#1murugappa Investor Presentation March 2016 Stock Codes: BSE: 504973 NSE: TUBEINVEST Bloomberg: TI IN /TI IB Reuters: TUBE.NS/TUBE.BO CIN: L35921TN1949PLC002905 Tube Investment of India Limited#2Contents 1. About Murugappa Group 2. Tube Investments of India Limited 3. Business Divisional Performance 4. Company Financials murugappȧ G -Disclaimer-- This presentation contains forward-looking statements which may be identified by their use of words like "plans," "expects," "will," "anticipates," "believes," "intends," "projects," "estimates" or other words of similar meaning. All statements that address expectations or projections about the future, including, but not limited to, statements about the strategy for growth, product development, market position, expenditures, and financial results, are forward-looking statements. Forward-looking statements are based on certain assumptions and expectations of future events. The companies referred to in this presentation cannot guarantee that these assumptions and expectations are accurate or will be realized. The actual results, performance or achievements, could thus differ materially from those projected in any such forward-looking statements. These companies assume no responsibility to publicly amend, modify or revise any forward looking statements, on the basis of any subsequent developments, information or events, or otherwise. 2#3Murugappa Group S INDIA Coromandel Chola MS GENERAL INSURANCE murugappa PARRYS WENDT CUMI Chola PARRY AGRO murugappȧ INR 269 Billion Conglomerate One of the largest family promoted, professionally managed, diversified business groups... G 3#4Murugappa Group-Spirit and Philosophy 1884-1949 The Spirit of the Murugappa Group Integrity Mr.A.M. Murugappa Chettiar Founder-Murugappa Group Responsibility murugappȧ Passion The five lights The waves inoples and beliefs that have always used as end continue to show the way forward. Respect Quality G Philosophy - "The fundamental principle of economic activity is that no man you transact with will lose; then you shall not." - Arthashastra 4#5Murugappa Group Today murugappa G FERTILISERS SUGAR TEA PESTICIDES ABRASIVES REFRACTORIES INDUSTRIAL CERAMICS CUTTING TOOLS BICYCLES CHAINS STEEL TUBES / STRIPS GEAR SYSTEMS ll METAL FORMING FINANCIAL SERVICES INSURANCE CONSTRUCTION WATER NUTRACEUTICALS PACKAGING POWER GENERATION HOME FURNISHINGS IT INFRA MANAGEMENT murugappa 5#6Murugappa Group -FY 2014-15 murugappȧ Gross Sales Share Company Name Market Capitalization CUMI 8% EID 10% Coromandel 42% CUMI 10% Others 3% TII 16% EBITDA Share EID 11% Others 3% ווז 14% CIFCO 14% Chola Coromandel Chola MS 7% T Chola MS 7% Coromandel 31% CIFCO 24% INDIA CUMI PARRYS • * 84,420 mn (US$ 1,349 mn) Description • Cholamandalam Investment and Finance Company Limited is a Non Banking Finance Company and one of the leading financial provider for vehicle finance, business finance, home equity loans, stock broking & distribution of financial products • Coromandel International Limited is the leading phosphatic fertilizer company in (US$ 1,249 mn) India, with a production capacity 3.2 mn tonnes of phosphatic fertilizers ⚫ 78,172 mn ■ * 68,431 mn (US$ 1,093 mn) • 35,420 mn (US$ 566 mn) *30,926 mn (US$ 494 mn) Chola ◆MS • Unlisted GENERAL INSURANCE PARRY AGRO ■ Tube Investments of India Limited offers wide range of engineering products such as, Steel tubes, chains, car door frames, etc. apart from e-scooters, fitness equipment and cycles ■ Carborundum Universal Limited is a pioneer in coated and bonded abrasives, super refractories, electro minerals and industrial ceramics. The Company currently has presence in Australia, South Africa, Russia, Canada and Middle East. EID Parry (India) Limited offers wide range of agro products such as sugar, microalgal health supplements and bio products, with a capacity to crush 34,750 tones of cane per day (TCD) th • Cholamandalam MS General Insurance Company Limited is a JV of Murugappa Group with Mitsui Sumitomo Insurance Group of Japan, (5 largest insurance group across the globe) Parry infra PARRY MMorgan ThermalCeramics INDIA KADAMANE COROMANDE ENGINEERING Ambadi sedis Shanthi Gears TII (Consolidated) represent 37% of Gross Sales and 42% of EBITDA of Murugappa Group of Worldwide 6#7Tube Investments of India Limited murugappa G 7#8TII-A Conglomerate TLCYCLES OF INDIA 1949 Set up TI Cycles (BSA & Hercules Brands) Chola MS Shanthi Bears Chola murugappa חד INDIA G ¿TSUBɅMEX 2012 Acquired Shanthi Gears 1960 Incorporated TIDC 1978 Promoted Financial Services 2001-Promoted General Insurance Co. 2014- Promoted TI Tsubamex, 1949 1955 1960 1965 1978 1985 2001 2010 2012 2014 PROBLCIS OF INDIA 1955 Incorporated Tube Products TUMETALFOM DIAMOND Racing Special 1965- Set up TI Metal Forming DEN LONG LIFE. HI-PERFORMANCE 1985 Indigenously manufactured 100 cc bike chain sedis 2010-Acquired Sedis, France 2014-Large Diameter Tube Plant 8#9Corporate Overview Manufacturing • Manufacturers of • Tubes, Strips, & Tubular Components • Bicycles & Fitness Products, • Chains for Automobile sector & Industrial applications, • Doorframe & Channels . Industrial Gears • Designing & Manufacturing of Dies murugappȧ Key Financials (Consolidated) Cr. 2014-15 2013-14 Growth Revenue 9,698 8,834 10% EBITDA 1,234 1,044 18% PBIT 1,112 914 22% Net Profit 424 311 36% • 23 Manufacturing Locations • ⚫ Suppliers to all major automotive OEM's in India • Focus on Quality & Operational excellence Financial Services • • Financing 534 branches across 25 states/Union Territories 90% presence across Tier II, Tier III & Tier IV towns General Insurance • 105 branches and over 9000 agents across the country. YTD YTD Cr. Growth Dec '15 * Dec '14 Revenue 6,280 7,330 -14% EBITDA 731 910 -20% PBIT 637 799 -20% Net Profit 313 277 13% *Revenue, EBITDA and PBIT of YTD Dec '15 includes CIFCL financials upto Aug '15 only as CIFCL ceased to be a subsidiary w.e.f. However, Net Profit 2nd September, 2015. includes entire 9 months Net Profit of CIFCL. 9#10Leadership Position- TII Standalone murugappȧ G Largest Supplier of precision tubes (CDW) One of the Largest bicycle producers in India Major player in automotive and industrial chains, Fine blanked components Preferred supplier for metal formed door frames 10 10#11Directors and Management Directors Mr. M. M. Murugappan Chairman murugappȧ G Mr. L. Ramkumar Managing Director Mr. N. Srinivasan Mr. S. Sandilya Mr. Pradeep V. Bhide Mr. C.K. Sharma Mr. Hemant Nerurkar Ms. Madhu Dubhashi Leadership Team Mr. Kalyan K Paul Mr. Arun Alagappan Mr. P. Ramachandran Mr. K. R. Srinivasan Mr. R. Narayanan Mr. R. Natarajan Mr. N. Presed 11#12Revenue and Profit Composition - FY 2014-15 murugappȧ TII Revenue - 9698 Crs. Mfg Revenue - 4217 Crs FS Revenue - 5481 Crs Gears 4% Metal 4,217, Form Cycles 31% 43% 28% 5,481, 57% Eng 37% Financial Services 68% Insurance 32% G PBIT 1112 Crs. 245, 22% Mfg Profit - 245 Crs Gears 5% Others -4% FS Profit-867 Crs 867, 78% Manufacturing Financial Services Cycles 22% Metal Form 31% Eng Financial Services 38% 77% Insurance 23% 12#13Financial Strength • Credit Rating ■ CRISIL AA for long term ■ CRISIL A1+ for short term ■ Standalone Balance Sheet ■ Total Debt / Equity - 1.09 ■ Long term Debt / Equity - 0.80 ■ Financial Services ■ Capital adequacy ratio - 20.10% (Stipulated limit - 15%) ■ General Insurance ■ Solvency ratio - 1.61 1.20 1.00 0.80 0.73 0.75 0.60 0.40 0.20 Total Debt/Equity 1.10 murugappa 1.10 1.08 1.09 G 0.00 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 YTD 13#14TII – Share Price and Shareholding Pattern Shareholding Pattern 100% 90% 26.2% 25.7% 25.8% 25.5% 25.5% 80% 70% 12.7% 12.2% 12.0% 12.1% 11.7% 60% 12.8% 13.2% 13.3% 13.6% 14.0% 50% 40% 30% 48.2% 48.9% 48.8% 48.8% 48.8% 20% 10% 0% Dec-14 Mar-15 Jun-15 Sep-15 Dec-15 500 450 400 350 300 250 200 150 100 50 31-Mar-09 01-Jul-09 01-Oct-09 01-Jan-10 ■Promoter FII DII Others Share Price Movement 01-Apr-10 01-Jul-10 01-Oct-10 01-Jan-11 01-Apr-11 01-Jul-11 01-Oct-11 01-Jan-12 01-Apr-12 01-Jul-12 01-Oct-12 01-Jan-13 01-Apr-13 01-Jul-13 01-Oct-13 Uninterrupted dividend history for 62 years Dividend payout policy ~25-30% of profits 01-Jan-14 01-Apr-14 01-Jul-14 01-Oct-14 01-Jan-15 01-Apr-15 01-Jul-15 01-Oct-15 01-Jan-16 14 427.60 murugappȧ G#15Cycles/Components murugop BSA TESTED TRUSTED & RESPECTED montra BSA SELECTED Superbrand HERCULES murugappȧ G You Tube www.youtube.com/sahercules www.facebook.com/bahercules BSA & Hercules bicycles are proud to be your chosen Superbrands. BSA BSA BSATDEUR BSA ON BSA LADYBIRD BSA MACH ROADSTERS ROADSTERS HERCULES www.bsahercules.com HERCULES DE ROADSTERS ROOSTERS RYDERS ODEO Pioneers in Selling Cycling... not just cycles 15#16Industry and Business Drivers Industry- FY15 Institutional Sales driving large volumes in the industry Growth in Fancy & Premium segments while Standards are in decline in Trade Business Drivers Large dealer network across India - over 10,000 touch points across India Expansive Retail Formats in Urban (BSA) ☐ Stores), Rural (RHB), Lifestyle (Track& Trail): around 660 stores Multi Locational Servicing Centers Continuous New product development Extensive BTL & ATL activities Focus on Exports State of the Art manufacturing facilities for Alloy and Carbon Capital Expenditure * 30 Cr. * 20 Cr. YTD Dec '15 2014-15 murugappȧ 100% 90% 80% 42% 50% 70% 60% 50% 40% 30% 58% 50% 20% 10% 0% Industry TII Standards Specials Market Share - YTD Dec '15 13% 33% 16% 38% G ATLAS AVON HERO TICI 16 Based on volumes of 4 Major players (Source: AICMA Data)#17Key Success Factors murugappa Brand equity Our flagship brands "BSA" and "HERCULES" were recognised for excellence at the World brand Congress in Singapore. THE Super / Mass Premium Lifestyle Cycles During the year, Super premium and Mass Premium MTB cycles had registered an overall growth of 95 % and 12% respectively. Pioneer in Retail Formats BSA Go, BSA Hercules Store, Track & Trial Lounge montra cannondale Bianchi Selling Cycling not Just Cycles Organised close to 1200 events all over the country participation of more than 2.2 Lakhs individuals SCHWINN GT BICYCLES Multi Location Servicing Large dealer and service network with more than 10,000 touch points through out the country mongoose BRIDLEY Pioneer in New Product Development 40 new Products developed during the year BSA HERCULES LADYBIRD ROADEO MACH CITY TRACK&TRAIL HIKING AND BEYOND montra 17#18Q3 Business Highlights Ladybird Vogue wins CII Design Excellence award BSA Lady Bird wins the Brand Revitalization Award at the Global Marketing Excellence Awards by CMO Asia Achieved 50% Growth Over Last Year in Super Premium Segment 5 Models Launched (Toonz 12, 14, TZ110, Rhino Shox and Lady Bird Bliss) ☐ Obtained additional Order from West Bengal Govt HERCULES New Urban adult segment "City Bike" a hit Marketing Events Organized Sales Melas, Service Camps, Mechanic trainings, College Sales & displays all over India Around 264 BTL activities conducted YTD Dec '15 SUPER TRAD STUDENTS 2017 RSA Fro MATZ him your murugappȧ LU DESIGN EXCELLENCE AWARDS 205 II LYCIES GIRLY MARKETING EXCEL NIE 18#19Key Financial Trends ROCE % murugappȧ figures in Crores Sales 120% 105% 100% 1400 1285 1307 1255 1179 84% 1114 1200 1056 80% 1000 62% 57% 60% 800 600 40% 34% 30% 400 20% 200 0 0% 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 YTD YTD ROCE is calculated based on end figures 19#20Key Financials - 2014-15 Particulars Volumes murugappa figures in Crores 2014-15 2013-14 % Growth Cycles (Lac nos) 40 38 6% Net Sales (incl. Inter Unit) EBITDA 1307 1179 11% 65 46 41% 5% 4% PBIT (Before Exceptional Item) 58 38 50% 4% 3% APPLICATION OF FUNDS Net Fixed Assets (Incl. CWIP) 59 46 Net Working Capital 111 16 Total Capital Employed 170 62 Sales/NWC ROCE% 11.7 74.8 34% 62% 20 20#21Key Financials - 2015-16 murugappa G figures in Crores Particulars Volumes 2015-16 Q3 2014-15 Q3 % Growth 2015-16 YTD 2014-15 YTD % Growth Cycles (Lac nos) 9 10 -11% 32 31 2% Net Sales (incl. Inter Unit) 285 317 -10% 1056 1018 4% EBITDA 11 14 -20% 65 50 29% 4% 4% 6% 5% PBIT (Before Exceptional Item) 9 12 -25% 59 45 31% 3% 4% 6% 4% APPLICATION OF FUNDS Net Fixed Assets (Incl. CWIP) 97 55 97 55 Net Working Capital 169 63 169 63 Total Capital Employed 266 119 266 119 Sales/NWC ROCE% 6.7 20.0 8.3 21.4 13% 40% 30% 50% 21 21#22Engineering murugappȧ Leader in CDW tubes for the Automotive industry 22#23Business Overview ☐ Industry Business Mix ■ Tubes: Significant Player in safety critical applications Non- ■ 2 wheelers: Leader in Front Forks in India Auto 22% ■ 4 wheelers: Leader in many critical applications such as side impact beam, steering columns etc. ■ CRSS: Niche player in specialized products ■ Tubular Components: Value added products Business Drivers ■ Manage High Variety demand in Tubes. and strips effectively High Focus on Value Addition Products ■ New Facility for Non-Auto Segment ■ Focus on internal efficiencies Auto 78% Capital Expenditure murugappȧ 24 Cr. YTD Dec '15 * 87 Cr. 2014-15 23#24Key Success Factors CDW Tube Market leader in High Quality & Safety critical CDW Tubes for 2W and 4W applications Multi Location Gearing for Non- Auto Plants at 4 different locations, well placed in all the regions Large-dia plant gave a significant foray into Non Auto segment CRSS Value Added Products Continued focus on special grades Tubular components including Steering column, side impact beam etc. SCAMFFLER FAS RVE murugappȧ Suppliers Conference 2013 TAKINVESTMENTS OF INDIA LIT (UNII: TUBE PUUDULIS KINDLAL BEST DELIVERY AWARD That me STAY.COMSCHA 24#25Q3 Business Highlights murugappȧ G Domestic Large Dia Volumes ramped up NPD % to Sales - 13% for Tubes and 11% for CRSS Exports Ramp up in TFF Export Volume New program for Drive line Tubing launched ZF Sachs, Italy placed Trial order for Value added TFF parts Operations ☐ Cost Competitiveness Program yielded good result Operational Excellence Initiatives done at all locations and reduced Customer rejections and In-plant rejections Recognition received from Customer Wipro for "Consistency in Improvements towards Quality" during their annual supplier quality meet. 25#26Key Financial Trends murugappa figures in Crores Sales ROCE % 35% 1800 1606 1600 1449 1467 1510 29% 29% 30% 1400 1190 25% 1140 22% 22% 1200 20% 1000 17% 14% 800 15% 600 10% 400 200 5% 0 0% 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 YTD YTD ROCE is calculated based on end figures 26 46#27Key Financials 2014-15 murugappa figures in Crores Particulars 2014-15 2013-14 % Growth Strips: (Volumes Tonnes) 56628 555 29 2% Domestic 55869 54986 2% Exports 759 544 40% Tubes: (Volumes Tonnes) 154088 145681 6% Domestic 143025 135967 5% Exports 11062 9714 14% Large Dia Tubes: (Volumes Tonnes) 856 Net Sales (incl. Inter Unit) 1606 1510 6% EBITDA 150 170 -12% 9% 11% PBIT (Before Exceptional Item) 103 136 -24% 6% 9% APPLICATION OF FUNDS Net Fixed Assets (Incl. CWIP) 465 416 Net Working Capital 154 193 Total Capital Employed 620 609 Sales/NWC ROCE% 10.4 7.8 17% 22% 27#28Key Financials 2015-16 murugappa figures in Crores Particulars 2015-16 Q3 2014-15 Q3 % Growth 2015-16 YTD 2014-15 YTD % Growth Strips: (Volumes Tonnes) 12804 13671 -6% 39002 44238 -12% Domestic 12700 13469 -6% 38682 43768 -12% Exports 104 202 -48% 320 470 -32% Tubes: (Volumes Tonnes) 37424 37170 1% 114686 117582 -2% Domestic 34947 34695 1% 107320 109441 -2% Exports 2477 2474 0% 7367 8141 -10% Large Dia Tubes: (Volumes Tonnes) 3115 123 9018 123 Net Sales (incl. Inter Unit) 373 389 -4% 1140 1229 -7% EBITDA 39 31 25% 111 112 -1% 10% 8% 10% 9% PBIT (Before Exceptional Item) 24 19 25% 67 79 -15% 6% 5% 6% 6% APPLICATION OF FUNDS Net Fixed Assets (Incl. CWIP) 446 463 446 463 Net Working Capital 188 203 188 203 Total Capital Employed 635 666 635 666 Sales/NWC ROCE% 7.9 7.7 8.1 8.1 15% 11% 14% 16% 28#29G Metal Formed Products murugappȧ PRECISION VALUE ADDED SHEET METAL FORMED COMPONENTS POWER TRANSMISSION CHAINS AND FINE BLANKED COMPONENTS Precision Value added Components 29 29#30Business Overview ■ Industry ■ Growth in 2W Scooters by 10%, but decline in motor cycles by 3% in YTD Dec '15 ■ Passenger car industry grew by 7% YTD Dec. '15 compared to same period last year and Commercial vehicle industry grown by 10% ■ Slow to moderate growth in Europe & US Railways: ICF increased the production of Stainless steel coaches ■ Business Drivers ■ Factories located closer to customer locations ■ Strong "DIAMOND" brand High quality products - Customer end rejections well below the customer targets ■ Leveraging Acquisitions - SEDIS Synergies ☐ ■ Increasing Portfolio for Fine Blanking ☐ ■ Expand applications for Industrial Segment 73% 13 Cr. Business Mix 7% 20% Capital Expenditure YTD Dec '15 murugappȧ ■ Railways ■ Non-Auto ■ Auto *26 Cr. 2014-15 30#31Key Success Factors Segment Leader Market leader in Drive chain and Cam chain in OEM segment Multi Location Strategically located plants near leading OEMs Brand Equity Strong brand equity - “Diamond and Rombo" brands Quality murugappa COMSTAR Excellent Program Support Ti Metal Forming 2012 DIAMOND ROMBO LONG LASTING CHAINS & KITS Customers Critical application PPM less than customer target Catering to major 2W OEMs and Tier 1 Auto customers; IC OEMs in Domestic & Exports; Large dealership network in Auto and IC Fine blanking, motor casings Hero TED TVS X HONDA ROYAL ENFIELD BOSCH Autoliv Representative list not exhaustive 31#32Q3 Business Highlights ■ Award received from Lear for "Excellence in Part Development" for seat recliner localization development ■ Market Leadership in Chains across segments ■ Improved Market Share in both Drive & Cam Chains. vis-à-vis same period last year Industrial Chains: Repeat Orders from international distributors and orders received in new segments ■ Expanding reach of Aftermarket Portfolio providing an impressive growth ■ Initiative: Free Special Service camps for Flood Affected vehicles in Chennai ■ New customers addition for Fine Blanked Components and seeing growth of new product sales in domestic Leadership position in Doorframe & Channels business murugappȧ "Excellence in part develop Ni "ACHIEVE ZERO DEFECTS QUALITY CAMPAIGN waragapoo 13 Activates within 100 day : 01.01.2008-1884-2016 188D PRISONMEN TE ARTUR STE I TOOLS FRODITE MPAMANTS WET.COME KDIAMOND FREE CHAIN SERVICE CAMP 32 32#33Key Financial Trends Sales ROCE % murugappa 7 figures in Crores 1000 860 875 900 795 799 769 800 700 600 30% 24% 672 25% 23% 20% 500 17% 17% 16% 14% 15% 400 300 10% 200 5% 100 0 0% 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 YTD 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 YTD ROCE is calculated based on end figures 33#34Key Financials 2014-15 Particulars Doorframes (Lakh Sets) figures in Crores 2014-15 2013-14 % Growth 7 8 -15% murugappȧ Sections for railway wagons (Sets) 1542 987 56% Coach-side/End wall (Sets) 43 16 169% Chains: Domestic (Lac ESS feet) 791 715 11% Exports (Lac ESS feet) 72 70 3% Net Sales (incl. Inter Unit) 875 799 10% EBITDA 116 99 18% 13% 12% PBIT (Before Exceptional Item) 81 67 21% 9% 8% APPLICATION OF FUNDS Net Fixed Assets (Incl. CWIP) 315 325 Investments 61 61 Net Working Capital 100 92 Total Capital Employed 477 478 Sales/NWC ROCE% 8.7 8.7 17% 14% G 34#35Key Financials 2015-16 murugappȧ figures in Crores 2015-16 2014-15 2015-16 2014-15 Particulars Q3 Q3 % Growth YTD YTD % Growth Doorframes (Lakh Sets) 2 2 3% 5 5 -8% Sections for railway wagons (Sets) 549 426 29% 831 902 -8% Coach-Side/End wall 28 12 133% 74 23 222% Chains: Domestic (Lac ESS feet) 215 199 8% 608 593 2% Exports (Lac ESS feet) 20 18 10% 55 53 4% Net Sales (incl. Inter Unit) 243 226 8% 672 651 3% EBITDA 33 29 13% 90 84 7% 13% 13% 13% 13% PBIT (Before Exceptional Item) 23 19 18% 61 56 9% 9% 9% 9% 9% APPLICATION OF FUNDS Net Fixed Assets (Incl. CWIP) 300 319 300 319 Investments 61 61 61 61 Net Working Capital 105 94 105 94 Total Capital Employed 466 474 466 474 Sales/NWC ROCE% 9.2 9.6 8.5 9.2 19% 16% 17% 16% 35#36Metal Formed Products (Contd.) murugappȧ EUROPE RUSSIA CANADA GEORGIA CHINA LEBANON SYRIA KOREA JAPAN ALGERIA GUADELOUPE MAROCCO MAURITANIA TUNISIA EGYPT ISRALL KUWAIT JORDAN QATAR RAN THAILAND PAKISTAN BANGLADESH INDIA MARTINIQUE FRENCH PURANA SENEGAL NIGERIA VEMEN BURKINA FASSO SUDAN UNITED EMRATES GUINEA CHAD - NĂM GENIN VENEZUELA COLOMBIA CAMEROUN VORY COAST SI LANKA MALAYSIA TOGO ECUADOR GABON KENYA CONGO BRAZIL PERU MAPOTTE TANZANIA REUNION ZIMBABWE MAUTITIUS SOUTH POLYNESA SINGAPORE INDONESIA MEXICO GUATEMALA BOLIVIA ARGENTINA CHILLI sedis AFRICA MADAGASCAR AUSTRALIA NEW CALEDONA NEW ZEALAND Leading French Manufacturer of Industrial Chains G 36#37Business Overview Sales Mix Y '14 murugappa . • FC 10 - Holding company of Sedis ■ Two plants in France ■ Five global patents ■Leader in special and engineering class chains Range of industries catered to ■ Waste Treatment / Car / escalator / textiles/food processing / packaging cement / sugar/ paper/water treatment / lumber / dams amusement park / Oil Platforms Leader in France Present in around 100 countries ■ Around 200 distributors ■ Around 400 sale points Rest of World, 3 3% France & Italy, 67 % Key Products Leaf & Roller Chains Conveyor Chains Agricultural Chains Sprockets & Wheels 37 32#38Key Financial Trends Sales 35000 33256 33265 30000 27882 25000 20000 32668 31800 16% 15% 14% 12% 24880 10% 9% 8% do do 6% ROCE % murugappa figures in K Euro 15000 4% 4% 10000 4% 3% 5000 2% 0% 0 0% 2010 2011 2012 2013 2014 2015 YTD 2010 2011 2012 2013 -2% 2014 2015 YTD ROCE is calculated based on end figures 38#39Key Financials - 2014 murugappȧ figures in K Euro Particulars 2014 2013 Net Sales 32668 31800 EBITDA 1193 1398 4% 4% PBT -380 229 -1% 1% PAT -26 348 0% 1% APPLICATION OF FUNDS Net Fixed Assets (Incl. CWIP) 6459 5693 Net Working Capital 6465 6437 Goodwill on Consolidation 721 866 Total Capital Employed 13646 12996 Sales/NWC 5.1 4.9 ROCE% 0% 4% G 39#40Key Financials - 2015 murugappȧ figures in K Euro 2014 YTD Particulars 2015 - Q3 2014 - Q3 2015 YTD Net Sales 7294 7715 24880 24785 EBITDA -44 116 1089 895 -1% 2% 4% 4% PBT -233 -160 -0.27 -221 -3% -2% 0% -1% PAT -193 -68 90 -44 -3% -1% 0% 0% APPLICATION OF FUNDS Net Fixed Assets (Incl. CWIP) 6541 6351 6541 6351 Net Working Capital 9337 6819 9337 6819 Goodwill on Consolidation 613 758 613 758 Total Capital Employed 16491 13928 16491 13928 Sales/NWC 3.1 4.5 3.6 4.8 ROCE% -3% -3% 3% 0% 40 40#41Gears & Gear Products murugappȧ Shanthi Gears (SGL) - Strong Brand in Industrial Gears G 41#42Business Overview Shareholding Pattern murugappa G 100% • Began operations in 1969 at Coimbatore 90% 24.5% 23.1% 22.9% 22.8% 22.7% 22.5% • Leader in custom-made gears & loose gears 80% 4.8% 3.5% 6.9% 7.0% 7.2% 7.4% 70% 1.8% 1.9% 0.1% 0.1% 0.0% 0.0% . ~70% of revenues come from customized products 60% Others 50% ■DII 40% FII 70.1% 70.1% 70.1% 70.1% 70.1% 70.1% 30% Promoter 20% • Fully integrated operations with in-house 10% 0% • R&D team Sep-14 Dec-14 Mar-15 Jun-15 Sep-15 Dec-15 • Design and engineering capabilities · Foundry, Fabrication and forging unit Key Products • Comprehensive Heat treatment facilities. • Tool room for manufacturing hobs, cutters • Gears & Pinions • Gear boxes •Geared motors • Gear assemblies •Worm Spares •Service & Repair 42 Til holds 70.12% stake in the company#43Business Highlights • • . • Increased enquiry activities from repeat customers and railways Focus continues on high contribution orders Focus on Capacity Enhancement and Cost Initiatives in place to renew business from old customers and business development for both domestic and exports New ELITE series of Helical Standard gearboxes E-Catalogue released, with optimal design for higher rating capacity and less weight murugappa G 43#44Key Financial Trends ROCE % murugappȧ figures in Crores Sales 20% 18% 200 18% 173 16% 162 16% 151 152 144 150 14% 122 12% 100 10% 10% 8% 8% 8% 50 6% 5% 4% 0 2% 0% 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 YTD YTD ROCE is calculated based on end figures 44#45Key Financials 2014-15 murugappa figures in Crores Particulars 2014-15 2013-14 % Growth Net Sales 152 151 1% EBITDA 18 42 -56% 12% 28% PBIT 13 26 -49% 9% 17% PBT G PAT 9 18 -49% 6% 12% APPLICATION OF FUNDS Net Fixed Assets (Incl. CWIP) 85 99 Investments 16 50 Net Working Capital 171 120 Total Capital Employed 272 269 Sales/NWC 0.9 1.3 ROCE% 5% 10% 45#46Key Financials 2015-16 murugappa figures in Crores 2015-16 2014-15 2015-16 2014-15 Particulars %Growth % Growth Q3 Q3 YTD YTD Net Sales 43 42 1% 122 113 7% EBITDA 8 6 26% 23 15 57% 19% 15% 19% 13% PBIT 6 5 23% 17 10 76% 15% 12% 14% 9% PBT 6 5 23% 17 10 76% 15% 12% 14% 9% PAT 5 4 37% 13 8 64% 12% 9% 11% 7% APPLICATION OF FUNDS Net Fixed Assets (Incl. CWIP) 75 89 75 89 Investments 64 25 64 25 Net Working Capital 144 161 144 161 Total Capital Employed 282 275 282 275 Sales/NWC 1.2 1.1 1.1 0.9 ROCE% 9% 7% 8% 5% 46#47Financial Services 36 years of Existence Enter a better life VEHICLE FINANCE HOME EQUITY LOANS CORPORATE FINANCE DISTRIBUTION& ADVISORY SERVICES SECURITIES Cholamandalam Investment and Finance Company Ltd. (CIFCL) Financing your Assets...since 1978 murugappȧ G 47#48Business Overview Shareholding Pattern Shareholding Pattern Institutions, 10.3% murugappa Public, 4.9% Established in 1978, one of India's leading NBFC's, focused in the rural and semi-urban sector with a market capitalization of INR 102 bn • Presence across vehicle finance, business finance, home equity loans, stock broking and distribution of financial products Operates from 534 branches across 25 states and 90% presence across Tier II, Tier III and IV towns One of the leading NBFCs in rural / semi urban areas FII, 31.7% Promoters share holding of 53.1% includes Tube Investments-46.28%, Ambadi Holdings Private Ltd-4.62% ⚫ Others -2.26% Disbursements - YTD Dec'15 3% 22% 75% Promoters, 53.1% ■ Vehicle Finance ■ Home Equity ■ Others T 48#49Business Strengths murugappȧ G Positioning Exceptional Lineage Robust Sector Growth Diversified Footprint Robust Operating Profile Founded in 1978, India's leading NBFC, Focused in Rural and semi urban sector with Market cap of INR 102 bn - Part of the INR 269 bn Murugappa Group – founded in 1900, one of India's leading business conglomerate • Presence across vehicle finance, business finance, home equity, loans, stock broking and distribution of financial products Operates across 534 branches in 25 states and 90% presence in Tier II, Tier III and IV towns Total AUM of INR 280 Bn. with healthy ROTA of 3.2% Management Highly experienced management team with unrivalled industry experience 49 49#50CIFCL - Standalone Performance murugappȧ Disbursements Profit after Tax ROTA (PBT) Book Value* EPS ROE* Q3-FY16 4260 Cr. 146 Cr. 3.6% * 227.6 *37.1 16.7 -3% 38% 31% 23% 14% 22% Q3-FY15 ₹3082 Cr. 111 Cr. 3.0% 198.8 * 30.4 17.2 Disbursements Profit after Tax ROTA (PBT) Book Value* EPS ROE* YTD 11439 Cr. 376 Cr. 3.2% €227.6 33.4 14.9 Dec 15 -8% 23% 26% 14% 14% 21% YTD Dec 14 9299 Cr. 300 Cr. 2.8% * 198.8 27.5 16.2 ^ EPS is annualised *ROE is calculated on Profit after Tax; drop is due to Capital Infusion 50 50#51Key Financial Trends murugappa figures in Crores Disbursements Total Income 13114 14000 12808 12118 4000 3715 11439 12000 3279 3500 10000 8888 3000 2568 8000 2500 5731 1779 2000 6000 1500 1206 4000 1000 2000 500 0 ili 3073 0 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2010-11 2011-12 2012-13 2013-14 2014-15 YTD 2015-16 YTD 3.5% 3.0% 2.5% 2.0% 1.4% 1.5% 1.0% 0.5% 0.0% ROTA (PBT) 3.2% 3.0% 3.0% 2.7% 2.8% 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 YTD 51#52Key Financials Particulars murugappȧ figures in Crores FY 2014-15 2013-14 % Growth 12808 13114 -2% G Disbursement Total Income from Operations 3715 3279 13% 29% 25% PBT 666 554 20% 5% 4% PAT 444 368 21% 3% 3% ROTA (PBT) 3% 3% Capital Adequacy Ratio 21% 17% 52 2#53Key Financials murugappȧ figures in Crores G Particulars 2015-16 Q3 2014-15 Q3 %Growth 2015-16 YTD 2014-15 YTD % Growth Disbursements 4260 3082 38% 11439 9299 23% Total Income from Operations 1060 970 9% 3073 2771 11% PBT 224 171 31% 581 462 26% 21% 18% 19% 17% PAT 148 113 31% 381 308 24% ROTA% (PBT) 3.6% 3.0% Capital Adequacy Ratio (%) 20.10 20.96 3.2% 2.8% 20.10 20.96 53#54Insurance G Chola MS GENERAL INSURANCE ACCELERATED GROWTH CONTINUOUS PROFITABILITY murugappȧ 54#55Business Overview • Among the fastest growing general insurance companies in India Share Holding 26% • 7th largest private general insurance company in India • Product basket comprises accident, engineering, health, liability, marine, mo tor, property, travel and rural insurance for individuals, SMEs and corporates 74% murugappȧ TII Mitsui Sumitomo Crore YTD Dec'15 FY14-15 • Leading insurer for Japanese / Korean business GWP interests in India 1706 1896 (inc RI Accept) PAT 92 137 55#56Business Strengths murugappȧ Strong Distribution Partners Robust Underwriting Capability and operating efficiencies Tailor Made Products Strong Chola Synergies High Rural Penetration State of the Art Technology G 56 99#57Business Highlights murugappȧ • GWP - growth of 23% over YTD Dec '15 • Motor and Fire Products show significant growth over PY • Significant growth in Partnership and Proprietary channels (30% and 35% over PY respectively) • The performance of Partnership and Government segments achieve targets above plan G 57 49#58Key Financials figures in Crores murugappȧ Particulars FY 2014-15 2013-14 % Growth GW Premium (incl. RI accept) 1896 1872 1% Net Written Premium 1482 1431 4% PBT 201 102 98% PAT 137 70 96% Total Investment 3165 2328 Combined ratio (CoR%) 104% 101% Investment Yield % 10.06% 9.30% G 58 5#59Key Financials murugappȧ G figures in Crores 2015-16 2014-15 % 2015-16 2014-15 % Particulars Q3 Q3 Growth YTD YTD Growth Gross Written Premium 614 407 51% 1706 1384 23% (Ind. RI Accept) Net Written Premium 539 361 49% 1426 1126 27% PBT 52 57 -8% 138 157 -12% PAT 34 39 -12% 92 107 -14% Total Investment 3724 3098 20% 3724 3098 20% Combined Ratio (CoR%) - 106% 103% 107% 102% Excl IMTPIP Investment Yield % 9.03% 9.54% 9.53% 9.64% 59#60Company Financials G murugappa 60 60#61Consolidated Performance Trends Total Income PBT murugappȧ figures in Crores 12000 10000 1200 9698 1003 8834 1000 7752 789 8000 800 6456 6280 674 6000 5068 536 533 600 4000 335 400 2000 200 0 0 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 YTD 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 YTD Dividend Per Share - In 3.50 3.00 3.00 3.00 2.50 2.00 1.50 1.50 1.00 0.50 2.00 2.00 25.00 20.00 15.00 1.50 10.58 10.00 5.00 Earnings Per Share (Basic)- In 16.67 15.47 14.46 22.69 16.74 0.00 0.00 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 YTD 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 YTD 61#62Standalone Performance Trends murugappa figures in Crores PBIT & PBIT % Sales 350 322 12% 307 4000 3646 300 10% 3464 255 264 259 10% 3390 3352 9% 3500 2963 250 2770 8% 8% 3000 8% 200 7% 186 7% 2500 6% 150 2000 4% 1500 100 1000 50 2% 500 0 0 0% 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 YTD 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 YTD ROCE% 18% 16% Earnings Per Share (Basic)- In ₹ 16% 16% 12.00 14% 9.69 10.00 9.16 12% 10% 10% 10% 9% 8.00 8% 8% 6.00 6.46 5.58 5.04 6% 4.00 3.14 4% 2.00 2% 0% 0.00 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 YTD 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 YTD ROCE is calculated based on end figures 62#63Standalone Performance Trends murugappȧ figures in Crores EBITDA PAT 400 367 345 200 180 350 319 170 298 301 300 257 150 250 104 200 100 121 94 94 150 59 100 50 50 0 0 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 YTD YTD 250 200 165 150 100 87 50 Capex 217 169 136 70 10 0 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 YTD 63#64Key Financials FY 2014-15 figures in Crores murugappa G Particulars Standalone Consolidated 2014-15 2013-14 2014-15 2013-14 Net Sales / Income from Operations 3646 3352 9160 8370 Growth % 9% -1% 9% 14% Total Income from Operations (Net) 3828 3526 9698 8834 Growth % 9% -1% 10% 14% EBITDA 319 301 1234 1044 % to Sales 9% 9% 13% 12% PBIT Before Exceptional Item 259 264 1112 914 % to Sales 7% 8% 12% 11% PBIT After Exceptional Item 293 264 1146 914 % to Sales 8% 8% 13% 11% Profit Before Tax 155 141 1003 789 % to Sales 4% 4% 11% 9% Profit After Tax (before Minority Interest) 121 94 684 518 % to Sales 3% 3% 7% 6% Net Profit 121 94 424 311 % to Sales 3% 3% 5% 4% 64#65Key Financials 2014-15 contd. Particulars EQUITY AND LIABILITIES Shareholders' Funds Standalone figures in Crores Consolidated 2014-15 2013-14 2014-15 2013-14 murugappȧ G (a) Share Capital (b) Reserves and Surplus 37 37 37 37 1283 1201 2290 1914 Minority Interest 0 1604 1364 Preference shares issued by a subsidiary outside the Group 0 500 Non-Current Liabilities (a) Long Term Borrowings 781 638 13196 10461 (b) Deferred Tax Liabilities (Net) 57 52 61 58 (c) Other Long Term Liabilities 0 0 1089 1258 (d) Long Term Provisions 0 0 325 306 838 690 14670 12083 Current Liabilities (a) Short Term Borrowings 340 303 3050 3485 (b) Trade Payables 626 585 876 859 (c) Other Current Liabilities 395 517 7226 7537 (d) Short Term Provisions 44 42 110 80 1405 1446 11261 11961 TOTAL 3563 3375 30362 27359 65#66Key Financials 2014-15 contd. Standalone Consolidated Particulars ASSETS Non-Current Assets (a) Fixed Assets (b) Goodwill on Consolidation (c) Non-Current Investments 2014-15 2013-14 2014-15 2013-14 941 891 1206 1167 0 0 354 352 1523 1506 2314 1869 (d) Deferred Tax Assets (Net) 0 0 206 131 (e) Long Term Loans and Advances 53 65 238 225 (f) Receivable under Financing Activity 0 0 15468 13351 (g) Other Non-Current Assets 0 610 614 2516 2462 20397 17709 Current Assets (a) Current Investments 0 0 351 247 (b) Inventories 468 370 614 495 (c) Trade Receivables 478 446 634 614 (d) Cash and Cash Equivalents 26 30 1060 1230 (e) Short Term Loans and Advances 75 67 144 553 (f) Receivable under Financing Activity 0 0 6716 6077 (g) Other Current Assets 0 0 447 434 1047 913 9965 9650 TOTAL 3563 3375 30362 27359 66 99 murugappȧ figures in Crores#67Key Financials 2015-16 murugappa Standalone Consolidated Particulars 2015-16 2014-15 2015-16 2014-15 Q3 Q3 Q3 Q3 Net Sales/Income from Operations 868 898 1391 2328 Growth % -3% 9% -40% 10% Total Income from Operations (Net) 902 942 1509 2469 Growth % -4% 8% -39% 11% EBITDA 80 72 129 319 % to Sales 9% 8% 9% 14% PBIT Before Exceptional Item 53 47 108 279 % to Sales 6% 5% 8% 12% PBIT After Exceptional Item 54 35 109 267 % to Sales 6% 4% 8% 11% Profit Before Tax 21 -0.9 75 230 % to Sales 2% 0% 5% 10% Profit After Tax (before Minority Interest) 16 -0.4 53 154 % to Sales 2% 0% 4% 7% Net Profit 16 -0.4 112 87 % to Sales 2% 0% 8% 4% 67#68Key Financials 2015-16 contd G murugappa Standalone Consolidated Particulars 2015-16 2014-15 2015-16 2014-15 YTD YTD YTD YTD Net Sales/Income from Operations 2770 2790 5905 6915 Growth % -1% 11% -15% 11% Total Income from Operations (Net) 2878 2924 6280 7330 Growth % -2% 11% -14% 12% EBITDA 257 237 731 910 % to Sales 9% 8% 12% 13% PBIT Before Exceptional Item 186 178 637 799 % to Sales 7% 6% 11% 12% PBIT After Exceptional Item 188 167 638 788 % to Sales 7% 6% 11% 11% Profit Before Tax 85 62 533 682 % to Sales 3% 2% 9% 10% Profit After Tax (before Minority Interest) 59 44 356 460 % to Sales 2% 2% 6% 7% Net Profit 59 44 313 277 % to Sales 2% 2% 5% 4% 68 88#69Corporate Office: Tube Investments of India Ltd. "Dare House", 234 N S C Bose Road, Chennai-600 001, India. +91 44 4217 7770 +91 44 4211 0404 [email protected] murugappa G 69