1. V K Mehta Executive Director Long products & International Trade Indian Steel Markets 2011 15-16 th March 2011 Gurgaon

2. Construction Construction as a sector can broadly be divided into three major categories: CONSTRUCTION InfrastructureReal EstateIndustrial Roads, Railways, Bridges, Ports, Airports, Power, Irrigation Commercial, Retail, Housing Metal Refineries Fertilizers, Petrochemicals, Cement, Oil & Gas

3. Dominant Steel Consuming Sector Double digit growth ~10.5% in FY 11-12 Still predominantly Cement based Ready to use raw materials, prefab construction gaining momentum Indian Construction Distinct shift towards quality & quality raw materials

4. Source: CRISIL Research Construction & infrastructure contribute to >60% of steel consumption

5. Expected to cross $100 billion from FY 2011-12 onward Source: Indian Economy, SAIL Research In $ billion

6. Investment as % of GDP constantly rising Source: Juggernaut is starting to roll…., India: Construction: Infrastructure, Goldman Sachs via Thomson Research, 11.10.10

7. SectorKey Opportunities PowerGovernment targets adding 100,000MW capacity by 2012 Both generation and transmission capacities being enhanced significantly Oil & gasPipeline network, city gas distribution, refinery infrastructure installation & upgrading Road & highways National Highway Development Program (NHDP) Plans to construct and upgrade >50,000 km of national highway by Dec 2015 RailwaysDedicated Rail Freight Corridor (DRFC) network expansion lagging freight growth; this needs to be expedited PortsPort traffic is estimated to increase by a CAGR of about 12% during 2010-12 Water & waste management The Jawaharlal Nehru National Urban Renewal Mission is expected to increase steel consumption

8. 6/4/2014 8 POWER WORLD AVERAGE PER CAPITA CONSUMPTION AT 2500 kwh / YEAR INDIA - INSTALLED CAPACITY DISTRIBUTION THERMAL :65% HYDRO-POWER : 25% NUCLEAR : 2.9% OTHERS (RES) : 7.7% Opportunity for steel use in power generation, transmission and distribution Source. : MoP Power Sector PER CAPITA COMSUMPTION (Kwh/Year) Installed Capacity (,000MW) Power sector is one of biggest steel user

9. Source: IDFC-SSKI Research Traffic load in million tons Tardy growth of 3% in railways network in 15 yrs. Railways share only 30%, despite being cheap & faster. Container operations still insignificant at 1%.

10. CategoryShort term target (10-11 to 11-12) Long term target (12-13 to 19-20) Total target Doubling (Indl DFC) 1000 kms11000 kms12000 kms Gauge conversion 2500 kms9500 kms12000 kms New Lines1000 kms24000 kms25000 kms Electrification2000 kms12000 kms14000 kms New Wagons33909255227289136 High Speed Corridors ---2000 kms The vision call for around $ 310 billion of investment over next 10 years Source: Ministry of Railways

11. 6/4/2014 11 Source. : Dept. Of Road Transport & Hways Transport – Road Network National Highway(000 Km) Plan 20 Km of NH per day Road Type Length 000km % share of total length Traffic Distrib ution National / Express Highways 70.72%40% State Highways 132.04%40% Major & District Roads 467.814% 20% Rural & Other Road 2,650.080% Total3320.4100% Projects under implementation NHDP-I & II – $14.3 billion NHDP- III - $17.8 billion NHDP -IV – $ 6.1 billion NHDP –V – $ 9.1 billion NHDP –VI – $ 3.7 billion

12. In million tons Source: india Transportation: sea & Land Cargo.. Nomura International Ltd Via Thomson Research GOI FY12 plan is 1 billion tons

13. Transport – Airports Source: Min of Aviation At Airports in Lakhs in 000 tons More & more modern & private airports As per estimates the steel consumption in airport building likely to grow >20% Development of Tier-II city airports will sustain consumption growth. Steel intensive construction

14. Indian economy is estimated to grow @8.6% in 2010-11& @9.0% in 2011-12. Construction growth is stunted @ 7-8% presently. Distinct surplus of construction steel in India High inflation ( expected at 9%) is a huge concern. Credit squeeze also adversely affecting construction. High-end reality (Commercial, retail & housing) severely impacted.