1. 1 Ambuja Cement Presentation By Ambuja Cement November 19, 2003

2. 2 Ambuja Cement Indian Economy GDP Growth - Estimates ( 2003 - 2004) 1Q 2004 (A)Estimated ’03-04 Service Sector 7.6 % 7.3 % Industrial Sector 5.8 % 5.0 % Construction Sector 5.7 % 6.7 % Agriculture Sector 1.7 % 10.7 % CMIE - Estimates Economy expected to grow by about 7.4% A- Actual

3. 3 Ambuja Cement Cement in India Why ? ãIndian economy will keep growing in band of - 5 - 7% annually ãTo achieve larger GDP growth rate Country will need more Roads, Ports, Irrigational facilities & other Infrastructure ãHousing will continue to be a major construction area ãCement as a product or technology does not suffer from obsolescence ãThere is no “Substitute” for Cement

4. 4 Ambuja Cement Roads - New Dimension ã Major Investments in Road Development ã Special Cess of Rs. 1.50 per liter on petrol and diesel for Road Development ã Total outlay over next 2/3 years - Rs. 600 Billion

5. 5 Ambuja Cement Road Development Golden Quadrilateral- 5846 Sq.. Km (Already Completed 1408 km)(Expected completion - June 2005) North-South & East-West Corridors - 7300 Sq.. Km ( Already Completed 980 km) (Expected completion - 2007) 48 New Road project - 10000 Km. (Expected completion - 2006) Government commits to 25% Concrete Roads Expected additional consumption -3/4 mn tonnes per annum Source : NHAI

6. 6 Ambuja Cement Housing Construction Huge potential: Unfulfilled demand - 33 mn units Increasing disposable income Younger generation aspiring to have “Own House” Low real estate prices Easy availability of Housing Finance - Growing over 30% Interest Rates have come down by 700 bps in last 3 years Monthly instalment on mortgage is now equivalent to rentals

7. 7 Ambuja Cement Cement Supply Other side of the equation

8. 8 Ambuja Cement Cement Supply - The Dynamics Cement Production 2003 111 mn tonnes Maximum Clinker Production Capability (Including Sanghi) 103 mn tonnes Current Clinker to Cement Conversion Ratio (the best in last 5 years) 1.21times Maximum Cement Production Capability 127 mn tonnes at Conversion Ratio - 1.23

9. 9 Ambuja Cement Cement Supply - A Reality Check ãNo new cement capacity under construction ãLenders unwilling to fund new cement plants ãMaximum Cement production capability at a conversion ratio of 1.23 - 127 mn tonnes ãExisting players going through Consolidation

10. 10 Ambuja Cement Indian Cement Industry Next 3 Years Financial Clinker Cement Cement Demand YearCapacity ConversionProduction Ratio at Peak 8% ( Maximum Level) 2003(A) 103 - 111 111 2004(E) 103 1.21 125 117 2005(E) * 105 1.22 128 126 2006(E) * 107 1.23 132 136 mn tonnes A- Actual E- Estimated * On account of some debottlenecking

11. 11 Ambuja Cement Cement Outlook ãCement demand growth should exceed 8% if the GDP is growing at over 6 % ãFY 2003-04 would be the First year in last decade to not to have a single new plant commissioning ãNext 2 years also there is no new capacity expected ãCement Demand to expected exceed Supply after a gap of several years All these point to good demand & better Cement Prices

12. 12 Ambuja Cement Sea terminals Cement factories HP Gujarat Rajasthan Chattisgarh WB Maharashtra Punjab mn tonnes 1986 2003 Capacity 0.7 14.0 Ambuja Cement Growth of 20 times in 15 years

13. 13 Ambuja Cement Growth With A Sound Business Model

14. 14 Ambuja Cement Our Business Model ã Own Infrastructure -Logistics Management ã Strong brand & efficient distribution ã Presence in prime markets ã Lowest cost cement producer

15. 15 Ambuja Cement Own Infrastructure ã7 Owned Cement Ships for transporting Cement by Sea ãLarge port in Gujarat to handle export of Cement ( 2 mn tonnes this year) & Import of Coal / Oil ã3 Cement receiving terminals ã190 MW of Captive Power Plants at various Cement Plants to give reliable and cheap power

16. 16 Ambuja Cement Strong Brand India - A bagged market Individual home builder - key driver of demand Our focus : ãBest quality cement ãGood packaging ãLogistic management - strong distribution network ãCustomer service Ambuja Cement - Most preferred brand - Fetching higher realisation

17. 17 Ambuja Cement Lowest Cost Producer FY 2003FY 2002 Increase / (Decrease) (%) Power 187 179 4 Fuel 227 254 (11) Raw material 136 133 2 Consumables 47 48 (2) Direct cost 597 614 (3) Rs./ tonne

18. 18 Ambuja Cement Gujarat Ambuja Cement - Shareholding GAC ( 12 mn ) 40% ACIL 60% Pvt. Equity Investors ACC ACEL 14.4% 94% ( 17 mn ) ( 2 mn )

19. 19 Ambuja Cement Convertible Bonds Brief terms: Date of Issuance January 2001 Coupon 1%p.a. Maturity January 2006 Conversion Price Rs. 222 Conversion Into GDRs/ Shares Amount US$ 100 million Conversion Option of the Bondholder Any time till maturity Yield to maturity at redemption 4.6% Call Option of companyFrom January 2004 till Maturity

20. 20 Ambuja Cement Gujarat Ambuja Cements Limited (Effect of Conversion) Before After Sources of Funds Shareholders’ Funds 16166 20680 Deferred Tax 3053 3053 Convertible Bonds 4614 -- Debt 12436 12436 Total 36269 36269 Application of Funds Gross Fixed Assets 30239 30239 Less: Depreciation 10120 10120 Net Fixed Assets 20119 20119 Investments in ACIL 8572 8572 Other Investments 2445 2445 Net Current Assets 5133 5133 Total 36269 36269 Rs. Million

21. 21 Ambuja Cement % Tenor Long Term 79 Short Term 21 Total 100 Mix Rupee Debt 56 Foreign Currency Debt 44 Total 100 Debt Profile (As of 30.9.2003)

22. 22 Ambuja Cement Gujarat Ambuja Cement Limited Valuation EV/Ton US$ 90 EV/EBIDTA 9 times Cash Earning per Shares (CEPS) Rs. 27 Earning Per Shares (EPS) Rs. 14 Price to Cash Earning 10 times Debt/ Equity -( on Conversion) 0.60 Debt/ EBIDTA - (on Conversion) 2.4 times

23. 23 Ambuja Cement THANK YOU