – Sept 2006)

Particulars ACC GACL* Grasim Ultra Tech

Sales Volume (mn.T) 4.27 3.66 3.38 3.68

Sales Value (Rs. Crore) 1391.6 1131.0 1141.2 1004.5

EBITDA (Rs. Crore) 391.2 425.6 356.0 266.4

EBITDA (US$ / Tonne) 20 25 23 16

EBITDA Margin 28% 38% 31% 27%

PBT (Rs. Crore) 315.8 359.3 N/A 187.9

PAT (Rs. Crore) 225.3 278.2 N/A 127.4

* Including full results of ACEL for better comparison

Grasim has other substantial businesses hence PBT & PAT not applicable.

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Future Growth PlansFuture Growth Plans

27

Future Growth PlansFuture Growth Plans

Projects Expected Year of completion

60 MW Power plant at Ambujanagar

Phase IPhase II

Expansion at Rabriyawas – 0.5mn. Tonnes clinker Grinding station at:

Farraka - 1 mn. Tonnes

Roorkie - 1 mn. Tonnes

2.3 mn. Tonnes clinkerisation plant at Chattisgarh Power plants of 81 MW at various locations

1st Quarter 2007

2nd Quarter 2007

June, 2007

January 2007

March 2007

December, 2008

December, 2008

Total Capital Outlay of Rs. 1600 Crores

28

Status on the Merger of ACEL

29

Status on the Merger of ACEL

Scheme of Arrangement filed with High Courts

Shareholder’s & Creditor’s meeting completed.

Process expected to be completed by end of

November 2006

30

Founder Promoters8%

Domestic Pension & Mutual Funds

17%GDR's

4%

FII's 32%

Retail Shareholding16% Holcim*

23%

* Includes indirect holding of approx. 10% through Ambuja Cement India Private Limited

Our Shareholders ( Post Merger )Our Shareholders ( Post Merger )

31

Cement…

A Growth Story

A Proxy on Indian Economy

A business with least challenges

Industry at Maturity Levels

Synopsis

Ambuja the Most Profitable Cement Play

With Growth and Value

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Thank You

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