1 1 2 Snapshot Snapshot – FY 2006 FY 2006 Reduction in Interest Costs by 50% Reduction in Interest Costs by 50% - 3rd consecutive year 3rd consecutive year Record Salt Sales: 4,60,868 Tn Record Salt Sales: 4,60,868 Tn Record Soda ash production : 8,10,684 Tn Record Soda ash production : 8,10,684 Tn Record Cement Sales: 4,86,064 Tn Record Cement Sales: 4,86,064 Tn Tax Refunds in cash : CY Rs. 116 Crore Tax Refunds in cash : CY Rs. 116 Crore - 3 rd rd year in a row year in a row Acquisition of Brunner Mond Acquisition of Brunner Mond – Rs.801 crore investment Rs.801 crore investment Acquisition of 33% stake in IMACID S.A., Morocco for 166 crore Acquisition of 33% stake in IMACID S.A., Morocco for 166 crore
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Snapshot Snapshot –– FY 2006 FY 2006
Reduction in Interest Costs by 50% Reduction in Interest Costs by 50% -- 3rd consecutive year3rd consecutive year
Record Salt Sales: 4,60,868 TnRecord Salt Sales: 4,60,868 Tn
Record Soda ash production : 8,10,684 TnRecord Soda ash production : 8,10,684 Tn
Record Cement Sales: 4,86,064 TnRecord Cement Sales: 4,86,064 Tn
Tax Refunds in cash : CY Rs. 116 Crore Tax Refunds in cash : CY Rs. 116 Crore -- 33rdrd year in a rowyear in a row
Acquisition of Brunner Mond Acquisition of Brunner Mond –– Rs.801 crore investmentRs.801 crore investment
Acquisition of 33% stake in IMACID S.A., Morocco for 166 croreAcquisition of 33% stake in IMACID S.A., Morocco for 166 crore
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Tata Chemicals isTata Chemicals is……
•• The 3The 3rdrd largest soda ash manufacturer in the worldlargest soda ash manufacturer in the world
•• The #1 soda ash player in IndiaThe #1 soda ash player in India
•• A market leader in the Indian edible salt market A market leader in the Indian edible salt market
•• The largest STPP player in the countryThe largest STPP player in the country
•• The most energy efficient urea fertiliser manufacturer in India The most energy efficient urea fertiliser manufacturer in India and amongst the most efficient globallyand amongst the most efficient globally
•• A true partner of the farmer with a presence in all 3 agri A true partner of the farmer with a presence in all 3 agri inputs categories as well as an expanding number of Tata Kisan inputs categories as well as an expanding number of Tata Kisan SansarsSansars
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FY 2006 FY 2006 -- Global FootprintsGlobal Footprints
MoroccoMorocco
UKUK
IndiaIndiaKenyaKenya
NetherlandsNetherlands
Manufacturing locations
Markets
South Africa South Africa
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Working with leading brandsWorking with leading brands
Gujarat Glass
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Brunner Mond Brunner Mond —— a transformational a transformational acquisitionacquisition
In December 2005 Tata Chemicals acquired the Brunner Mond GroupIn December 2005 Tata Chemicals acquired the Brunner Mond Group for ~ Rs 801for ~ Rs 801crore; EV <1x 2004 salescrore; EV <1x 2004 salesBrunner Mond is the second largest producer of Soda Ash in EuropBrunner Mond is the second largest producer of Soda Ash in Europe and the fifth e and the fifth largest in the world with ~1500 customers largest in the world with ~1500 customers
Flexibility in catering to markets across the globe from manufacFlexibility in catering to markets across the globe from manufacturing facilities in turing facilities in 3 continents 3 continents -- Europe, Africa and AsiaEurope, Africa and Asia
Deeper relations with large global customers like Unilever, P&G,Deeper relations with large global customers like Unilever, P&G,Pilkington, Asahi and St. Pilkington, Asahi and St. GobainGobain
A presence in the low cost natural soda ash segmentA presence in the low cost natural soda ash segmentaccess to larger Asian and European markets access to larger Asian and European markets
Capacity expansion to increase supply of dense ash to1.5 millionCapacity expansion to increase supply of dense ash to1.5 million tons globallytons globally
TCL combined turnover to go up ~40%TCL combined turnover to go up ~40%
Resultant synergies will enhance Tata Chemicals’ profitability
Chemicals BusinessChemicals BusinessAfter acquiring Brunner Mond, Tata Chemicals becomes the third After acquiring Brunner Mond, Tata Chemicals becomes the third largest Soda Ash & Bicarbonate producer in the worldlargest Soda Ash & Bicarbonate producer in the world
STPP prices showing a declining trendSTPP prices showing a declining trend
Cement sales boosted by robust growth in infrastructure and Cement sales boosted by robust growth in infrastructure and construction industryconstruction industry
The focus will now be onThe focus will now be on
Magadi expansion project to meet demands of a fast growing Magadi expansion project to meet demands of a fast growing glass industryglass industry
Integration exercise to focus on customer, markets, supply chainIntegration exercise to focus on customer, markets, supply chainand sourcing efficienciesand sourcing efficiencies
Soda Ash and Bicarbonate (value added & branded) businesses Soda Ash and Bicarbonate (value added & branded) businesses will now be operated on a global basiswill now be operated on a global basis
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Soda AshSoda Ash
•Demand from glass sector growing strongly•Dense ash manufacturing capacity enhanced to cater to it
•Plant modernisation programme enables improved capacity utilisation•Anthracite and other inputs drive down operating costs
•Globally tightness has been observed, although there is continued influence on prices & volumes due to Chinese exports
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Building a Global Building a Global Sodium Bicarbonate BusinessSodium Bicarbonate Business
Our existing businesses have little overlap, are not competing and have very different sector, market and pricing approaches
BM Business
• Global sales reach• Complex & extensive grade
portfolio• Low variable, high fixed costs• Pricing to add value to Soda
Ash • Sales balanced between direct
& via agents / distributors
TCL Business
• Strong domestic focus• Simple grade portfolio• Very low fixed costs• Pricing comparable with Soda
Ash• Sales predominantly via
distributors• Sales to consumer sector
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22%
50%
5% 4%
15%
Tata Salt Annapurna Captain Cook Aashirwad Nirma
Food additivesFood additives
Tata Salt retained the No. 1 position as the Most Trusted Food brand in India for the 3rd year in a row, as per the Brand Equity survey.
Tata Salt Branded Market share FY06
• Gross turnover growth of 18% due to better realisation on account of price hike
Increased thrust on salt exports – especially in Middle East
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•• ThreeThree--fold revenue growth in the past 3 years with the fold revenue growth in the past 3 years with the merger of HLCL and organic growth especially through merger of HLCL and organic growth especially through TKSTKS
•• Better Urea realization due to better market Better Urea realization due to better market understandingunderstanding
•• Better clarity in regulatory framework is emergingBetter clarity in regulatory framework is emerging
FertilisersFertilisers
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FertilisersFertilisers
Tata Chemicals remains the most energy efficient player in the Tata Chemicals remains the most energy efficient player in the industry with an energy consumption of 5.127 G Cal/ MT ureaindustry with an energy consumption of 5.127 G Cal/ MT urea
Production during FY 2006 was completed using natural gas and Production during FY 2006 was completed using natural gas and RLNG making it cheaper and more efficientRLNG making it cheaper and more efficient
TieTie--up with IMACID ensures constant supply of phosphoric acid up with IMACID ensures constant supply of phosphoric acid and continuity of operationand continuity of operation
Manufacturing several high value crop specific Manufacturing several high value crop specific fertilisersfertilisers (DAP (DAP ––NPKsNPKs mix) mix)
Number of TKS expanded to 450 and proposed expansion to 800Number of TKS expanded to 450 and proposed expansion to 800
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21%9%
9%
8%
3%4%
21%
25% Soda AshFood AdditivesUreaCementDAPNPKSTPPOthers
FY 2006 Revenue SplitFY 2006 Revenue Split
Details pertain to Tata Chemicals Standalone performance
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DebtDebt--Equity PerspectiveEquity Perspective
4.54.4
7.9
9.7
11.7
0
2
4
6
8
10
12
14
FY 02 FY 03 FY 04 FY 05 FY 06
(%)
Average interest cost reducing
1324 1454
19982168
0
500
1000
1500
2000
2500
3000
3500
4000
FY 2005 FY 2006
Total Debt Shareholder's Equity
FY 2006 Debt Split 2%9%
44%45%
FCCBShort Term LoansTerm LoansCash/ Packing Credit
3322 3622
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Financial ratiosFinancial ratios
ROACE
16.317.0
10.812.0
0.02.04.06.08.0
10.012.014.016.018.0
FY03 FY04 FY05 FY06(%
)
11.8
13.713.8
12.3
10.5
11
11.5
12
12.5
13
13.5
14
FY03 FY04 FY05 FY06
(%)
ROE
22
Credit RatiosCredit Ratios
3.9 7.4
56
19.4
0.20.3
0.5
(0.02)-10
0
10
20
30
40
50
60
FY03 FY04 FY05 FY06
Interest Coverage ratio Net Debt/Equity
12
23
Distribution of Earnings Distribution of Earnings –– FY 2006FY 2006
All consolidated financials include BMGL’s Q4 results and IMACID”s performance over 11 months
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Financials Financials –– EBIDTAEBIDTA
154
415
133
582
516460
0100200300400500600700800
2002 2003 2004 2005 2006
in R
s. C
rore
736*
* Post consolidation
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Profit After TaxProfit After Tax
197
127353
341
221
75
050
100150200250300350400
2002 2003 2004 2005 2006
in R
s. C
rore
428*
* Post consolidation
BMGL staff costs are net of write back of Rs.31.35 crore of pension liabilities in an overseas subsidiary, consequent to actuarial valuation. According to Indian GAAP this amount has to be included in the P&L. Profits are hence higher by Rs 31.5 crore
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Shareholder ReturnsShareholder Returns
7.0
10.9 10.3
19.915.8
5.06.5
5.55.5
7.0
4055
103
201
138
0
4
8
12
16
20
24
FY '02 FY '03 FY '04 FY '05 FY '06
Rs.
per
shar
e
20
40
60
80
100
120
140
160
180
200
220
240
Rs
EPS Dividend Average Market Price
Consistent and healthy dividend payoutConsistent and healthy dividend payout
*
* Post consolidation (Standalone EPS : Rs. 16.41)
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Share price performanceShare price performance
-
50
100
150
200
250
300
350
400
450
28-F
eb-0
3
18-A
pr-0
3
6-Ju
n-03
25-J
ul-0
3
12-S
ep-0
3
31-O
ct-0
3
19-D
ec-0
3
6-Fe
b-04
26-M
ar-0
4
14-M
ay-0
4
2-Ju
l-04
20-A
ug-0
4
8-O
ct-0
4
26-N
ov-0
4
14-J
an-0
5
4-M
ar-0
5
22-A
pr-0
5
10-J
un-0
5
29-J
ul-0
5
16-S
ep-0
5
4-N
ov-0
5
23-D
ec-0
5
10-F
eb-0
6
31-M
ar-0
6
(INR
)
Tata Chemical SENSEX
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The Road AheadThe Road Ahead
•• Doubling the Magadi FacilityDoubling the Magadi Facility
•• Modernisation of the Modernisation of the MithapurMithapurPlantPlant
-- Increasing Soda ash, cement & Increasing Soda ash, cement & Salt capacitiesSalt capacities
