CORPORATE PRESENTATION

1
CORPORATE PRESENTATION

• 9th November, 2004

2
Corporate Profile - Background
Established as Asahi India Safety Glass
Ltd. Commercial Production 14th March,
1987 Equity Structure Labroos 24
Asahi Glass Co. Ltd. 24 Maruti Udyog
Ltd. 12 Public 40 Initial Equity
Rs. 1.85 crores Products Automotive Safety
Glass
Initial equity increased to Rs. 7.40 crores
through two successive bonus issues made by the
Company.
3
Corporate Profile - Merger of Floatglass India
Ltd.

• In 2001, Asahi Glass Co., Japan decided to
  bring the India operations under one roof, by
  passing on control of Floatglass India Ltd. to
  AIS driven by the evidence of AISs
  performance. The formal takeover of Floatglass
  India Ltd. was completed in February 2002.
• Floatglass India Ltd. was subsequently merged
  into AIS.
• Post merger, the equity structure of AIS stands
  as under

Total equity currently stands at Rs. 8 crores, up
from the pre-merger level of Rs. 7.40 crores.
4
Corporate Profile Past Perspective
These figures contain, in brief, the story of
AISs growth from a supplier of automotive
tempered glass to Maruti Udyog (Suzuki) when we
began, to the current situation of Indias
largest glass company, with profitable growth
flowing from all the actions taken since the
birth of the organization.
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Corporate Profile Present

• AIS today is the largest glass company in
  India, manufacturing wide
• Range of international quality automotive safety
  glass and float glass. AIS
• has the following two operating business units
• - AIS (Automotive)
• - AIS (Float)
• AIS (Automotive), one of the two operating
  business units of AIS,
• is Indias largest manufacturer of world class
  automotive safety glass
• and is, in fact, one of the largest in the field
  in Asia.
• AIS (Float), the other operating business
  unit, is the leading
• manufacturer of international quality float
  glass.

AIS is in the process of transforming itself from
being a manufacturer of world- class products to
a solutions provider. AIS is now moving up the
exciting value chain of glass by providing
design, products and services that make glass
more versatile, more user friendly.
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Key Initiatives Achievements
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Value-creating growth - Creating shareholder value

• AISs growth plans are designed to create a
  stronger company and enhance shareholder value.
  Example
• - An investment of Rs. 1000 in equity
  shares of AIS at the time of the IPO in 1987 had
  grown over 500 times into a holding of Rs. 5
  lakhs.
• - The investment of Rs. 1000 in the IPO had
  generated dividends of Rs. 22,406 until 2003-04.
• - A holding of 100 equity shares of a face
  value of Rs.10 each had grown into a holding of
  4000 shares of a face value of Re. 1 each
  through bonus issues and a sub-division in the
  face value of the Companys equity shares.
• AIS has been guided by the financial goal of
  generating free cash flows from operations to
  earn a rate of return on capital employed (ROCE)
  of 40 per cent and to pay out 25 per cent of
  profits as dividends.

8
Business de-risking

• AISs transition from an automotive glass
  manufacturer supplying a single customer to
  becoming Indias largest glass company is
  reflective of its de-risking strategy. This has
  helped AIS
• - Improve competitive advantage
• - Expand business platform
• - Reduce business risk
• - Enhance strategic position
• AISs growth strategy is aimed at realizing the
  vision of becoming Indias leading integrated
  glass company, with a meaningful presence in
  every part of the automotive and architectural
  glass businesses leading to the eventual
  effective capture of value across the complete
  chain.

9
Quest for Excellence

• AIS has been benchmarking its operational
  performance to global levels and set out targets
  as milestones to achieve these levels. These
  targets are being challenged constantly.
• As a result, shop floor performance in AIS
  (Automotive), for example, is in line with the
  best in class benchmarks on following parameters
  
• - Shop floor yields, at over 96 per cent
• - Customer claims, within 100 ppm
• - machine uptime, in the range of 98 per cent
• Production in AIS (Float), the erstwhile
  Floatglass India Ltd., has gone up by over 37 per
  cent, compared to FY 2000-01 levels, the last
  year before the takeover. AIS (Float) achieved a
  record production of 31.36 million csqm. in FY
  03-04, against the rated capacity of 29.2
  million.

10
Pioneering initiatives in India

• AIS is credited with the following initiatives in
  India
• - First to introduce laminated safety glass
• - First to manufacture printed glass
• - First to introduce modular assembly window
• - First to make complex shaped glass
• - First to introduce tinted float glass

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Value through world-class quality

• AIS is the first Indian glass company to be
  credited with
• - ISO 9002, QS 9000 and TS 16949
  certifications for the
• production and servicing of automotive
  safety glass.
• - ECEs E Mark and US Department of
  Transportations
• approval for its range of automotive safety
  glass.
• AIS has been following holistic
  systems-centric quality discipline
• under the umbrella of Total Quality Management.
• All the improvements and efforts at
  raising efficiency over the
• last five years have been carried out under the
  umbrella of TQM
• which has been spread through all processes in
  the company.

12
Technology Development

• A key strategic initiative at AIS has
  been in the area of building
• relevant self sufficiency in technology.
• AIS (Automotive) is fully equipped with
  CMM, CAD and a CNC Milling station, which
  provides self sufficiency in the area of product
  development. At AIS, we have gone beyond this
  into the area of developing and building glass
  processing equipment. Example
• AIS (Automotive) has developed its own CNC
  lines for the pre-processing of glass (cutting to
  shape, edging and washing) at 1/6th the import
  cost. The resultant automation implies a raise in
  manpower productivity cost effectively.

13
Strong Market Position

• AIS (Automotive) is the sole glass supplier to
  almost the entire Indian passenger car industry,
  with current market share of over 90 of
  automotive glass sales to OEMs. Building
  presence in the after market has been a key
  element of the strategy to diversify sales. AIS
  currently enjoys a market share of 55 in terms
  of value.
• Sales of automotive safety glass are made
  directly to OEM customers and through two
  nation-wide distributors, with 27 depots, to the
  direct after market, covering the length and
  breadth of the country.
• AIS (Float) enjoys a market share of
  approximately 25 of the Indian float glass
  market.
• Sales of float glass are made through a network
  of over 320 authorized stockists into the retail
  market spread across the country and serviced
  through its zonal offices.
• AIS (Float) has been conferred with the
  Certificate of Recognition by CAPEXIL in
  recognition of outstanding export performance.

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World-class Manufacturing Facilities

• AIS (Automotive) is Indias largest manufacturer
  of world class automotive safety glass and is, in
  fact, one of the largest in its field in Asia.
• State-of-the-art automotive glass manufacturing
  facilities, with a total production capacity of
  1.2 million car sets located at Bawal, District
  Rewari (Haryana).
• First Indian glass company to get the QS 9000,
  ISO 9002, ISO 14001 and TS 16949 by TUS
  SUDDEUTSCHLAND, ECEs E Mark and US Department
  of Transportations approval for its entire
  product range of automotive safety glass.
• Own power generation facilities to ensure
  uninterrupted supply of quality power.
• AIS (Float) has a state-of-the-art float glass
  manufacturing plant at Taloja near Mumbai, with
  installed production capacity of 500 MT / day,
  the third largest in the country. The plant is
  ISO 9001 certified by TUV Bayern Sachsen.

15
Well Balanced Product Portfolio

• AIS (Automotive) has the ability to address
  customer requirements of the full range of
  technologically advanced products in the
  automotive safety glass field.
• Present product range includes laminated
  windshields, tempered glass for side and back
  lites, zone tempered glass for windshields,
  silver printed defogger glass, black ceramic
  printed flush fitting glass and PVC-encapsulated
  fixed glass.
• AIS (Float) offers a diversified product range of
  international quality float glass of thickness of
  2mm 12mm, in different shades and tints of
  clear, green, grey and bronze and in varying
  sizes.
• Product portfolio of AIS (Float) now includes
  world class STOPSOL range of international
  quality heat-reflective glass and worlds finest
  quality copper free and corrosion resistant MNG
  mirrors.

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• AIS FINANCIALS - H1FY05

17
Financials

• Highlights - H1FY05
• Gross Sales and Net Sales increased 20 and 27
  to Rs. 331.41 crores and Rs. 284.61
  crores respectively
• Operating profit increased 9 to Rs. 64.41
  crore
• Operating margin (PBDIT / Net Sales)
  declined 3 to 23
• Cash profit up 10 to Rs. 63.73 crores
• Profit after tax declined 3 to Rs. 32.80
  crores
• Declared an interim dividend _at_ Re. 1/- (100
  on par value of Re. 1/-) on equity shares

18
Financials

• Highlights - H1FY05 (Continued)
• ROCE (PBDIT / ACE) and RONW recorded at 29 and
  44
• Total debt / equity and interest bearing
  debt / equity stand at 1.92 and 0.43
  respectively
• Financial coverage (PBIT / Interest)
  stands at 39
• CEPS and EPS at Rs. 8 and Rs. 4

19
Financials

• Highlights - H1FY05 (Continued)
• Profitability has been impacted due to higher
  input costs, as below, which are one-time /
  non-recurring. Total impact in H1 FY05 has been
  approximately Rs. 12 crores
• - Increase in power generation cost
• - Increase in freight cost, mainly due to
  premium freighting to ensure uninterrupted
  supplies for our OEM customers
• - Increase in cost of colourants and raw
  materials
• - Increase in overheads, largely relating to
  advertising / brand building

20
AIS - Financial Results
21
AIS - Financial Results
22
AIS - Segment Results
23
AIS - AUTOMOTIVE
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AIS - Automotive

• Highlights - H1FY05
• Sales up by 23 to Rs. 156.82 crores
• Segment Profit (EBIT) increased 29 to Rs. 28.38
  crores
• Segment Margin marginally up at 18

25
Vehicle Production for April - Sep
Car Exports 61128 in 2004 32507 in 2003
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Vehicle Production Annual
27
AIS - FLOAT
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AIS - Float

• Highlights - H1FY05
• Sales up by 19.5 to Rs. 133.50 crores
• Segment Profit increased 18 to Rs. 13.22 crores
• Segment Margin maintained at 10

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INDIAN FLAT GLASS SALES IN 2004-05
Despatches in August 2004 were adversely impacted
on account of a truckers strike towards the end
of the month.
30
FLOAT
Sales Production Qty
Increase in Sales Qty by 18 over last year
Increase in Production Qty by 6 over last year
31
Market Breakup
32
Zone wise Domestic Sales
33
Sales by Thickness Colour
34
Monthly Realization Rs per CSQM ( Net of excise
and Price difference)
35
Share of Business - Float
36
Looking Forward
37
AIS Group Vision
To be India's leading integrated glass company
AUTOMOTIVE GLASS VALUE CHAIN
Automotive glass manufacture (AIS Auto)
Allied Products distribution (eg.
sealants) (AWAGS)
Auto Glass Fitment Services
Automotive Glass distribution (AIM)
Third Party tie ups, eg. Windshield Experts
(GREEN cells indicate our existing spread of
activities and BLUE cells indicate the areas
where work has already commenced in line with
plans announced earlier)
Float Glass manufacture (AIS Float)
Value Added Products Reflective Mirror
Processing Laminated Tempered Insulated
Glass Products
Installation
Fabrication
AIS Glass Solutions Ltd.
Servicing Distributed Markets
Being considered along with 2nd float and/or at
Taloja during hot/cold repair
VALUE ADDED GLASS SOLUTIONS CHAIN
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Capturing value chain presence

• In the automotive glass business, AIS already
  has a value chain presence, reaching out to end
  consumer. Second automotive plant coming
• up in Chennai, with initial capacity of 500,000
  windshields, will have a
• capacity of 1.50 million laminated windshields
  and 1.0 million tempered car sets, after being
  fully set up.
• In the architectural glass business, AIS has
  initiated steps to capture the value chain,
  through its subsidiary AIS Glass Solutions,
  with the setting up of architectural glass
  processing facility at Taloja, to address
• the following segments
• - Architectural processing glass products
• - Product and knowledge development
• - Glass Services
• - Sales Marketing
• Second float glass plant, with production
  capacity of 700 MT / day being set up in the
  State of Uttranchal.

39
EXPANSION BRIEF HIGHLIGHTS
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2ND AUTOMOTIVE GLASS PLANT - CHENNAI

• Asahi Indias laminated plant at Bawal, with a
  capacity to manufacture 1.2 million windshields,
  is currently operating at full capacity.
• With most of the new capacity having been
  established by majors like Hyundai, Toyota and
  Ford in South India, the second automotive glass
  plant is being set up in Chennai in South India.
  Car production in this area is expected to rise
  from the current level of 220K to over 470K in
  next five years
• Besides proximity to key customers, Chennai is a
  Port city, thus allowing cost reduction in import
  of raw material (such as PVB) as well as in
  possible future exports.
• In Phase 1, only laminated plant to be
  established in Chennai with capacity of 500,000
  windshields. Plan for raising laminated capacity
  to 1.5 million windshields to be decided later,
  depending on overall demand situation.

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2ND AUTOMOTIVE GLASS PLANT - CHENNAI

• Commercial production of laminated windshields
  (Phase I) commencing from November, 2004. Capex
  for Phase I planned at Rs. 56 crores. Phase- I
  completed, on cost and time.
• Plant to be set up in modular fashion i.e.
  ability to take capacity up to 1.50 million
  windshields with some de-bottlenecking and
  additional investment.
• Plan to invest in Chennai for tempered capacity
  in Phase II during 2005-06.
• Once fully set up, new facility in Chennai
  planned at capacity of 1.50 million laminated
  windshields and 1.0 million tempered car sets.
• Chennai facility to include Value Addition
  capability (Assemblies, Add-ons) as required.

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AIS GLASS SOLUTIONS THE CONCEPT

• An exercise in value addition
• 5 year objectives
• Consume 6000 tons of float glass per month
• Raise glass consumption in the country from the
  current level of 0.55 kg per capita by
  introducing innovative product lines, including
• A line of bath enclosures.
• Standard line of glass shelving.
• Line of specialty laminated glass called
  Frontage for burglar-resistance, energy saving
  and sound proofing applications.
• A line of manufactured windows.
• Establish dominant presence through the value
  chain, including through processed glass as well
  as down stream through Glass Services to provide
  a one stop shop to consumers.
• Make AIS the No. 1 glass brand in India

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AIS GLASS SOLUTIONS AN INTRODUCTION
Forms of AIS Glass Solutions
AIS Glass Solutions
44
AIS GLASS SOLUTIONS PRODUCTS AND SERVICES

• Processed glass for architectural applications
• Laminated glass
• Tempered glass
• Insulated glass units
• Product lines, starting with bath enclosure line
• Glass installation service for low volume,
  high-value jobs in top 8 urban centres
  distributed markets.

45
ARCHITECTURAL PROCESSING

• Market size estimated to be Rs. 140 crores in
  2002-03.
• Total glass consumption in 2002-03 estimated to
  be 21,500 tons (1792 tons/month).
• Currently growing at 25.3.
• Our estimates show that this growth should ramp
  up to 34.1 CAGR over 5 years.
• At these rates, architectural processing will
  still account for about 11 of total flat glass
  consumed in the country up from 4 today. To
  put this in perspective, architectural processing
  consumed 45.3 of the flat glass produced in USA
  in 2002.

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ARCHITECTURAL PROCESSING

• AIS plan
• One integrated plant with tempered, laminated and
  insulated glass at Taloja, near current float
  plant in 2004-05. Unit to commence from
  January, 2005.
• Additional tempering lines in Chennai (April /
  May, 2005) and North India (2007-08).
• Lamination and IG demand can be serviced from
  planned Taloja facility in this five year period.
• Total planned capital expenditure for
  integrated facility at Taloja to cost
  approximately Rs. 20 crores.

47
2ND FLOAT GLASS PLANT

• The Board in its meeting held on 30th October,
  2004 approved, in principle, setting up of second
  float glass plant in the State of Uttranchal.
  The facility will have a production capacity of
  700 MT / day.
• Final cost and time schedule to be finalized and
  approved by the Board shortly, by end November,
  2004.
• Location of the second float plant finalized,
  considering the following factors
• Closeness to market.
• This will be the first float plant in North
  India, which is the largest market in the
  country, with approximately 38 of total market.
• Closeness to raw material
• Availability of tax incentives explained in
  some more detail in the following slide.

48
2ND FLOAT GLASS PLANT TAX INCENTIVES

• Three States in India (Uttranchal, Himachal
  Pradesh Jammu Kashmir) are offering
  substantial tax incentives, as described below
• a) No Excise Duty for 10 years. Excise Duty is
  currently levied at an ad valorem rate of 16 of
  the ex factory selling price.
• b) 100 Income Tax exemption for 5 years followed
  by 30 Income Tax
• exemption for the subsequent five years.

Uttranchal offers the tax incentives as described
and is selected for AIS second float plant
considering the locational advantages and the
tax benefits.
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LOCATIONALLY..

• Roorkee
• Planned
• Float
• Glass Solutions
• Auto (laminated) for after market.

• Rewari
• Current
• Auto
• Future
• 1. Glass Solutions?

• Taloja
• Current
• Float
• Future
• Glass Solutions

• Chennai
• Planned
• Auto
• Glass Solutions

50
FIFTEEN YEAR PERSPECTIVE..

• FLOAT
• Even at an average growth of 10, from the
  current levels,
• the Indian float market would grow to 5650 tpd
  in 15 years.
• From the current three float plants, the
  country would require about
• 15. Even assuming a share of 1/3rd, AIS would
  need 5 float
• plants.
• AUTOMOTIVE
• Even at an average growth of 10, Indias car
  production should rise to
• over 3 million units in fifteen years.
• OVERALL, India should be amongst the largest
  glass markets in the
• world.

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GUIDING PRINCIPLES All actions of AIS
are driven by the following guiding principles
1. Creation of Value for Shareholders 2.
Customer satisfaction 3. Respect for the
Environment 4. Use of facts 5. Continuous
Improvement 6. Strengthening of
Systems 7. Upgradation of human potential by
education and training 8. Social Consciousness