KEC International Ltd. · NSE:KEC

KEC International — Investor Presentation (July 2011)

50 slides from KEC International's investor presentation, July 2011

1. Slide 1: KEC International Limited Corporate Presentation

   KEC IInternational t ti l Limited Li it d Corporate Presentation July 2011

2. Slide 2: Disclaimer

   Di l i Disclaimer This presentation may include statements which may constitute forward-looking statements. All statements that address expectations or projections about the future, including, but not limited to, statements about the strategy for growth, business development, market position, expend

3. Slide 3: Company Profile Business Overview Management Team

   Company Profile Business Overview Management Team Financial Performance

4. Slide 4: Company Profile

   Company Profile

5. Slide 5: RPG Group

   RPG Group RPG Group  Incorporated in 1979, one of India’s leading business conglomerates  Turnover - US$ 4.0 bn  Established across 8 business sectors  Over 16 companies  Over 40000 employees  Over 400,000 , shareholders Revenue Share as on March 31, 2011 Infrastructure,24.7% Power,23.7% Tyre,

6. Slide 6: KEC International - At a Glance

   KEC International - At a Glance  A diversified global Infrastructure EPC major ansmission  Leadership in Power Transmission EPC space.  Over 6 decades of experience.  Project j footprints p in over 45 countries across the g globe. Tra  A billion dollar turnover company Capabilities Design, test

7. Slide 7: KEC - Facts and Figures

   KEC - Facts and Figures  Annual Revenue (2010-11) – Rs. 4,474 crores (US$ 1.0 billion)  Order Book (2010-11 end) – Rs. 7,800 crores (US$ 1.7 billion)  Transmission is the largest business vertical contributing more than 70% of the company’s turnover.  More than 50% business comes from Internatio

8. Slide 8: Our value drivers

   Our value drivers Vision To be a global leader in Power Transmission and Distribution EPC business and a significant player in other infrastructure business, providing superior value to all stakeholders. C lt Cultural l Pillars Pill  Delivery Focus  Empowering Performance  Cost & Profitability Fo

9. Slide 9: Historical Milestones

   Historical Milestones First First tower First export iinternational t ti l Forays into supply order tower supply First 765 kV turnkey Railway SBU Water and for Bhakra export order transmission transmission Started Balance of Nangal from New project project in Plant Project, India. Zealand Sudan spac

10. Slide 10: Global Footprint

    Global Footprint EPC Projects Tower Supply KEC International Limited 10

11. Slide 11: KEC - Equity Share Information

    KEC - Equity Share Information Shareholding pattern as on June 30, 2011 Equity Share Information  Share Price (June 2011 end) - Rs. 79 per share  Market Cap (June 2011 end) – Rs. 2,030 Cr. (~$ 451 mn) Promoters, 42% Institutions, 43%  Price to Earning (P/E Ratio) – 9.9 times (Share price – June 2

12. Slide 12: Business Overview

    Business Overview

13. Slide 13: Business Areas (Overview)

    Business Areas (Overview) Power Transmission World leadership with more than 60 years of experience, capable of executing projects up to 800 kV Power Systems P Power systems t ranging i ffrom Substations, S b t ti Rural R l ElElectrification t ifi ti & BBalance l off Pl Plant. t Cables Manufactures

14. Slide 14: Power Transmission

    ORPG KEC c 2 V) 2 = O) Cc ge) — -—

15. Slide 15: Power Transmission

    Power Transmission  More than 60 years of experience in turnkey construction of transmission lines.  Strong presence in South Asia, Middle East, Africa, Central Asia and North America & Latin Americas.  Successfully executed turnkey transmission projects and supply of transmission towers in over

16. Slide 16: SAE Towers - A wholly owned subsidiary of KEC

    SAE Towers - A wholly owned subsidiary of KEC  SAE Towers headquartered in Houston, Texas is a 100% subsidiary of KEC from September 2010.  Leading manufacturer of lattice transmission towers in the Americas.  Annual production capacity – 100,000 MTs spread over 2 locations  Monterrey, Mexico (3

17. Slide 17: Projects in Diverse Terrain / Climatic Conditions

    Projects in Diverse Terrain / Climatic Conditions KEC International Limited 17

18. Slide 18: Projects in Diverse Terrain / Climatic Conditions

    Projects in Diverse Terrain / Climatic Conditions KEC International Limited 18

19. Slide 19: Tower Manufacturing

    Tower Manufacturing  Largest globally operated tower manufacturing company in the world.  Multi- locational plants o India - Nagpur (Maharashtra), Jabalpur (Madhya Pradesh) and Jaipur (Rajasthan) o Americas - Monterrey (Mexico) , Belo Horizonte (Brazil).  Manufacturing M f t i Capacity C it - 251

20. Slide 20: Design and Engineering Capabilities

    Design and Engineering Capabilities Design & Engineering  In-house design centers with a strong team of over 100 design experts spread in India and Americas.  Equipped with latest softwares like BOCAD, PLS Tower, PLS Pole, i Tower PLS CADD i-Tower, CADD, AUTOCAD AUTOCAD, MICROSTATION and Google Ea

21. Slide 21: Tower Testing Capabilities

    Tower Testing Capabilities  The only company in the world to have 4 tower testing stations, three in India and one in Brazil. o India - Nagpur (Maharashtra), Jabalpur (Madhya Pradesh) and Jaipur (Rajasthan) o Brazil: Betim (Belo Horizonte)  The Th NNagpur ffacility ilit is i the th highest-capacit

22. Slide 22: Power Systems

    Power Systems

23. Slide 23: Power Systems - Substation

    Power Systems - Substation  Designing and constructing substations – Executing various projects in India and Overseas  Entered into CIS region in substation segment by securing 1150 kV & 500 kV substations project in Kazakhstan. Total contract value is Rs. 926 crore in which KEC share is over Rs.

24. Slide 24: Power Systems – Rural Electrification, Balance of Plant

    Power Systems – Rural Electrification Electrification, Balance of Plant Rural Electrification  Successfully executed Rural Electrification projects in different parts of the world..  Presently executing Rural Electrification projects in India, Kenya, Ethiopia and Afghanistan  Electrified 10,000 v

25. Slide 25: Industry Outlook Power Transmission and Distribution

    Industry Outlook Power Transmission and Power Distribution (T&D) KEC International Limited 25

26. Slide 26: Industry Outlook – T&D

    Industry Outlook – T&D  The T&D industry expected to show strong demand globally driven by -  New power generation capacities  Increasing Private Sector Investments in the sector  Investments in interconnection grids/projects by various countries  Replacement of existing g aged g networks  Reg

27. Slide 27: Industry Outlook – T&D (Contd.)

    Industry Outlook – T&D (Contd (Contd..)) India (Power Transmission)  11th five year (2007-12) plan to add power generation capacity of ~51 GW against target of 78 GW.  In 12th five year plan (2012-17), government has planned capacity addition target of 100 GW.  The 11th five year plan had an expe

28. Slide 28: Industry Outlook – T&D (Contd.)

    Industry Outlook – T&D (Contd (Contd..)) United States –  The American Reinvestment and Recovery Act (ARRA) of 2009 is facilitating USD 11 Bn dedicated to the T&D grid in the USA  This is required for augmentation and strengthening of the transmission system, modernising the national electric grid

29. Slide 29: Industry Outlook – T&D (Contd.)

    Industry Outlook – T&D (Contd (Contd..)) Middle East -  The major demand driver in the region is upcoming large power generating plants including nuclear plants, plants development of inter-country/regional interconnection lines and increasing private investment.  Total estimated investment in the

30. Slide 30: Cables

    C bl Cables

31. Slide 31: Cables

    Cables Key Highlights  Fully integrated cable manufacturer with state-of-the-art manufacturing facilities in different parts of India.  Pioneered production of XLPE cables in India. India  Significant presence in manufacture of power cables, telecom cables and turnkey contracting.  The manufactu

32. Slide 32: Manufacturing Facilities - Cables

    Manufacturing Facilities - Cables High tension power cables  Installed capacity (Power Cables) : 1,200 KMs/annum  Leading manufacturer and pioneer in introducing XLPE cables in India. Thane Power cables & Telecom cables Installed capacity  Power cables: 10,000 KMs/annum  Jelly Filled cables & Op

33. Slide 33: Manufacturing Facilities - Cables

    Manufacturing Facilities - Cables  Putting up a State of the art, Greenfield facility at Samlaya, Vadodara (Gujarat-India)  Expected Commissioning – April 2012  Plant will be capable of manufacturing Power cables up to 400 kV  Plant will have a capacity of 3,000 cable kilometers per annum. Site

34. Slide 34: Telecom

    KEC RPG Telecom

35. Slide 35: Telecom

    Telecom Key Highlights  Amongst leading EPC players to provide telecom towers on turnkey basis to operators, tower management companies and utilities.  Experience in laying OFC and OPGW cables on turnkey basis and live line conditions.  Installation and commissioning of GSM/ CDMA equipment.  Exp

36. Slide 36: Railways

    R il Railways

37. Slide 37: Railways – Key Highlights

    Railways – Key Highlights  Complete turnkey solutions provider in the Railways Infrastructure EPC space. o Civil infrastructure including bridges, tunnels, platform, workshop modernization, building of station and facilities o Earthwork, new track laying and rehabilitation of existing tracks. o Rai

38. Slide 38: Railways – Industry Outlook in India

    Railways – Industry Outlook in India  The Annual Railway Budget of Government of India has proposed the highest ever plan outlay at ~Rs Rs. 576 bn ($ 13 bn) for 2011-12 on Indian Railways.  Key focus areas for investments includes electrification, capacity enhancements, addition of new lines, gaug

39. Slide 39: Water

    W t Water

40. Slide 40: Water – Key Highlights

    Water – Key Highlights  Skills and expertise at every phase of water and waste water management. o Irrigation and Hydroelectric construction o Embankment and Flood Control o Sewage and industrial effluent treatment o Potable water treatment and distribution  Current order book is ~Rs ~Rs. 78 crore

41. Slide 41: Water – Industry Outlook in India

    Water – Industry Outlook in India Current Scenario in India  India with 2.3% of the world world’s s total area has 16% of the world world’s s population; but only 4% of the total available fresh water.  Only 21% of the total Indian population has access to piped drinking water and 28% of Indian po

42. Slide 42: Management Team

    Management Team

43. Slide 43: Highly Experienced Team

    Highly Experienced Team  Meritorious Chartered Accountant with an Advanced Management Programme from Harvard Business School School.  39 years of varied experience across textile, edible oils & Engg. Industries & also geographies.  Vice President of IEEMA (Indian Electricals and Electronics Manuf

44. Slide 44: Highly Experienced Team

    Highly Experienced Team Luigi Ruggieri Randeep Narang Nikhil Gupta CEO, SAE Towers ED - South Asia ED - Cables  Engineer with over 35 years of  Commerce graduate and an MBA from  Meritorious Chartered Accountant and experience in Power industry, headed the NMIMS, Mumbai. 25 years of experience in

45. Slide 45: Financial Performance

    Financial Performance

46. Slide 46: Order Book – Robust & Diversified

    Order Book – Robust & Diversified Order Book - Business Segment Wise Order Book – Geography Wise Transmission, 73.8 % MENA,12.0% Power Systems, 18.7% Africa/Central Asia,20.0% Cables, 1.6% Americas, 20.9% (KEC 9.4%;SAE 11.4%) Railways, 5.0% South Asia, 46.6% Telecom & Waters, 0.9% Others,0.5% Order

47. Slide 47: Financials

    Financials Revenue Order Book 7800 4600 CAGR 21.7% 4474 8000 CAGR 26.1% 3907 3429 5500 3450 6000 5163 2814 4318 2300 2041 4000 3086 1150 2000 0 0 2006-07 2007-08 2008-09 2009-10 2010-11 2006-07 2007-08 2008-09 2009-10 2010-11 US$ Mn 469 702 676 870 1004 US$ Mn 710 1076 1018 1224 1749 EBITDA Margins

48. Slide 48: Financials

    Financials Rs. Crores 2010-11 Q4 2010-11* Particulars (12 months) (3 months) Turnover 4,474 1,557 YoY Growth 14.5% 14.8% EBITDA 465 164 % of turnover 10.4% 10.5% Interest 108 32 % of turnover 2.4% 2.1% Profit Before Taxes 317 120 % of turnover 7.1% 7.7% Profit After Taxes 206 79 % of turnover 4.6% 5

49. Slide 49: Summary

    Summary  Transforming into an E&C Conglomerate – Increasing presence in Substation, Railways, Waters  Leadership in Power Transmission EPC  Strong industry fundamentals  Robust Order Book  Diversified Geographical g p p presence  Financial performance – Consistent Growth; Impressive ROCE and R

50. Slide 50: Thank You

    THANK YOU Registered Office RPG House, 463, Dr. Annie Besant Road, Worli, Mumbai - 400 030. Phone: +91-22-6667 0200 Email: kecindia@kecrpg.com www.kecrpg.com

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