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Gujarat Ambuja Cements Limited

Gujarat 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

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Gujarat Ambuja Cements Limited

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  1. Gujarat Ambuja Cements Limited Wednesday, November 1, 2006

  2. 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

  3. Industry Highlights 1

  4. Cement Industry – At a Glance YOY Growth Cement Capacity 164.7 Mil.T.(As of Sep-06) 2.8% Clinker Production 118.4 Mil.T.(2006 Est.) 3.0% Cement Production 151.4 Mil.T. (2006 Est.) 10.8% Cement Demand (Domestic) 144.3 Mil.T.(2006 Est.) 10.1% 2

  5. Rising Capacity Utilisation 180 100 92.82 87.64 80.92 90 160 85.07 80.63 79.24 85.10 80 83.60 140 77.00 79.56 78.19 70 120 60 100 mn. tonnes 50 80 40 60 30 40 20 20 10 0 0 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 Capacity installed Cement Production Capacity utilisation (%) 3

  6. Industry Highlights (Jan – Sept 2006) 12% 12% 3% 2005 2006 113.55 113.24 88.79 101.39 101.20 85.44 Clinker Production Cement Production Cement Despatches * Growth rate 4

  7. Demand Drivers 5

  8. Demand Drivers • 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 Increased Construction will lead to higher cement demand 6

  9. The way forward • 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. Result – Prices to remain Firm 7

  10. Gujarat Ambuja Cements Limited – An Overview 8

  11. Our Operations (Post Merger with ACEL) Substantial Presence in West & North India HP Punjab Cement Plant Grinding Station Terminal Port Rajasthan Gujarat Chattisgarh WB Mn. Tonnes Maharashtra 9

  12. Gujarat Ambuja Cements Limited • 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. 10

  13. Our Strategy • 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 11

  14. 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 250 MW of Captive Power Plants at various cement plants to give reliable and cheap power. 12

  15. 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 13

  16. Key Financials(Standalone) 14

  17. Key Financials – Latest Quarter(July – Sept 2006) Rs. Crores 15

  18. GACL standalone (YTD) Rs. Crores 16

  19. Consolidated Results(YTD) 17

  20. Consolidated Results (YTD) Rs. Crores 18

  21. Sales Volume 19

  22. Sales Volume(Including ACEL) Mn. Tonnes 20

  23. Sales Realisation 21

  24. 250 200 150 100 Sep 05 Sep 06 Sales Realisation Rs. per 50 Kg Bag Jun-06 Mar-06 Dec-05 Sep-05 Sep-06 217 214 193 172 171 Mumbai 193 188 167 155 152 Ahmedabad 201 202 178 156 156 Delhi 178 174 162 144 138 Jaipur 194 192 178 171 172 Kolkatta 22

  25. Direct cost of Production 23

  26. Direct cost of Production 848 804 24

  27. Peers Quarterly Performance(July - Sept 2006) 25

  28. Peers Quarterly Performance (July – Sept 2006) 26

  29. Future Growth Plans 27

  30. Future Growth Plans Total Capital Outlay of Rs. 1600 Crores 28

  31. Status on the Merger of ACEL 29

  32. 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

  33. Our Shareholders ( Post Merger ) * Includes indirect holding of approx. 10% through Ambuja Cement India Private Limited 31

  34. Synopsis Cement… • A Growth Story • A Proxy on Indian Economy • A business with least challenges • Industry at Maturity Levels Ambuja the Most Profitable Cement Play With Growth and Value 32

  35. Thank You 33

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