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Diversif ied New Port folio. On the growth Highway
June 2007
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Table of contents
The Tat a Group - overv iew
Tat a Chem ical s - Business overview
Chemicals, incl uding overvi ew of Brunner Mond
Fert i l isers
The Road Ahead The Fut ure Tat a Chem ical s
Financial overview
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An overview of the Tata Group
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The Tata Group (Founded 1868)
Market cap: US$51.4bn1 Revenues: US$22bn2 PAT: US$2 billion2
India s largest and most respected business group
8%
8%
24%
24%
5%
9%22%
Metals
Composites
Hotels
Financial Services
International Trade
Beverages
Watches Retailing
Automobiles
Engg. Products
Engg.Services
Basic Chemicals
Fertilizer
Pesticides
Power
Fuel & Feedstock
ServicesServices
MaterialsMaterialsEnergyEnergy
ChemicalsChemicals
EngineeringEngineering
Consumer ProductsConsumer Products
Software Telecom Services
Automation &Control Systems
IT & CommunicationsIT & Communications
Notes: 1 Market cap (approx.) as on March 31, 2006 2 F.Y. 2006 data
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The Tata Group
96 companiesOperat ions in 40 count r ies
across all six cont inent s
Markets across 140 nat ions Revenues equivalent t o 3%of India s GDP
Over 246,000 employeesSt rong presence in al l
maj or business sect ors
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Tata Chemicals
Business Overview
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3rd largest soda ash
manufact urer in t he wor ld
#1 soda ash
player in India
Market leader in
edible salt market
Most energy ef f icient urea
manufact urer in India
1/ 3rd st ake in IMACID,
Morocco (one of t he largest
Phosphor ic acid manufact urers)
Presence in al l t hree
Agr i input cat egor ies
Tata Chemicals today is the>>Tata Chemicals today is the>>
Mit hapur Salt panMit hapur Salt pan
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Global Presence
MoroccoMorocco
UKUK
IndiaIndia
KenyaKenya
Net her landsNet her lands
Facilities
Markets
Sout h Af r icaSout h Af r ica
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Listing: Stock Exchange, Mumbai (BSE) andNational Stock Exchange (NSE)
Ticker: TTCH IN
Founded: 1939
Market Capit alizat ion US$ 1363 mn
Revenue3 (US$mm): 1337 (Chem icals 725, Fert i l i sers 612)
EBITDA3 (US$mm): 232
EBITDA Margin3: 17.3%
Employees: 3,500
Ownership: Sponsor Group 31.6 %Inst i t ut ional Invest ors 33. 8 %Indian Publ ic 34. 6 %
Note:
1: INR/USD Conversion rate of 43.47 as on 31 st March 2007 for all fi nancial data
2: INR/USD Conversion rate for Market capitalisat ion i s 40.40 as on 29th May 2007
At a Glance
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Fertilisers
46%
Chemicals
54%
Revenue Split
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Sodium CarbonateSoda Ash s most important use is in
the chemical make-up of glass.
When heated at high t emperatures,
combined with sand and calcium
carbonate and cooled very rapidly,
sodium carbonate can be used to
form the tr ansparent non-crystall ine
material, commonly known as glass.
Glass is used in the construction
indust ry as wel l as in mobile phones,
consumer electronics and beverages.
Soda ash is also used to make
detergents.
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Int ernat ional Market s Indian Market s
Soda ash indust ry perspect ive
Source: British Sulphur Consultants
Global demand at 37 mi l l ion MT,
China - 21% of demand;t o grow at 4% pa led by glass
Synt het ic product ion
dominat es 73%
Increasing natural gas, coal,
coke pr ices & f reight rat es
Sel l ing pr ices increasing af t er
seven years of weak pr ices
Domest ic demand 2.2
mi l l ion MT growing at 4-5%
Demand dr iven pr imar i ly
by t he f loat glass segment
Synt het ic soda ash accounts
for 100% of domest ic product ion
Capaci t y ut i li sat ion
levels at all -t ime high
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Soda ash India - Mithapur
Soda ash m anufact ur i ng Faci l i t y at Mit hapur, Guj arat
Exist ing Capacit y of 875,000 t pa
Produces equal volumes of light and dense soda ash Plant is in t he process of being m orderni sed
Plant also produces 500, 000 t pa of Cem ent and 50,000 t pa of Sodium
Bicarbonate
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Soda ash Price Chart
Ten Year Price perspective
Soda Ash Dense
6,000
7,000
8,000
9,000
10,000
11,000
12,000
1999
2000
2001
2002
2003
2004
2005
2006
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Overview of the Brunner Mond Group
The Brunner Mond Group
is a whol ly owned subsidiary
of Tata Chemicals acquired in
December 2005 f or Rs. 801 crore.
BMGL works with 1500 customers
and is Europe s second largest
producer of soda ash with plants in
England, Holland and Kenya. This
acquisition made Tata Chemicals
the worlds third largest soda ash
manufacturer with facilitiesspanning three continents.
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Europe 1.3mn t onsEurope 1.3mn tons Af r ica 0.715mn t onsAf r ica 0.715mn t ons
UK Netherlands
Magadi, Kenya
Terminal at
South Africa
Soda ash capacity
2.0 mn tons
Soda ash capacity
2.0 mn tons
Facilit ies within reach of maj or markets >>
Facilities and transportation terminal strategically located to give
access to major market s in Europe, Middle East , and South East Asia
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Lake Magadi has one of the largest soda ash reserves ofthe East Afr ican Rift Valley Lakes Close to key growth markets like Middle East and Asia
The capacity is being doubled to ~700,000 tpa
Durat ion - Lease valid for 30 years up to 2053
Area 227,000 acres Close to 15% of Indias soda ash impor ts are f rom Magadi -
Acquisit ion st rengthens Tata Chemicals India presence
Magadi Soda Ash A perspective >>
Lake Magadi, Kenya
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The Benefits of Natural Soda Ash
Lake Magadi, Kenya
Magadi i s t he second l argest Nat ural Soda Ash pr oducer in t hewor ld
The soda ash is obt ained by w ashing and calcini ng Trona, (anat ural ly occurr ing form of sodium sesquicarbonat e), ext ract edf rom Lake Magadi
Cost of product ion of nat ural soda ash is about half t hat ofsynt het ic soda ash
Magadi has a sel f - replenishing proven t rona reserve wit h a l i f eof 100 years
The use of t rona m akes Magadi Soda Ash t he l ow est costsoda ash producer in t he w orl d
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MIDDLE EAST
& AFRICA
Oman
UAE
Kenya
Sout h Af r icaNigeria
Saudi Arabia
Morocco
ASIA
India
Bangladesh
Sri Lanka
IndonesiaThailand
Pakist an
Philippines
VietnamMalaysia
EUROPE
UK
Net her lands
Germany
FranceBelgium
Sweden
Ireland
Norway
Denmark
Tata ChemicalsTata ChemicalsSoda ash markets >>Soda ash markets >>
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Maj or Brands we work with >>
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Superbrand - Ranked # 1 f ood brand by Economic Times
High brand equi t y and premium percept ion
Tat a Salt - pioneer in branded salt market
Nat ionwide dist r ibut ion - over 40 mi l li on consumers
Integrat ed operat ions at Chemical si t e - Embedded compet i t ive advant age
Business wi t h social obj ect ive f i rst Iodized Salt (goit re), now Fort i f ied (ir on
deficiency)
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Leading pl ayer i n urea and phosphat ic f ert i l iser segm ent s
Two pl ant s at Babrala near Delhi and Haldia near Kolkat amanufacturing Urea and Phosphates respectively
The Babral a plant has capacit y of 864,000 t pa and is bei ngdebot t lenecked and expanded by 33%
The Hald ia plant has a f er t i l iser product ion capaci t y of 750, 000 t paand w as acquired f rom Hindust an Lever i n 2003
Dual f eedst ock Babrala faci l i t y - most ef f ic ient in India w i t h energyconsumpt ion levels of 5. 17 Gcal/ t on; RIL s gas f inds t o furt her reducecosts of energy
St rat egic st ake i n IMACID, Morocco ensures cont inuous avail abil i t y ofphosphor ic acid
Tata Chemicals Fert il iser business
India is the third largest producer and consumer of Fert il isers
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Market Share in Core Command areas
Urea: 16%
DAP: 47%
NPK: 59% Presence in high consumption north and east regions
especially Punjab, Haryana and the Ganget ic belt of Ut tarPradesh, Bihar, and Bengal
Considerable share of high value fer t i li sers of Zinc
YOY Revenue Growth of 15% for 9MFY07
Operat ing growth of 7% to 32 crore for the same period
Tata Chemicals Fertiliser business
Dominant Market Share in Core Command Area poised to take advantageof (inevitable) liberalisat ion of policy
Baroda
(Nikohead office)
INDIA
Baroda
(Nikohead office)
INDIA
Punjab Haryana
Uttar Pradesh
W. Bengal
Jharkhand
Bihar
Baroda
(Nikohead office)
INDIA
Baroda
(Nikohead office)
INDIA
Punjab Haryana
Uttar Pradesh
Jharkhand
Bihar
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Soil Testing
Crop Loans
Farm Machines
Out put Purchase
Insurance of
input invest m ent
Advi sory Ser vices
TATA KISANTATA KISAN
SANSARSANSAR
Tata Kisan Sansar - Offer ings
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Tata Kisan Sansar (TKS) - creat ing rural
entrepreneurship
Provide value add services (Soil Testing & Farm Management)
Create a new dist r ibut ion channel for agricult ural inputs
Improve supply chain efficiencies and provide farm-gatelinkages to the market NCDEX
Create market driven R&D solut ions
Retail ing of f resh agricultural produce t ie up with TOTALProduce, Europe s largest fresh produce Company
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IMACID Plant entrance (above)and Plant overview (r ight ).
Tata Chemicals bought 33%
stake in IMACID (Indo Maroc
Phosphore) in 2005 to
securi t ise inputs for complex
fert iliser manufacturing
at it s Haldia plant
The Moroccan
Footprint
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The Fresh Produce Business
Leveraging the TKS Network
Focusing on what mat ters the supply chain Partnering with TOTAL PRODUCE 100 years of expertise
Sequent ial roll-out Punj ab and West Bengal
In 2007-08 2 Dist r ibut ion Centres
In 3 years 20 Dist r ibut ion Centres
In 5 years 40 Dist r ibut ion Centres
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1. Proposed ent ry into both Bio Diesel and Bio Ethanol
2. Trial cult ivat ion of non-food agr icult ural feedstockcommenced in both cases
3. Dual approach conventional technology & advanced
new t echnologies (concurrent development )
4. Development of novel t echnologies is the
responsibil it y of the Innovat ion Centre (Pune)
The Bio-fuels Business
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1. Based in Pune
2. Focus on the Bio-Nano space
3. 20 scientists going to 150 in 2 years t ime & ~500 in thelonger-term
4. Current Focus Areas: Bio Diesel cleaner & simpler t rans - esteri f icat ion
Bio Ethanol Enzyamatic Cellulosic conversions
Nano Materials, Bio Materials & Advanced/SmartMaterials
5. 25-30% Research into Blue Sky areas
The Innovat ion Centre
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FINANCIALFINANCIAL
OVERVIEWOVERVIEW
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Financials Revenue growth
554
317
918795
670
115
419
0
300
600
900
1,200
1,500
FY03 FY04 FY05 FY06 FY07
inU
SD
million 910*
* Post consoli dat ion
Note: FY2006 Consolidated financials include BMGLs Q4 results and IMACIDs performance over 11 mont hs
1337*
CAGR43%
CAGR43
%
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Financials EBIDTA
115
131
158
86100
74
35
0
50
100
150
200
250
FY03 FY04 FY05 FY06 FY07
inUSD
million 166*
* Post consolidation
CAGR2
8%
CAGR2
8%232*
* Post consolidation
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Profit After Tax
1776
80102
4148
20
0
20
40
60
80
100
120
140
FY03 FY04 FY05 FY06 FY07
inUSD
million
97*
Post consolidation
BMGL st af f cost s are net of wr i t e back of USD 7 mil li on of pension liabil i t ies in an overseas subsidiar y,consequent t o act uarial valuat ion. According t o Indian GAAP t his amount has t o be included in theP&L. Prof i t s in FY2006 are hence higher by same amount .
CAGR3
1%
CAGR3
1%
122*
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Financial snapshot
1 After reducing provision of USD 58.7 mn for the deficit in BMGs pension liability)
0.54
117
169
232
1337
Consolidated
20
45
74
442
IMACID / BMGL
0.48
102
123
158
918
TCL
FY 2007FY 2006
971680Net Income
0.450.37EPS
24
34
137
IMACID / BMGL(Jan to Mar 06)
147122EBIT
170134EBITDA
912795Sales
ConsolidatedTCL
** Exchange rate of $1=Rs.43.47 as on 31st March 2007
** Exchange rate of $1=Rs.44.25 as on 31st March 2006
FY 2007 D bt S lit
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Debt-Equity Perspective
412 429
502592
0
200
400
600
800
1000
1200
FY 2006 FY 2007
USD
million
Tot al Debt Shar eholder 's Equit y
1.41.3
0.8
2.0
5.9
0
1
2
3
4
5
6
FY 03 FY 04 FY 05 FY 06 FY 07
(%)
Reducing interest cost
(% of sales)
1021
914
FY 2007 Debt Split
19%
36% 44%
1%
FCCB Banks/ Ot hers
Term Loans Cash/ Packing Credi t
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Credit Ratios
10.1
3.9 7.4
12.9
19.4 0.6
0.2
0.3
0.7
0.4
0
5
10
15
20
25
FY03 FY04 FY05 FY06 FY07
-
0.1
0.2
0.3
0.4
0.5
0.6
0.7
0.8
Int erest Coverage rat io Net Debt /Equit y
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Financial rat ios
* Post consolidation
3248.4859No. of DaysCash cycle
4761.5964No. of DaysAvg Invent ory
Turnover
5352.7849No. of DaysAvg Debtors Veloc i ty
2.32.161.9TimesFixed Asset Turnover
Act iv i ty
10.112.9019.4TimesInterest Coverage
0.70.80.7TimesDebt : Equi t yStabi l i ty
232170115USD MillionEBITDACash Generation
2.0121.5TimesMarket to Book Value
3.63.55%Dividend Yield
11110393INRNetw or th per Share23.6219.915.8INREarn ings per share
ShareholderReturns
91111%Net Prof i t Margin
171917%EBITDA MarginPro f i tab i l i ty
FY 2007*FY 2006*FY 2005UnitCategory
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Shareholder Returns23.6
7.0
10.910.3
19.9
15.8
8.0
5.0
6.55.5 5.5
7.0
224
40
55
103
201
138
0
4
8
12
16
20
24
FY '02 FY '03 FY '04 FY '05 FY '06 FY '07
Rs.
pershar
e
20
40
60
80
100
120
140160
180
200
220
240
Rs
EPS Div idend Aver age Mar ket Pr ice
Consi st ent and heal t hy di vidend payout
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Shareholder ReturnsDividend amount per share per year
5.00
6.00
7.00
8.00
FY03 FY04 FY05 FY06 FY07
Rupees
454947
6157
4%
10%
5%5%
3%
0
10
20
30
40
50
60
70
FY03 FY04 FY05 FY06 FY07
%
0%
2%
4%
6%
8%
10%
12%
Div idend Payout Di v i dend Yield
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Shareholder Returns
41 50
78
96
117
0.45
0.36
0.230.23
0.54
-
20
40
60
80
100
120
140
FY03 FY04 FY05 FY06 FY07
USDMn
-
0.20
0.40
0.60
0.80
USD
PAT Basi c EPS
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Cash and Investments
Cash and Bank Balance
-
40
80
120
160
200
FY03 FY04 FY05 FY06 FY07
USD
Mn
Cash and Bank
Total value of quoted investmentsas on March 31, 2007:
USD 300 million
Investment in Mutual Funds
as on March 31, 2007:USD 97 million
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Acquired Hind Lever Chemicals,
extended presence across all agrinutrients
Bought 33% stake in IMACID andsecurit ised key inputs
Acquired Brunner Mond Group of UKfor 801 crore became 3rd largestproducer of soda ash in the world
In FY07
Achieved highest sales ever across allkey products - soda ash, salt and urea
Capacity utilisation levels at all timehigh
Babrala facili ty most energy eff icient inIndia, amongst the best globally
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Completion of expansion to double
low cost natural soda ash facil it y atMagadi
Debottlenecking and expansion ofBabrala Urea plant
Enhance Soda ash, cement & Saltcapacit ies at Mithapur
Further enhance exist ing capacit yut ilisat ion levels and st rengthen
eff iciencies at all plants
Mordernisation of Mithapurchemicals plant
Build a global bicarbonate business Better processes to enable
production of saleable gypsum
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Increase t hrust in new business
segment s l ike f resh produce andbio-fuels
Enhance presence in bio and nanot echnology
St rong focus on research anddevelopment
Ident i f y viable acquisi t ionopportunities
Leverage t he considerablepot ent ial of t he agr icul t ural sect or
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THANK YOU
2007 Tat a Chem icals.