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Everest Kanto Cylinder Ltd. Disclaimer The information contained in this presentation is only current as of its date and consists of information that.

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Presentation on theme: "Everest Kanto Cylinder Ltd. Disclaimer The information contained in this presentation is only current as of its date and consists of information that."— Presentation transcript:

1 Everest Kanto Cylinder Ltd

2 Disclaimer The information contained in this presentation is only current as of its date and consists of information that is already in the public domain or that is not price sensitive. All actions and statements made herein or otherwise shall be subject to the applicable laws and regulations as amended from time to time. We will accept no liability whatsoever for any loss arising directly or indirectly from the use of, reliance of any information contained in this presentation or for any omission of the information. It is advised that prior to acting upon this presentation, independent investigation including seeking advice of your financial, legal, tax and professional advisors as to the risks involved may be obtained and necessary due diligence, etc may be done at your end. This presentation may contain certain statements of future expectations and other forward-looking statements, including those relating to our general business plans and strategy, our future financial condition and growth prospects, and future developments in our industry and our competitive and regulatory environment. Actual results, performances or events may differ materially from these forward-looking statements including the plans, objectives, expectations, estimates and intentions expressed in forward looking statements due to a number of factors, including without limitation future changes or developments in our business, our competitive environment, and political, economic, legal and social conditions in the countries we operate in. This presentation is not being used in connection with any invitation of an offer or an offer of securities and should not be used as a basis for any investment decision.

3 Established in June, 1978 Began with a Joint venture with Kanto Koatsu Yoki Manufacturing Company of Japan Pioneer in production and development of Industrial and CNG cylinders with dominant market share in South Asia and Middle East Largest global player in the Large Pressure Vessel space Three manufacturing plants in India and one each in Dubai, China and U.S.A. Existing capacity of 1 Million cylinders of all sizes mainly by way of organic and acquisition growth Ambitious organic growth plans in India and China Almost 1000 employees on rolls worldwide experienced in R&D, production and management Quality control processes approved in more than 20 countries EKC – An Introduction

4 EKC – Key Milestones Incorporation of Everest Kanto Cylinder (P) Limited 1978 First commercial production at Aurangabad Plant 1981 Commissioning of Tarapur Plant 1988 Development of CNG cylinder for the markets 1998 Supply of CNG Cascades 1998 Export to European countries 1998 More than 150,000 cylinders produced and dispatched 2001 Commencement of production at Dubai Plant 2004 Listing of Equity Shares and Gandhidham unit goes onstream 2005 Doubling of Capacity in Dubai and initiation of China Project 2007 Commencement of exports to Gulf countries 1986 Acquisition of CPI, U.S.A. and commencement of production in China 2008

5 EKC – Product Applications

6 EKC – Key Customer profile Industrial Cylinders –Praxair –BOC India Ltd –Inox Air Products Ltd –Advanced Silicon –Air Products –Air Liquide CNG Cascades –Mahanagar Gas Ltd –Indraprashtha Gas Ltd –Bhagyanagar Gas Ltd –Gujarat Adani OEMs for CNG Cylinders –Hyundai –Toyota –Suzuki –Tata Motors Ltd –Eicher Motors Ltd –Ashok Leyland & Co Ltd –Swaraj Mazda Special Cylinders –Defence Department in India –US Navy

7 Automobile CNG Cylinder

8 Jumbo Trailer Project India & China

9 EKC’s Competitive Edge First mover advantage in CNG space in Asia Existing Production Capabilities & Capacities and expansion plans leading to economies of scale which gives edge over competition New manufacturing facilities to adopt cost effective technologies and processes Supply Chain Advantage – Relationship with Tenaris going back to 15 years Strong Customer relationship especially with OEMs and after market players Regulatory approvals in over 20 Countries

10 EKC – Manufacturing Facilities Location Established / Acquired Product Range (In Lts.) Capacity (In Nos.) Industrial CNG Jumbo Total Aurangabad , Tarapur , ,000 Dubai ,000 - Gandhidham , , ,000 China and Jumbo 80, ,000 10, ,000 USA2008Jumbo - - 4,000 GRAND TOTAL 410, ,000 14,000 1,020,000

11 EKC – Historical Key Financial Highlights

12 H Results Highlights High Growth in Turnover driven by organic expansion in China and inorganic acquisition of CPI, USA Growth in CNG business continues to be robust with increased penetration of Indian, Middle East and CIS markets Significant increase in output from Dubai unit and optimum utilisation of Indian facilities EBITDA margins increase substantially aided by increased selling prices and better product mix and despite steep devaluation of INR vis a vis US$ Higher interest, Depreciation and amortisation mainly due to acquisition of CPI and commencement of China operations

13 H Results Highlights H1 2008H1 2007Change Turnover (Rs. Million) 4,101 2, % Turnover (US$ Million) * EBIDTA (Rs. Million) 1, % EBIDTA (as % of Turnover) 32.0% 29.5% PAT (Rs. Million) % PAT (US$ Million) * EPS (Rs. Per Share) % * 1 US$ = Rs

14 H Results

15 H Results Highlights Turnover by Markets H H

16 H Results Highlights Turnover by Products H H

17 Global NGV growth outlook Benefits of Natural Gas Vehicles include  Reduced Particulate and greenhouse gas emissions and safer than most liquid fuels  Widespread availability of NG which can also be derived from renewable sources like biogas  Technically proven and available at lower cost  Can be used in all types of vehicles  Minimal processing or refining requirements NGV growth has more than doubled during last five years As per Gas Vehicles Report dated June 2008, there are 8.5 Million vehicles worldwide and IANGV projects that this would increase to a level of 50 Million vehicles by 2020

18 Global NGV growth outlook Among top 10 countries, the number of NGVs has increased from a level of 1.7 Million in 2001 to a level of 7.6 Million in March 2008 EKC has a significant presence in six of these countries which still have a low penetration rate of NGVs in the overall vehicle population International Gas Union has projected that the total global NGV population shall increase to a level of Million by the year 2030 and the final target shall be announced in 2009

19 Global NGV statistics – Top Ten countries Top ten countries represent 89% of global NGV population Compound Annual Growth rate (CAGR) over last 7 years - 24% globally -42% for Asia and CIS Very low penetration rate of NGV vehicles -6.1 % globally -5.9 % for Asia and CIS -2.0% for high growth markets like India and China No. of NGVs (In ‘000) CountryMarch-01March-08 Argentina Pakistan Brazil India25822 Iran1730 Italy Colombia9252 China36201 Bangladesh22160 Ukraine35120 Total

20 Natural Gas Scenario to positively impact CNG business in India Natural Gas infrastructure spans 8000 Kms with product pipeline of Kms Compressed Gas Distribution (CGD) networks in 19 cities - More than 0.8 M vehicles on CNG - More than 0.8 M households connected Expression of interest for CGD in 68 cities to be implemented over 2-5 years with investment ranging from US$ 50 – 200 Million in each city Projected Gas Supply expected to increase from 80.5 MMSCMD to a level of about 200 MMSCMD in

21 EKC’s Global Business Outlook China plant commenced production in May 2008 and large line expected to go into production very shortly Integration activities with CPI progressing well resulting in improved production levels Billet Piercing Plant to be operational in this fiscal year and this is expected to lower cost of production thereby making the products more cost competitive Jumbo Cylinder Plant in India is scheduled to go into production in Q and EKC expects to penetrate the untapped Indian market for such products by leveraging CPI’s capability in this line of business EKC is venturing into the market for light weight CNG cylinders mainly required by OEMs in Europe and Asia and this project is expected to go into production in Q This would result in much higher value addition besides providing value to customer INR expected to continue to be under pressure but overall impact not significant on the bottomline

22 Thank You


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