JAI BALAJI INDUSTRIES LTD. - Jai Balaji Group

JAI BALAJI INDUSTRIES LTD.
Corporate Presentation

Disclaimer
No representation or warranty, express or implied, is made as to, and no reliance should be placed on, the fairness, accuracy, completeness or correctness of the information or
opinions contained in this presentation. Such information and opinions are in all events not current after the date of this presentation. Certain statements made in this presentation may
not be based on historical information or facts and may be "forward looking statements" based on the currently held beliefs and assumptions of the management of Jai Balaji Industries
Limited (“Company” or “Jai Balaji”), which are expressed in good faith and in their opinion reasonable, including those relating to the Company’s general business plans and strategy, its
future financial condition and growth prospects and future developments in its industry and its competitive and regulatory environment.
Forward-looking statements involve known and unknown risks, uncertainties and other factors, which may cause the actual results, financial condition, performance or achievements of
the Company or industry results to differ materially from the results, financial condition, performance or achievements expressed or implied by such forward-looking statements, including
future changes or developments in the Company’s business, its competitive environment and political, economic, legal and social conditions. Further, past performance is not
necessarily indicative of future results. Given these risks, uncertainties and other factors, viewers of this presentation are cautioned not to place undue reliance on these forward-looking
statements. The Company disclaims any obligation to update these forward-looking statements to reflect future events or developments.
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2

Background
Jai Balaji Industries Ltd. (“JBIL” or “Company”) was incorporated in
1999 by the current promoters, Mr. Aditya Jajodia, Mr. Sanjiv Jajodia
and Mr. Rajeev Jajodia
Integrated steel manufacturing company
* Source: West Bengal Sponge Iron Manufacturers Association (Aug 2009)
** Annual reports of Jai Balaji Industries Limited (formerly known as Jai Balaji Sponge Limited (JBSL)): Growth with respect to JBSL. JBSL and another Jai Balaji Group Company, Shri Ramrupai Balaji Steels Ltd.
3
(“SRBSL”) merged in FY07
―
―
―
―
―
Established its 1st Sponge Iron Plant in 2000 with an initial
capacity of 50 tons per day
Currently amongst the largest integrated steel producers in
West Bengal*
Metallics’ capacity of c. 1 million tons per annum (“MnTPA”)
Products range from metallics (Sponge Iron and Pig Iron) to
steel products (TMT bars and Alloy Steels).
Also currently developing Ductile Iron Pipes and expanding
rolling mill facilities to manufacture alloy steel bars
Listed on the National Stock Exchange and Calcutta Stock Exchange
in 2003 and on the Bombay Stock Exchange in 2008 with market
capitalization of c. Rs. 12,250 million as at 26 August 2009
High growth in last 5 years
―
Gross block (as at 31 March 2009) of Rs. 14,119 million, grown
at a CAGR of 99% y-o-y**
― Annual revenue of Rs. 17,495 million for FY09 , grown at a
CAGR growth of 70%**
Strategic institutional investors
–
–
Citigroup Venture Capital invested Rs. 2,000 million in February
2008 and currently has a c. 11% stake including Board
representation
India Equity Partners invested Rs. 733 million in February 2008
for a c. 4% stake including Board representation

Jai Balaji Strengths
Integrated operations
Single location integrated operations (at Durgapur) with
Blast Furnace/Kiln for metallics and Induction/Electric
Arc Furnace for steel making
Forward integration into thermo mechanically treated
bars (“TMT”) Rods, Billets as well as Ductile Iron Pipes
and Alloy Steel Bars (in process)
Backward integration infrastructure including Sinter
Plant, Coal Washery, Captive Power Plants, Coke Oven
(in process) and raw material sources of mines which
are expected to be operational in the next couple years
Logistics infrastructure
Company has built 3 private sidings and procured 4
rakes of 61 wagons each under the Wagon Investment
Scheme (“WIS”) of Ministry of Railways, GoI
Assured supply of 32 rakes per month from the Indian
Railways and 10% discount on freight for the first 24
rakes (75% of rake availability)
Majority of raw materials and finished products are
transferred via rail network thereby reducing freight
costs
Cost efficiency Strong business operations
Geographic proximity to raw material sources
All manufacturing facilities are located in the middle of
India’s mineral belt in the eastern region
Proximity to iron-ore and coal mines
Well connected by ports and other logistics network
Demonstrated project execution skills
Company expanded metallics’ capacity from 105,000
TPA in 2005 to c. 1 MnTPA in 4 years (CAGR of 74%)
Proven track record in implementing expansion plans
on a timely basis and without incurring significant cost
overruns
All capacity expansions except for acquisition of
Nilachal Iron and Power Limited (“NIPL”) and steel
division of HEG Limited (“HEG”) have been organic
Experienced management team and skilled employee base
The Promoters have been in the steel and ferro alloy
industry since 1991
Senior project and technical team members have
extensive industry experience
Total employee strength of 7,101 employees (4,500
contract employees and 2,601 direct employees) as on
30 June 2009
Subsidies under the West Bengal Investment Scheme, 2000
and West Bengal Power and Intensive Industries Scheme,
2004 for the Durgapur Plant
Industrial promotion assistance including the state
capital investment subsidy
Power subsidy
Capital investment subsidy
Interest subsidy
4

On Its Way to Become Fully Integrated…
Raw Materials
Metallics
954,250 TPA
Billets and
finished
products
Sponge Iron
MS Billets
TMT Rods
Non-coking Coal (Dumri)*
38.14 Million Tons (“MnT”)
expected in FY10
Coal Washery
216,000 TPA
800,000 TPA (in process)
DRI Kiln (Sponge iron)
445,000 TPA
60,000 TPA (in process)
Induction Furnace Billets
473,230 TPA
TMT Rolling Mill
260,000 TPA
Backward and forward integration in process External Sales
Iron Ore Lumps
Ferro Alloy
106,618 TPA
Ferro Alloy
Captive Power Plant
71.1 MW
40 MW (in process)
Iron Ore Fines
Sinter Plant
608,256 TPA
Electric Arc Furnace
433,000 TPA
Alloy Bars Rolling Mill
300,000 TPA (in process)
Alloy Billets
Coking Coal (Rohne) **
17.23 MnT
Coke Oven
300,000 TPA
Blast Furnace (Pig Iron Plant)
509,250 TPA
Alloy Steel
Bars
Ductile Iron Pipe
240,000 TPA
Ductile Iron Pipes
* Estimated proven/indicated reserves of 55.99 MnT Non-coking coal block, obtained through acquisition of Nilachal Iron and Power Limited of which the Company has a 68.12% share and rest with Bajrang Ispat Pvt ltd
** Allocated coking coal block in consortium with JSW Steel and Bhushan Steel with tentative extractable reserve of 250.00 MnT of which Company’s share is c.17.23 MnT
5
Pig Iron

Established Project Execution Skills
Sales mix over last 5 year (Rs million)
Billets,
Billets 2,588
2,588m
Capacity Expansions Jai Balaji Sponge Ltd. Merger with SRBSL* Acquisition of HEG & NIPL*
BY FY 2005 FY 2006 FY 2007 FY 2008 FY2009**
Finishing Lines TPA 30,118 (Ferro Alloy) 80,000 (Re-rolling)
180,000 (Re-rolling)
Ferro
Alloy,
689
TMT
Bars
4,901
Pig Iron
1,943
Sponge
Iron
1,027
Billets
2,374
51,000 (Ferro Alloy) 25,500 (Ferro Alloy)***
Metal Capacity TPA 79,200 (MS Billets) 235,224 (MS Billets) 158,806 (MS Billets) 433,000 (Alloy Billets)
Metallic’s TPA 105,000 (Sponge Iron) 120,000 (Sponge Iron)
Backward Integration
Billets / MS
Ingots
832
Sponge
Iron
514
12 MW Power Plant
Moving up the value chain
Sponge
Iron,
1,080
509,250 (Pig Iron)
216,000 TPA Coal Washery
220,000 (Sponge Iron)
40 MW Power Plant 12.8 MW Power Plant
Logistics 2 Rakes under WIS 2 Railway Sidings
Established in FY06
Billets / MS
Ingot
1,656
Silico
Manganese 30
* Source: Annual reports of Jai Balaji Industries Limited (formerly Jai Balaji Sponge Ltd.)
** Ferro Alloy of 25,500 TPA came up in Q1FY10
***June 2009
Sponge
Iron
380
TMT
Bars,
2,255
Ferro Alloy
290
Pig Iron,
61
1 Rake under WIS
Ferro Alloy
1,597
TMT Bars
5,416
Pig Iron
3,664
608,256 TPA Sinter Plant
6.3 MW Power Plant
1 Railway Siding
1 Rake under WIS
Sponge
Iron,1,859
Billets
4,502
6

Cost Effective Logistics Infrastructure
Private railway sidings
Railway rakes
Company estimates rail transport to be over 50% cheaper than road transport; however
transport is limited by siding congestion and non-availability of rakes and locomotives
Approximately 3 tons of raw material required for every 1 ton of steel
Company has already invested in 3 railway sidings at the plant facility and at raw material
sourcing locations in Orissa and Chhattisgarh at a cost of Rs. 412m
Procured and delivered 4 railway rakes of 61 Box Wagons each to Indian Railways under
the Wagon Investment Scheme at a total cost of Rs. 546m
Most raw materials transported via rail network
Assured allotment of 32 rakes per month from Indian Railways
10% discount on the freight charges for first 24 rakes under the scheme (75% of rake
availability)
Increased flexibility in delivering finished goods
Reduced freight costs
Reduced pilferage, theft and ground loss in transporting raw materials
Reduced turnaround time
Benefits
7

Proximity to Raw Material
Eastern region coal-belt
Eastern region iron-ore belt
HEG, Chhattisgarh
Coal Mines allocated to Company
Existing Facilities
Greenfield expansion
Rohne, Jharkhand
(Coking Coal Mine)
Dumri, Jharkhand (Non-
Coking Coal Mine)
Purulia
ge^ohe^ka tbpq=_bkd^i
NIPL, Jharkhand
Durgapur, WB
Raniganj, WB
Andal, WB
Non-coking Coal
Kolkata, WB
Haldia, WB (Port)
8

Experienced Promoters
Mr. A. Jajodia
Chairman and
Managing Director
Age: 38 years
Mr. S. Jajodia
Whole-time Director
Age: 45 years
Mr. R. Jajodia
Non-executive Director
Age 44 years
Gourav Jajodia
Non-executive Director
Age 29 years
Bachelor of Commerce (Honors) from St. Xavier’s College, Kolkata
Over 15 years of experience in the steel and power industry
Responsible for all major financial and strategic decisions
Under his guidance, both the Jai Balaji Group Companies - Jai Balaji Sponge Limited and Shri Ramrupai Balaji Steels Limited – went public on the
Indian stock exchanges
Bachelor of Commerce (Honors) from St. Xavier’s College, Kolkata
Over 2 decades experience in the steel industry
Supervises and controls overall administration, legal aspects, human resource as well as financial planning of the Jai Balaji Group
Joined the Group in 1991 with Chandi Steel Industries Ltd.
Bachelor of Commerce (Honors) from St. Xavier’s College, Kolkata
Over 2 decades experience in the steel industry
Manages the operations of the Company and supervises the iron ore and coal linkages, and procurement of other raw materials
Also supervises the sales and marketing function of the Jai Balaji Group
Instrumental in getting coal allocation and implementing railway sidings and purchasing rakes from Indian Railways
Joined the Group in 1991 with Chandi Steel Industries Ltd.
Bachelor of Commerce (Honors) from St. Xavier’s College, Kolkata
Over 5 years of experience in the steel industry
Supervises the operations and the production process of the Company
Joined the Company in 2008
9

Qualified Management Team
Mr.Chandramukh
Patnaik
Executive Director
(Projects)
Age: 57 years
Mr. Raj Kumar Sharma
Chief Financial Officer
Age: 42 years
Mr.S.K. Sachan
Vice President (Projects)
Age: 39 years
Mr. Partho Kumar Roy
Vice President
(Marketing)
Age: 54 years
Mr. John Joseph
Vice President (HR)
Age: 48 years
Mr. Bivas Chakraborty
Deputy General
Manager
Age: 43 years
B.Tech. and M.Tech. in Chemical Engineering from IIT Kharagpur
Spearheading the 5 MnTPA greenfield integrated steel project at Raghunathpur, Purulia Dist of West Bengal
Over 30 years of experience in operation and projects in major steel companies like Tata Steel, Essar Steel, Ispat, Saudi Iron and Steel, Jindal Stainless
and Uttam Galva
Prior to joining JBIL worked as ED (Technology) with Jindal Steel & Power Limited
B.Com. and ICWA
Over 18 years of experience in finance and accounts with various companies
Responsible for Company’s finance and accounts operations and other financial strategies
Prior to joining JBIL worked with Adhunik Group
B.Tech. in Mechanical Engineering from Regional Engineering College, University of Raipur
Leading the company’s expansion and brown field projects at Durgapur, West Bengal
Over 17 years of experience in project implementation in major steel companies like Malvika Steel and Jindal Steel & Power
Prior to joining JBIL worked with Visa Steel Limited in project implementation
B.Tech. in Metallurgical Engineering from Banaras Hindu University
Responsible for the development of markets and sale of alloy steel
Over 30 years of experience in marketing of alloy steel products in companies like Gonterman Pipes and Bihar Alloys & Steel Limited
Prior to joining JBIL worked with Usha Martin Industries Limited as Vice President (Marketing)
M.A.(SW) from the University of Madras
Responsible for formulation and implementation of human resource strategies for the Company
Over 24 years of experience in all aspects of HR with leading companies like Bharat Heavy Electricals Limited, Shalimar Paints and the OP Jindal
Group
Prior to joining JBIL, headed corporate HR for Jindal Steel & Power limited
B.Sc. from Calcutta University
Responsible for the development of markets and sale of ductile iron pipes (DI Pipes)
Over 20 years of experience in marketing and sale of DI Pipes and other pipe solutions in companies like Bengal Tools Limited and Electro Steel
Casting Limited.
Prior to joining JBIL worked with Doshion-Veolia Water Solution Company as Manager (M&S) for its EPC division
10

Company Strategy
Coal
Implement planned expansion
MoA with Government of West Bengal to set-up
an integrated 5 MnT capacity plant at Purulia
Entered into two MoUs with the Government of
Chhattisgarh for the development of an integrated
steel plant and a power plant
TMT Bars
Sustained reduction in raw material procurement costs
Establishing coking coal production at Rohne and
non-coking coal production at Dumri and Andal
East
Establishing iron-ore and manganese mining
operations in Jharkhand
Increased focus on downstream value added
products portfolio
Recently developed Alloy Steel Electric Furnace
with 433,000 TPA
Expanding of Rolling Mill facilities by 300,000 TPA
to produce Alloy Steel Bars
Addition of Ductile Iron Pipe capacity by 240,000
TPA
Captive Power Plant
Sustained reduction in power costs
Expanding waste heat based Captive Power Plant
capacity by 40 MW expected to be operational in
FY10
Use waste heat and solid waste such as dolochar,
coal fines etc. generated from operations to
expand captive power
Ductile Iron Pipe Facility (Under
Construction)
11

Near Term Expansion Plans Leading to …
Finishing Lines
Metal Capacity
Metallic’s
Backward
Integration
Logistics
Facility
Existing Facility
(TPA)
Additions Planned
(TPA)
Total Expanded
Facility (TPA)
Expected Costs
(Rs. million)*
Expected
Commission
Rolling Mill (TMT Rods) 260,000 - 260,000 FY11
Rolling Mill (Alloy Steel Bars) - 300,000 300,000 400
Ductile Iron - 240,000 240,000 1,400** FY10
Ferro Alloy 106,618 106,618 - -
MS Billets 473,230 473,230 - -
Alloy Steel Billets 433,000 433,000 - -
Pig Iron 509,250 509,250 - -
Sponge Iron 445,000 60,000 505,000 400
Coal Mines -
38.14 MnT Dumri
and 17.23 MnT
Rohne mines
850
Dumri in FY10
Rohne in FY12
Coal Washery 216,000 800,000 1,016,000 250 FY11
Coke Oven - 300,000 300,000 2,400 FY12
Sinter 608,256 - 608,256 - -
Waste Heat Captive Power
Plant
71.1 MW 40 MW 111.1 MW -*** FY10
Railway Rakes under WIS 4 (61 wagons each) - 4 (61 wagons each) - -
Private Railway Siding 3 Sidings - 3 Sidings - -
* Expected costs over FY10, FY11 and FY12
** Balance amount to be spent in 2009-10: Total cost of Rs. 2,680 million
*** Total costs of Rs. 1,100 million of which c. 95% have been incurred until FY09 (shown in Capital WIP) and will capitalized in the current year
12

… Reduced Raw Material and Power Costs
Product Highest cost Medium cost Low cost
Iron-ore Spot market
Acquire Iron Ore Lumps from spot
market
Coking coal Spot market
Initially Company purchased low ash
Met coke at spot rates
Given rising prices, Company has
commenced buying in bulk through
merchant importers on high sea
basis
Non-coking
coal
Sinter plant
Purchases lower cost Iron Ore Fines from
local vendors and converts to lumps in a
sinter plant
Commissioned a 608,256 TPA plant in
September 2008
Captive coke oven
Establishing a 300,000 TPA coke-oven
for its Durgapur plant
Total costs expected to be Rs. 2,400m
Spot market Linkage from Coal India Limited
A 216,000 TPA Coal Washery set up to
wash coal from the mines in order to
lower the ash content
Another 800,000 TPA Coal Washery
being set up in Jharkhand for the Dumri
coal mines
Power Market access Grid supply from the State Government
Estimated around 40% of power
requirements is met via waste heat based
captive generation while the balance 60%
accessed via state grid
Current Status Future Plans
Owned mines
NIPL has been granted mining lease over 450
hectares for Iron Ore and Manganese ore
mining in Jharkhand
Geological survey for these mines is expected
to start in 3 rd quarter of FY10
Captive coke oven and owned mines
NIPL allocated Coking Coal block at Rohne in
consortium with JSW Steel Limited and
Bhushan Steel Limited,
Tentative extractable reserve of 250.00 MnT
in which Company’s share of coal is
approximately 17.23 MnT
Expected to be commissioned in FY12 and
will contribute to most of the requirement
Owned mines
Allocated Non-coking Coal block at Dumri
which has estimated proved reserves of
55.99 MnT of coal, and the Company has a
68.12% share (38.14 MnT)
Mining plans at Dumri have been prepared
and commercial production is expected by
FY10, resulting in significant savings
Also allocated another mine with estimated
geological reserve of 700 MnT with Company
share being 229.50 MnT
Captive Power Plant
Generate power from waste heat and solid
waste such as dolochar, coal midlings etc.,
generated from operations
Another 40 MW to be commissioned by 3 rd
quarter of FY10
13

Organic Growth in Purulia
Purulia Plant
Plant Site
Signed a development agreement with the Government of
West Bengal (“GWB”), the West Bengal Industrial
Development Corporation Ltd. and the West Bengal
Mineral Development and Trading Corporation Limited
(“WBMDTC”), for setting up
―
―
―
5 MnTPA Integrated steel plant
3 MnTPA Cement plant
1,215 MW Captive power plant
c. Rs. 562 million has been incurred including purchase of
land
Current Status
―
―
―
―
―
c. 1,130 acres of land have been acquired from the
GWB
GWB has identified and applied for the allocation of
three coal blocks in the vicinity of the project site in
the name of WBMDTC, which will enter into a coal
mining agreement with the Company
Intend to develop in a modular fashion in phases
through 2017
Teams have started relocating to begin initial process
Water clearance , railways traffic clearance , in
principle approval from state electricity board for
construction power have been received and
application for environmental clearance have been
submitted
14

Production and Sales over last few Quarter
TMT Bars Billets
MnT
Pig Iron Sponge Iron
MnT
60,000
40,000
20,000
0
120,000
100,000
80,000
60,000
40,000
20,000
0
39,68243,109
60,430 57,922
36,581
23,730
27,014
47,077
42,751
45,725
43,584 41,851
39,937
Q1 '09 Q2 '09 Q3 '09 Q4 '09 Q1 '10
Production Sales
42,554
32,433
23,560
95,334
88,110
46,112 45,345
Q1 '09 Q2 '09 Q3 '09 Q4 '09 Q1 '10
Production Sales
MnT
MnT
160,000
140,000
120,000
100,000
80,000
60,000
40,000
20,000
0
120,000
100,000
80,000
60,000
40,000
20,000
0
74,843
39,133
59,934
38,365
78,835
31,156
138,770 138,784
78,539
100,709
Q1 '09 Q2 '09 Q3 '09 Q4 '09 Q1 '10
88,079
19,476
Production Sales
79,686 80,548
25,326 22,385
94,343
9,690
98,493
Q1 '09 Q2 '09 Q3 '09 Q4 '09 Q1 '10
Production Sales
12,696
15

Financial Performance
Net Sales EBITDA and EBITDA Margins
Rs. million
Gross Block Total Loan Funds (excluding CCDs)
Rs. million
20,000
18,000
16,000
14,000
12,000
10,000
8,000
6,000
4,000
2,000
0
16,000
14,000
12,000
10,000
8,000
6,000
4,000
2,000
0
10,188
6,046
13,275
9,870
17,179
FY07 FY08 FY09
14,119
FY07 FY08 FY09
Rs. million
Rs. million
2,500
2,000
1,500
1,000
500
0
18,000
16,000
14,000
12,000
10,000
8,000
6,000
4,000
2,000
0
13.2%
1,349
2,379
17.9%
1,659
9.7%
FY07 FY08 FY09
6,673
11,737
15,454
FY07 FY08 FY09
20%
15%
10%
5%
0%
16

Consolidated Balance Sheet
Consolidated Balance Sheet (Rs. Million) March 07 March 08 March 09
Sources of Funds
Shareholder's Funds
Share Capital 251 471 471
Share Capital Suspense 220 - -
Application Money towards Equity warrants - 618 618
Preference Share Application Money - - 0
Reserves and Surplus 1,988 3,386 3,406
Total Shareholder's Funds
Loan Funds
2,459 4,475 4,495
Secured Loans 5,795 11,090 15,386
Unsecured Loans 878 3,379* 2,801*
Total Loan Funds 6,673 14,470 18,187
Deferred Tax Liability 630 697 772
Total Sources of Funds
Application of Funds
9,762 19,641 23,454
Gross Block 6,046 9,870 14,119
Less: Depreciation 430 967 1,512
Net Block 5,616 8,903 12,606
Capital Work in Progress 477 3,003 3,207
Net Fixed Assets 6,092 11,905 15,814
Investments 2 38 37
Cash 256 213 225
Other Current Assets 4,904 10,465 10,681
Less: Current Liabilities 1,513 2,980 3,303
Net Current Assets 3,648 7,697 7,603
Miscellaneous 20 - -
Total Application of Funds 9,762 19,641 23,454
* Includes Rs. 2733m of CCDs which have been converted in July 09
17

Consolidated Income Statement
Consolidated Income Statement (Rs. million) FY07 FY08 FY09
Sales and Services (Gross) 11,054 15,069 18,953
Less: Excise Duty 866 1,795 1,774
Sales and Services (Net) 10,188 13,275 17,179
Expenses
(Increase) / Decrease in Stocks (93) (921) 649
Excise Duty and Cess on Stocks 18 133 (137)
Raw Materials Consumed 4,037 6,955 11,142
Purchase of Trading Goods 3,413 2,566 720
Manufacturing Expenses 1,279 1,498 2,196
Personnel Cost 64 189 331
Selling, Distribution and Administrative Expenses 123 465 611
Prior Period Expenditure (Net) (3) 10 7
Total Expenses 8,839 10,895 15,520
EBITDA 1,349 2,379 1,659
Less: Depreciation 234 448 541
EBIT 1,115 1,932 1,118
Other Income 200 566 316
Less: Interest and Finance Charges 354 1,109 1,324
PBT 961 1,388 110
Share of Profit from Associate Company - 11 -
Taxes 339 182 92
PAT 622 1,217 18
Diluted EPS (Rs.) 13.16 24.94 0.32
Key Ratios FY07 FY08 FY09
EBITDA Margin 13.2% 17.9% 9.7%
EBIT Margin 10.9% 14.6% 6.5%
PBT Margin 9.43% 10.30% 0.60%
PAT Margin 6.1% 9.1% 0.1%
Debt / Equity* 2.71 1.63 2.14
* Post CCD conversion
18

Market Information
Shareholding Pattern (Aug 09)
Bodies
Corporate
13%
Mutual
Funds
2%
India EP
Fund
4% CVC
11%
Others
11%
Market Data (as at 26 Aug 09)
Share Price Rs. 220.80
Market Capitalization* Rs. 12,250m
Enterprise Value Rs. 27,411m
EV/ FY09 Sales 1.60
EV / FY09 EBITDA 16.6
Post conversion of CCDs
Promoters
59%
Share price performance over last 2 years
Share Price
700
600
500
400
300
200
100
0
Oct 07 -
Company
acquires NIPL
Feb 08 - Company
issues 84m zero
coupon CCDs to CVC
and India Equity
partners at Rs. 326.9
Aug 08 - Company
signs MoA with
Government of
Chhattisgarh for
setting up an
integrated steel plant
Sep-08 – Crash of
Lehman Brothers
leading to global
collapse
Jul 09 - Allotted 84m
shares to CVC and
India Equity Partners
pursuant to
conversion of CCDs
Jul 09 - Receives
shareholder approval
for raising US$ 100m
from QIB
Aug-07
Sep-07
Oct-07
Nov-07
Dec-07
Jan-08
Feb-08
Mar-08
Apr-08
May-08
Jun-08
Jul-08
Aug-08
Sep-08
Oct-08
Nov-08
Dec-08
Jan-09
Feb-09
Mar-09
Apr-09
May-09
Jun-09
Jul-09
Aug-09
450,000
400,000
350,000
300,000
250,000
200,000
150,000
100,000
50,000
0
Volume
19

APPENDIX

Sales and Distribution
Marketing team of 15 people
Products are primarily sold in the domestic market through short term contracts
Large volume purchasers buy directly from the Company whereas low volume purchasers buy through stockholders and 3 consignment agents
Markets for the metallic, semi-finished and ferro alloy products are usually located within a 50 kilometre radius of our manufacturing facilities, which enables
significant savings in transportation cost
TMT Bars
Pig Iron
Sponge Iron
Billets
Ferro Alloy
Distribution Strategy Target Customers
Sold under the “Balaji Shakti” Thermex TMT Bars
Sold through 3 consignment agents
Sold through dealer network in local market and northern region (Punjab,
Haryana and UP)
Primarily Captive Usage
Sold directly to local customers within a 50 KM radius
Command a Rs. 200-300 premium for superior quality and reliability
Primarily captive usage
Some exported through Trade Houses, when realizations are better
Exported through big house traders and merchant exporters
Conversion agents for some of the large steel companies
Government Agencies
Power Projects and Industry Houses
Major civil contractors
Major real estate developers
Retail rural market
Secondary steel players at present
In future, it will be completely for captive use
Surplus to small non-integrated steel manufacturers
Surplus to Rolling Mills
Major steel companies
Some captive usage
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