         • production in has increased at a CAGR of 7.9 per cent over FY2009–14 to Fourth-largest producer 81.54 million tonnes per annum (MTPA). The country is slated to become the second- of crude steel largest steel producer by 2016, as large public and private sector players strengthen steel production capacity in view of rising demand

• Huge scope for growth is offered by India’s comparatively low per capita steel Strong growth consumption and the expected rise in consumption due to increased infrastructure opportunities construction and the thriving automobile and railways sectors

Technological • Increased government and corporate sector focus on using innovative production advancements techniques for enhancing operational as well as financial performance is a positive

• Domestic players’ investments in expanding and upgrading manufacturing facilities are Rising domestic and expected to reduce reliance on imports. In addition, the entry of international players* international would provide benefits in terms of capital resources, technical knowhow and more investments competitive industry dynamics

Source: Ministry of Steel

2011 GrowingRobust demanddemand Increasing investments 2016E • Demand would be supported by • To achieve steel capacity build-up Market growth in the domestic market of 300 million tonnes per annum Market (MTPA) by 2025, India would need value: • Infrastructure, oil & gas and value: to invest USD210 billion over the automotives would drive the USD95.3 USD57.8 next decade billion growth of the industry billion • 301 MoUs have been signed with various states for planned capacity of about 486.7 MT Advantage India Competitive advantage Policy support

• India is the world’s fourth-largest • 100 per cent FDI through the producer of crude steel (up from automatic route is allowed eighth in 2003); the country is • Large infrastructure projects in the expected to become the second- Public-Private Partnership (PPP) largest producer of steel by 2016 mode are being formed • Easy availability of low-cost • National Steel Policy (NSP) manpower and presence of implemented to encourage the abundant iron ore reserves make industry to reach global benchmarks India competitive in the global set up

Notes: FDI - Foreign Direct Investment, MT - Million Tonnes, MoUs - Memorandum of Understanding, 2016E - Estimated figure for the year 2016; These estimates are from Data monitor

1993–2012

1973–1992

1954–1964

• Foreign players • Reduction in basic 1923–1948 • SAIL was began entering the custom duty on the created in 1973 Indian steel market plants and • Hindustan Steel as a holding • No license equipments Ltd and Bokaro company to requirement for required for initial Steel Ltd were oversee most of capacity creation set up or expansion 1907–1918 • Mysore Iron setup in 1954 and India's iron and of iron ore pellet and Steel • Imposition of export 1964, respectively steel production plants & iron ore Company was duty on iron ore, to beneficiation plants, set up in 1923 • In the early 1990s, • In 1989, SAIL focus more on the public sector acquired catering growing to encourage • According to • Production dominated steel Vivesvata Iron beneficiation and the new domestic demand of steel production and Steel Ltd pelletisation of iron started in Industrial Policy • Decontrol of • Private players • In 1993, the ore fines in the India (TISCO Statement domestic steel were in government set country was setup in (1948), new prices downstream plans in motion 1907) ventures were • Launch of Scheme only production mainly to partially for promotion of • IISC was set producing finished privatise SAIL up in 1918 to undertaken by Research and the central steel using crude Development in compete steel products with TISCO government Iron & Steel sector

Notes: TISCO - Tata Iron and Steel Company; IISC - Indian Iron & Steel Company; SAIL - Ltd Steel

Form Composition End use

Liquid steel Crude steel Finished steel Non-alloy Structural Alloy steel steel

Low carbon Construction Stainless steel steel Ingots Flat

Silicon Medium Rail steel electrical carbon steel Semis Non-flat

High carbon Source: Report on Indian steel steel industry by Competition Commission High speed of India, Aranca Research Total crude steel production rose at a CAGR of 7.9 per cent over the last five years to reach 81.54 MT in FY14

Finished steel production increased 4.1 per cent to 85.0 MT in FY14; analysts expect production figures to improve rapidly over the next five years, with the Ministry of Steel forecasting production levels at 115.3 MT by FY17

Total crude steel production (million tonnes) Total finished steel production (million tonnes)

53.7 57.3 49.1 55.4 61.0 42.1 47.6 45.8 44.5 47.3

16.4 16.7 17.0 16.5 12.5 12.7 13.0 13.2 12.4 9.4 FY09 FY10 FY11** FY12* FY13* FY09 FY10 FY11 FY12* FY13*

Public sector Private sector Public sector Private sector

Source: Ministry of Steel, Aranca Research; Notes: FY - Indian Financial Year (April – March); MT - Million Tonnes, * - Provisional; ** Revised Figures; CAGR - Compound Annual Growth Rate; FY13* (Data from Apr-Dec) SAIL is the leader in India’s steel sector; in FY14, the company accounted for 12.6 per cent of the country’s finished steel production

Tata Steel, another household name in the country, leads private sector activity in the steel sector. During 2014, the firm accounted for 9 per cent of finished steel production

India crude steel market share by production India finished steel market share by production – FY13* (Apr–Dec) – FY14

10.0% 8.9% 3.3% Tata Steel 4.1%

12.6% RINL RINL 17.3%

SAIL SAIL

68.6% Other 75.2% Other

Source: JPC India Steel, Ministry of Steel, Aranca Research; Notes: RINL - Limited, * - Provisional In 2011, the Indian steel sector’s total market value was Market value of the Indian steel sector USD57.8 billion (USD billion)

The sector has benefitted from hike in prices and 120 production, especially since the beginning of the 100 95.3 millennium 80 Over 2007–11, the sector’s market value is estimated to CAGR: 17.7% 57.8 have posted a strong CAGR of 17.7 per cent 60 46.8 43 36.5 40 30.1

20

0 2007 2008 2009 2010 2011 2016E

Source: Datamonitor, Aranca Research Note: E - Estimates Total consumption of steel grew to 73.9 MT in FY14 against Real consumption of steel (in million tonnes) 73.5 MT in FY13; over FY08–14, consumption has expanded at a CAGR of 6 per cent 80 73.9 CAGR: 6% 70.92 73.5 70 66.42 Driven by rising infrastructure development and growing 59.34 60 demand for automotives, steel consumption is expected to 52.13 52.35 grow at an average rate of 6.8 per cent, reaching 104 MT by 50 2017 40

30

20

10

0 FY08 FY09 FY10 FY11 FY12 FY13 FY14

Source: JPC India Steel, Ministry of Steel, Aranca Research Note: MT - Million Tonnes With growth in demand for steel outpacing growth in Steel exports and imports (in million tonnes) domestic production over the last few years, import dependency has increased 9.0 8.0 Imports have decreased from 7.9 mtpa during FY13 7.0 to about 5.4 mtpa in FY14 due to increase in the 6.0 country’s production capacity 5.0 4.0 Total domestic demand for steel estimated at 113.3 mtpa by 3.0 2016-17 2.0 1.0 0.0 FY08 FY09 FY10 FY11** FY12 FY13 FY14

Imports Exports

Source: Ministry of Steel, JSPL presentation, Aranca Research Notes: FY - Indian Financial Year (April - March), E – Estimates, * - Provisional, ** - Revised Figures, FY13* (Apr-Dec 2012) Infrastructure is India’s largest steel consumer, accounting Sector-wise steel consumption FY12 for 63 per cent of total consumption in FY11

2% This is not surprising given the heavy use of steel in 3% Infrastructure this sector and soaring construction and 10% infrastructure activity in the country over the past Engineering and decade fabrication

Autos Engineering and fabrication is the next largest consumer, 22% with 22 per cent of total consumption 63% Packaging

Transportation

Source: JSPL May 2013 presentation, Aranca Research Company Products

Tata Steel Ltd Finished steel (non-alloy steel)

SAIL Finished steel (non-alloy steel)

JSW Steel Ltd Hot-rolled coils, strips and sheets

Jindal Steel & Power Ltd Iron and steel

Ispat Industries Ltd Hot-rolled coils, strips and sheets

Welspun-Gujarat Stahl Rohren Ltd Tubes and pipes

Bhushan Steel Ltd Cold-rolled coils, strips and sheets

Carbon, Alloy, Stainless and Facor Steel Ltd Special steel

Source: Aranca Research • SAIL has modernised and expanded its integrated steel plants in Bhilai, Bokaro, Rourkela, Durgapur, Burnpur and Salem Growing investments • The company has expanded its crude steel production capacity to 21.4 MTPA in 2013 • Completed mega expansion of Rashtriya Ispat Nigam Limited (RINL) to more than double capacity of plant (from 2.9 MT to 6.3 MT) from 2013-14

• International Coal Ventures Pvt Ltd, comprising SAIL, RINL, CIL, NTPC and NMDC, has been set up for acquisition of coal mines overseas • The consortium of SAIL and National Fertiliser Limited (NFL) has been nominated for Strategic alliances revival of Sindri Unit of the Fertiliser Corporation of India Limited • RINL, Vishakhapatnam Steel Plant and the Power Grid Corporation of India Ltd (POWERGRID) signed an MoU to set up a joint venture company to manufacture transmission line towers and tower parts including R&D of new high-end products

• Attracted by the growth potential of the Indian steel industry, several global steel players have been planning to enter the market Entry of international • National Mineral Development Corporation (NMDC) has signed an MoU with Russia’s companies third-largest steelmaker, Severstal, for a greenfield steel plant in Karnataka • Posco Steel to invest USD12 billion in setting up a 12 MT project in India

Source: Ministry of Railways, Aranca Research Notes: MOUs - Memorandum of Understanding, MT - Million Tonnes • Indian steel companies have now started benchmarking their facilities and processes against global standards, to enhance productivity • These steps are expected to help Indian companies improve raw material and energy consumption as well as improve compliance with environmental and pollution yardsticks Increased emphasis on • Companies are attempting coal gasification and gas-based Direct-Reduced Iron (DRI) technological production. Other alternative technologies such as Hlsmelt, Finex and ITmk3 being innovations adopted to produce hot metal • Ministry of Steel has issued necessary direction to the steel companies to frame a strategy for taking up more R&D projects by spending at least 1 per cent of their sales turnover on R&D to facilitate technological innovations in the steel sector

Source: Aranca Research Steel integrated plants under SAIL (Bhilai, Rourkela, Bokaro, Durgapur and Burnpur)

Tata Steel’s largest steel plant, based in Jamshedpur

Alloy and special steel plants under SAIL (Bhadrawati and RINL steel plant in Salem); Iron and Steel Plant Vishakhapatnam at Visvesvaraya

Source: Company websites, Aranca Research

Competitive Rivalry

• The steel industry is highly concentrated, with the top five players accounting for more than 70 per cent of the market share • Price is generally market determined. Steel companies usually compete on the Threat of New basis of production capacity, economies of scale, access to raw material, etc. Entrants (Low)

Threat of New Entrants Substitute Products

• Capital intensive, industry players • Low threat of substitutes are large and enjoy economies of • Aluminium and plastics are being Bargaining Competitive Substitute scale. Some have their own mines used in few cases in automotive Power of Rivalry Products for sourcing key raw materials and other consumer durable Customers (Medium) (Low) • Several regulatory clearances sectors. However, it still does not required, including environmental, pose significant threat to steel (Medium) land acquisition, etc.

Bargaining Power of Suppliers Bargaining Power of Customers Bargaining Power of • Large integrated companies have • Major steel consumption sectors, Suppliers their own mines to source key raw such as automobiles, oil & gas, (Medium) materials shipping, consumer durables and power generation, enjoy high bargaining power and get favourable bulk deals. Smaller customers, however, do not enjoy this benefit

• Companies in the steel industry are investing heavily in expanding their capacity. Major public and private companies, including Tata Steel, SAIL and JSW Steel, are expanding their production capacity. Steel production is expected reach 200 mtpa by 2020 compared to 89 mtpa in 2013 • India is the fourth-largest steel producer in the world, and is expected to become the second largest by 2016 • The government has stepped up infrastructure spending from the current 5 per cent of GDP to Capacity expansion 10 per cent by 2017, and the country is committed to investing USD1 trillion in infrastructure during the 12th Five Year Plan. Considering 15 per cent as steel component in the total investment, the initiative has a potential to generate an additional demand for steel of 18.75mtpa • The Ministry of Steel is encouraging R&D activities by providing financial assistance from Steel Development Fund (SDF) and Plan Scheme of the Central Government. Furthermore, the government has allowed 100 per cent FDI through the automatic route in the Indian steel sector

• Steel companies are strengthening their position through cross border mergers and acquisitions. The focus is on improving existing technology to upgrade production process and developing new value added-products Mergers & Acquisition • Notable deals include Essar Global’s acquisition of Canada-based Alhoma Steel and Tata Steel’s part buyout of Corus. Tata Steel now intends to buy Millennium Steel PCL as a pert of its USD 23 billion expansion plan over the next 12–15 years

• In the last few years, rapid and stable growth in demand has also prompted domestic Greenfield projects – entrepreneurs to set up fresh greenfield projects in different states of the country. Mittal Steel focus on downstream announced two 12 mtpa greenfield steel projects, one each in Jharkhand and Orissa value-added products • As India surges ahead in building infrastructure, investments in steel pave the way ahead

Source: CCI, Ministry of External Affairs

Growing demand Policy support Increasing investments

Growing demand in Rising investments 100 per cent FDI in the construction from domestic and the steel sector industry foreign players Inviting Resulting in

Encouragement of Increasing number Growing demand in sector-based R&D of MoUs signed to the automotives activities by the boost investment in sector government steel

Reduced custom Foreign investment Rising demand for duty and other of nearly USD40 consumer durables favourable billion committed in and capital goods measures the steel sector

Note: FDI - Foreign Direct Investment Investment in infrastructure by the Planning Commission is Projected values of investment in infrastructure expected to expand at a CAGR of 14.5 per cent over FY12– (USD billion) 17

The Planning Commission expects total infrastructure investment to be USD1 trillion in the 12th Five-Year Plan 191.4 (2012–17), from USD428 billion in the 11th Five-Year Plan CAGR: 14.5% 169.0 149.1

This increase in infrastructure investment is set to raise 114.1 131.2 steel demand by roughly 18.75 mtpa 97.3

As per estimates, USD33.06 billion would be invested in the steel sector in the coming years*

FY12 FY13 FY14 FY15 FY16 FY17

Source: Planning Commission, Aranca Research Notes: MTPA - Million Tonnes Per Annum, *Tata Steel Over FY03–12, the consumer durables sector has expanded at a CAGR of 10.8 per cent as growth in disposable income resulted rise in their demand

The capital goods and consumer durables sectors are expected to grow at 7.5–8.8 per cent over 2012–21

Automotives production expanded at a CAGR of 16.7 per cent over FY09–13

Commercial vehicles is the fastest-growing segment, and expanded at a CAGR of 20 per cent over FY09–13

Over FY12–21, the automotive sector is projected to rise at a CAGR of 11.5–12.5 per cent Consumer durables market size (USD billion) Total automobile production in India (million units) 12.5 30.2

CAGR: 12.9% 7.3 7.3 21 6.3 16.6 5.2 14.2 16.3 11.1 9.7 3.8 4.2 4.7 8.9 2.9 3.2 3.5 5.1 1.8 2.4 3 3.1 3.2 2.4 0.4 0.6 0.8 0.9 0.8 1.4

FY09 FY10 FY11 FY12 FY13 FY16E FY21E FY03 FY04 FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY15E Passenger vehicles Commercial vehicles Three wheelers and two wheelers

Source: SIAM, JSPL May 2013 presentation, Corporate Catalyst India, Aranca Research Notes: E - Estimate; FY - Indian Financial Year (April - March) • In view of the sector’s changed dynamics, globally as well as domestically, the Ministry of Steel has initiated the process of drafting a new National Steel Policy to replace the existing National Steel Policy of 2005 • The government has set up a committee headed by the Steel Secretary to monitor the National Steel Policy formulation of the new National Steel Policy 2012 • Four task forces have been constituted to study, analyses, consult and formulate draft policy documents on different aspects of the policy • The current policy draft proposes allotment of captive iron ore mines to producers through open bidding and putting some mines in the general category

• A new scheme, ‘The scheme for the promotion of R&D in the iron and steel sector’, has been approved with budgetary provision of USD24.6 million to initiate and implement the provisions of the scheme as per the 11th Five-Year Plan R&D and innovation • USD14.9 million had been spent under the scheme up to September 2013 • The development of technology for Cold-Rolled Grain Oriented (CRGO) steel sheets and other value-added products is also included under the policy purview and is allocated USD6.7 million

Source: Ministry of Steel, Aranca Research Foreign Direct • 100 per cent FDI through the automatic route is allowed in the Indian steel sector Investment

• The government hiked the export duty on iron ore to 30 per cent ad valorem on all varieties of iron ore (except pellets). Rise in export duty • Export duty on chrome ore and concentrates has been enhanced to 30 per cent ad valorem

• The government has reduced the basic custom duty on the plants and equipments required for initial set up or expansion of iron ore pellets plants and iron ore beneficiation plants from 7.5/5 per cent to 2.5 per cent Reduction in custom • Customs duty on imported flat-rolled stainless steel products has been increased to 7.5 duty on plants & per cent from 5.0 per cent equipment • Basic customs duty on steel grade dolomite and steel grade limestone is being reduced from 5 per cent to 2.5 per cent • Basic customs duty is being reduced from 10 per cent to 5 per cent on forged steel rings used in the manufacture of bearings of wind-operated electricity generators

Source: Ministry of Steel, Aranca Research

• Export duty on iron ore has been increased to 30 • Under the Ministry, the Joint Plant Committee per cent ad valorem on all varieties of iron ore (JPC) studied 300 districts, 1,500 villages, 4,500 (except pellets), to preserve iron ore resources for manufactures and 8,000 retailers spread over domestic use India’s 28 states and 7 union territories to assess • As per the government’s decision, the Government steel demand in the rural areas and examine the of India’s 51 per cent shareholding in Eastern potential to increase steel consumption levels Investments Company Limited (EIL), under Bird • The Ministry of Steel set up the Steel Innovation Group of Companies, was transferred to RINL Council to promote innovative ideas in the steel • New Research and Development policy for the sector steel sector have been finalised/adopted for • The New National Steel Policy for the forthcoming implementation years is under finalisation • New techno-economic benchmarks have been • In April 2013, the Ministry of Steel signed a Letter evolved on international patterns to improve of Intent (LoI) with the Tanzanian Government to performance of steel PSUs; implementation is strengthen cooperation in steel and mining being monitored closely activities

Source: Ministry of Steel, Aranca Research Note: W.E.F - With Effect From 30th December, 2011 Developer Location Product

Stainless steel engineering Viraj Profiles Ltd Thane, products

Jindal Steel Ltd Kalinganagar Stainless steel

SAIL Salem SEZ Pvt Ltd Salem, Tamil Nadu Steel

Orissa Industrial Infrastructure Metallurgical-based engineering Jajpur, Orissa Development Corporation and ancillary/downstream industry

Source: “Formal approvals granted in the Board of Approvals after the SEZ rules coming into force”, Special Economic Zones in India website, www.sezindia.nic.in Date Value of deal Acquirer name Target name announced (USD million)

Apr-14 JSW Steel Ltd Vallabh Tinplate Pvt Ltd -

Mar-14 Lalitanjali Group Pvt Ltd Centom Industries Ltd -

Dec-13 Venus Insec Pvt Ltd Goodluck Steel Tubes Ltd 23.73

Oct-13 JSW Projects Ltd IST Steel & Power Ltd

Aug-13 Readymade Steel India Ltd Kridhan Infra Solutions Pvt

Jul-13 Swelect Energy Systems Ltd Amex Alloys Pvt Ltd

Apr-13 Metallurgica Siderfoge S.r.l AMW-MGM Forgings Pvt Ltd

Feb-13 Wayzata II Indian Ocean Ltd Ramkrishna Forgings Ltd 51.90

Nov-12 Rabale Engineering India Ltd Pradeep Metals Ltd 6.85

Nov-12 Suncoke Energy Inc Visa Steel Ltd-Coke division

Oct-12 Aum Saw Pipes & Industries Pvt Greenearth Resources 2.77

Source: Thomson ONE Banker, “Fact Sheet On Foreign Direct Investment (FDI)”, Department of Industrial Policy and Promotion Cumulative FDI inflows

Period: April 2000 to April 2014

Sector

Metallurgical industries USD8.1 billion

Per cent of total FDI inflow 4

Source: Thomson ONE Banker, “Fact Sheet On Foreign Direct Investment (FDI)”, Department of Industrial Policy and Promotion Crude steel capacity addition plans up to 2017-18 (in mtpa) Existing Brownfield Greenfield Total capacity Company capacity expansion expansion addition SAIL 12.84 21.40 5.60 27.00 RINL 2.90 7.00 - 7.00 NMDC - - 3.00 3.00 Tata Steel Limited 6.80 9.70 23.50 33.20 Limited 10.0 10.0 - 10.0 JSW Steel Limited 11.00 12.00 - 12.00 Jindal Steel & Power Limited 3.50 4.25 7.00 11.25 JSW Ispat Steel Limited 3.30 4.50 - 4.50 Bhushan Steel Limited 3.26 5.20 - 5.20 Bhushan Power & Steel Ltd 2.80 2.50 - 2.50 Monnet Ispat& Energy Ltd 0.30 1.50 3.50 5.00 Electrosteel Steel - - 2.51 2.51 Visa Steel Ltd 0.50 2.50 3.75 6.25

Source: Ministry of Steel, Annual Report 2012-13 Note: MTPA - Million Tonnes Per Annum For updated information, please visit www.ibef.org

Automotive Capital goods Infrastructure Airports

• The automotives • The capital goods • The government aims • More and more industry is forecasted sector accounts for to increase modern and private to grow in size by 11 per cent of steel infrastructure airports are expected USD122–159 billion consumption, and spending from 7.7 to be set up by 2016 has the potential to per cent of GDP in increase in tonnage FY14(P) to 10.7 per • Development of Tier- • With increasing and market share cent by FY17 II city airports would capacity addition in sustain consumption the automotive • Corporate India’s • Due to such a huge growth industry, demand for capex is expected to investment in steel from the sector grow and generate infrastructure the • Estimated steel is expected to be greater demand for demand for long steel consumption in robust steel products would airport building is increase in the years likely to grow more ahead than 20 per cent over next few years

Notes: Capex – Capital Expenditure, P - Provisional Railways Oil and gas Power Rural India

• The Dedicated Rail • The liquid fuel • The government aims • Rural India, Freight Corridor transportation pipeline to add 71,000– accounting for 70 per (DRFC) network network is likely to 107,500 MW (Mega cent of Indian expansion would be grow from the present Watt) of capacity population has low enhanced in future 16,800 km to 22,000 during the 12th Five- per capita steel km in 2014 Year Plan consumption which • Gauge conversion, provides huge scope setting up of new lines • This would lead to an • Both generation and for growth and electrification increase in demand of transmission would drive steel steel tubes and pipes, capacities would be • Policies like Bharat demand providing a lucrative enhanced, thereby Nirman and Rajiv opportunity to the raising steel demand Gandhi Awaaz Yojna steel industry from the sector are driving growing demand for construction steel in rural India

Source: Planning Commission, Aranca Research

Projected crude steel capacity in the 12th Plan Limited (million tonnes) Incorporated in 1979, Jindal Steel and Power Limited (JSPL) is an integrated steel producer and the largest coal-based sponge iron 11.5 manufacturer in the world. The company has an installed steel production capacity of 3 MTPA at Raigarh in Chhattisgarh. JSPL is 10.0 CAGR: 25.1% engaged in manufacturing long products and is specialised in 8.0 producing long rails for railways and large sized H-beams as well 7.0 as columns for the infrastructure and construction sector 4.5 JSPL also has significant presence across the mining, power 3.0 3.0 generation and infrastructure sectors New and expansion projects include setting up of a 7 MTPA integrated steel plant in Chhattisgarh, 12 MTPA integrated steel FY11 FY12 FY13 FY14 FY15 FY16 FY17 plant in Jharkhand and a 12.5 MTPA integrated steel plant in Orissa. Source: Company website (www.jindalsteelpower.com), • Achievements: Planning Commission, Aranca Research • 2011 – Ranked third in the Metals category of Business World’s Most Respected Companies Survey, 2011 • 2010 – Rated the World’s Second-Largest Value Creator by the Boston Consulting Group (BCG) and the World’s Largest Value Creator in the Mining and Materials category Sale of steel (million tonnes) Financial growth (USD million)

3,315 3,319 4.5 4.0 4.2 3,500 3.8 3,007 4.0 3,000 3.5 3.0 2.9 2,500 2,287 3.0 2.8 2.8 1,803 2.5 2.3 2.1 2.2 2,000 2.0 1.9 1,488 1,596 2.0 1.6 1.6 1,500 1.4 958 1.5 1.2 816 818 1.0 1,000 671 721 0.5 0.8 0.7 634 1.0 431 438 395 0.3 500 197 0.5 0.2 103 0.0 0 FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14

Finished steel products Semi-steel products Pellets Gross Revenues PBIDT

Source: Company website (www.jindalsteelpower.com) Notes: Company clubs iron and steel segment ‘s performance; PBIDT (Profit Before Interest, Depreciation and Tax) Strong diversified customer base of more than 1 lakh TMT Re-bars Expansion in international markets Wire rods Foray into the oil & gas and cement FY14-15 sectors as a part of Steel capacity to diversification rise from 4.5 Plate and coils mtpa to 7.5 mtpa

Organic growth FY08 through capacity Column sections ISO additions 9001:2008 accreditation Hot-rolled parallel The iron and steel flange beams 1991 segment continues Commenced to be a major operations contributor (~75%) Long track rails

1991 1993 1995 1997 1999 2002 2006 2010 2012 Projected crude steel capacity in the 12th Plan Bhushan Steel Limited (million tonnes) Established in 1983, Bhushan Steel Limited (BSL) is the third-largest secondary steel producer in India. The company 5.0 5.0 5.0 5.0 is headed towards an installed capacity of 7 MTPA (post 4.5 completion of Phase III; 4.7 MTPA of primary and 2.2 MTPA of secondary). It primarily manufactures flat steel products for the automobile industry 2.5 Products – Cold-rolled closed annealed coils, galvanised 2.2 coils and sheets, high tensile steel strapping, colour coated coils, galume sheets and coils, hardened and tempered steel strips, billets, sponge iron, precision tubes and wire rods

• Milestones: FY11 FY12 FY13 FY14 FY15 FY16 FY17 • 2004 – Commissioned secondary steel production at

Khapoli, Maharashtra Source: Company website (www.bhushansteel.com), • 2006 – Commissioned primary steel production at Planning Commission, Aranca Research Meramandali, Odisha • 2006 – Commissioned secondary steel production at Sahibabad, Uttar Pradesh Steel production (million tonnes) Financial growth (USD million)

2.5 2.4 2,500 2,251 2.1 2,173 2.0 2.0 1.8 2,000 1,662 1.6 1,539 1.5 1,500 1.2 1,266 1.1 1,161 1,178 1 928 1.0 1,000 693

0.5 500 221 213 105 178 167 35 69 92 10 0.0 0 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 Gross revenue

Source: Company website (www.bhushansteel.com), Aranca Research Note: NPAT - Net Profit After Tax Technological upgradation and Other further capacity developed products addition

Capacity Sponge iron Iron making and expansion castings (0.9 MT to 2.5 MT) FY14 USD1.5 billion Partnership with turnover Alloy billets Japanese steel Alloy steel producer, Sumitomo FY06 Organic growth in Color coated tiles Primary steel steel and flat Wheel, tyre and production in and pipes products axle plant (railways) Odisha

1989 Galvanised Secondary Strong diversified steel customer base of production in 3,300 customers UP Cold-rolled 1989 1991 1993 1995 1997 1999 2002 2006 2010 2012 Projected crude steel capacity in the 12th Plan Tata Steel Limited (million tonnes)

Established in 1907 by the visionary founder – JN Tata, Tata Steel is among the top ten global steel companies with an 20.0 annual crude steel capacity of over 28 MTPA 17.5 The company caters to sectors such as automotive, CAGR: 19.7% 15.1 construction, consumer goods, engineering, packaging, 11.0 energy & power, ship building, rail and defense & security 9.2 7.6 • Milestones: 6.8 • 2009 – Tata Ryerson and HMPCL merge with Tata Steel • 2007 – Tata Steel and Corus were integrated at FY11 FY12 FY13 FY14 FY15 FY16 FY17 USD12 billion, making Tata Steel one of the top ten global steel producers Source: Company website (www.tatasteel.com), Planning Commission, Aranca Research Production and sale of steel (million tonnes) Financial growth (USD billion)*

10.0 8.0 8.9 8.5 7.2 7.1 7.0 6.9 9.0 7.9 7.0 8.0 5.9 5.8 6.4 6.7 7.0 7.5 6.0 5.6 7.0 6.4 6.6 5.4 6.2 5.0 4.5 6.0 4.9 4.9 5.2 3.9 4.6 4.8 4.8 5.0 4.4 4.0 4.0 3.0 3.0 2.0 1.5 1.4 2.0 0.8 0.9 1.2 1.1 1.1 0.9 1.1 1.0 1.0 - - FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14

Production Sales Gross revenue NPAT

Source: Company website (www.tatasteel.com), Aranca Research Notes: NPAT - Net Profit After Tax *Financials reflect figures of Indian operations Developed products Technological upgradation

Iron making and Capacity castings expansion (3 MT) FY14 USD6.9 billion Alloy steel Diversification turnover* (coal injection unit) M&A Wheel, tyre and Organic growth in (Tata-Corus) axle plant (railways) steel Announced plans to merge Tata FY06 Metaliks Ltd and Tata Metaliks Pig iron and 1912 USD3,625 Kuboto Pipes Ltd steel ingots Production million with itself in April capacity (1.6 turnover 2013 lakh tonnes) Blast furnace 1912 1995 1996 1997 1998 1999 2000 2002 2004 2006 2008 2010 2011 2012 2013

Source: Company website (www.tatasteel.com), Aranca Research, * - Revenues from Indian operations Note: M&A - Mergers and Acquisitions Projected crude steel capacity in the 12th Plan JSW Steel (million tonnes) Established in 1994, JSW Steel Ltd manufactures iron and 18.4 steel products in India and abroad. The company has an CAGR: 8.8% 17.6 installed capacity of 14.3 million tonnes per annum, 14.3 14.3 14.3 Products – Hot-rolled coils, plates and sheets; cold-rolled 13.23 11.1 coils and sheets; galvanised sheets and coils, galvume; TMT bars, wire rods, cast products, pre-painted galvanised coils, sheets. • Achievements: • 2011 – National Sustainability Award by the Indian Institute of Metals FY11 FY12 FY13 FY14 FY15 FY16 FY17 • 2009 – Gold Award in the Metal and Mining sector • 2008 – National Energy Management Award instituted by CII Source: Company website (www.jsw.in), Planning Commission, Aranca Research Product group-wise sales (million tonnes) Financial growth (USD million)

8 6.9 7,221 7,137 7 5.9 6 5,228 4.7 4.7 5 4,053 3,806 4 3,162 2,631 3 1,937 1.5 1.7 2 1.1 1,417 269 421 419 0.9 360 339 332 1 96 0.3 0.4 0.3 0.1 178 -20 0 Semis Rolled Flat Rolled Long FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14*

FY11 FY12 FY13 FY14* Gross revenue NPAT

Source: Company website (www.jsw.in) Note: FY14* - Half year ended September 2013 Unaudited Figures Hot-rolled Capacity addition 7.8 MT

Cold-rolled JV formed to FY 13 explore, develop & USD7.1 mine iron ore with billion MML turnover Wire rods FY06 USD1,417 Organic growth million turnover TMT Re-bars and integration 1994 ISO FY 14 Galvanised accreditations Saleable steel 1994 sales to reach product Production 9.75 million capacity tonnes (1.25 MTPA) Special steel bars

1994 1995 1996 1997 1998 1999 2000 2002 2004 2006 2008 2010 2011 2012 2013

Notes: JV - Joint Venture, TMT - Thermo Mechanically Treated, MML - Mysore Minerals Limited, MTPA - Million Tonnes Per Annum

Indian Stainless Steel Development Association L-22/4, DLF Phase-II Gurgaon, Haryana –122 002 Phone: 91-124-4375501 Fax: 91-124-4375509 E-mail: [email protected] CAGR: Compound Annual Growth Rate

FDI: Foreign Direct Investment

FY: Indian Financial Year (April to March)

So FY10 implies April 2009 to March 2010

JV: Joint Venture

MoU: Memorandum of Understanding

MT: Million Tonnes

MTPA: Million Tonnes Per Annum

NPAT: Net Profit After Tax

SEZ: Special Economic Zone

TMT: Thermo Mechanically Treated

USD: US Dollar

Wherever applicable, numbers have been rounded off to the nearest whole number Exchange rates (Fiscal Year) Exchange rates (Calendar Year)

Year INR equivalent of one USD Year INR equivalent of one USD

2004–05 44.81 2005 43.98

2005–06 44.14 2006 45.18

2006–07 45.14 2007 41.34

2007–08 40.27 2008 43.62

2008–09 46.14 2009 48.42

2009–10 47.42 2010 45.72

2010–11 45.62 2011 46.85

2011–12 46.88 2012 53.46

2012–13 54.31 2013 58.44

2013–14 60.28 Q12014 61.58

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