National Limited

Corporate Presentation July 2013 DISCLAIMER

This presentation is prepared by National Fertilizers Limited (the “Company” or “NFL”) for general information purposes only, without regard to specific objectives, suitability, financial situations and needs of any particular person and does not constitute any recommendation or form part of any offer or invitation or inducement to sell or issue, or any solicitation of any offer to purchase or subscribe for, any securities of the Company, nor shall it or any part of it or the fact of its distribution form the basis of, or be relied on in connection with, any contract or commitment thereof. This presentation does not solicit any action based on the material contained herein. Nothing in this presentation is intended by the Company to be construed as legal, accounting or tax advice. This presentation has been prepared by the Company based upon information available in the public domain and its internal estimates. This presentation has not been approved and will not or may not be reviewed or approved by any statutory or regulatory authority in or by any Stock Exchange in India. This presentation may include statements which may constitute forward-looking statements. The actual results could differ materially from those projected in any such forward-looking statements because of various factors. The Company assumes no responsibility to publicly amend, modify or revise any forward-looking statements, on the basis of any subsequent developments, information or events, or otherwise. The information contained in these materials has not been independently verified. 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The forward-looking statements, including those cited from third party sources, contained in this Presentation are based on numerous assumptions and are uncertain and subject to risks. A multitude of factors including, but not limited to, changes in demand, competition and technology, can cause actual events, performance or results to differ significantly from any anticipated development. Neither the Company nor its affiliates or advisors or representatives nor any of its or their parent or subsidiary undertakings or any such person's officers or employees guarantees that the assumptions underlying such forward-looking statements are free from errors nor does either accept any responsibility for the future accuracy of the forward-looking statements contained in this Presentation or the actual occurrence of the forecasted developments. Forward-looking statements speak only as of the date of this presentation. As a result, the Company expressly disclaims any obligation or undertaking to release any update or revisions to any forward-looking statements in this presentation as a result of any change in expectations or any change in events, conditions, assumptions or circumstances on which these forward looking statements are based. This presentation is not an offer to sell or a solicitation of any offer to buy the securities of the Company in the United States or in any other jurisdiction where such offer or sale would be unlawful. Securities may not be offered, sold, resold, pledged, delivered, distributed or transferred, directly or indirectly, into or within the United States absent registration under the Securities Act, except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and in compliance with any applicable securities laws of any state or other jurisdiction of the United States. The Company’s securities have not been and will not be registered under the Securities Act. The Company’s financial year ends on March 31.

National Fertilizers Limited 2 TABLE OF CONTENTS

1 Indian Scenario

2 National Fertilizers Limited

3 Corporate Social Responsibility

4 Appendix

National Fertilizers Limited 3 TABLE OF CONTENTS

1 Indian Fertilizer Scenario

2 National Fertilizers Limited

3 Corporate Social Responsibility

4 Appendix

National Fertilizers Limited 4 INDIAN FERTILIZER SCENARIO

Fertilizer product demand & production in India (mn MT) Share of fertilizers to total dispatches – 2011-12

Urea Diammonium Phosphate Complex NP – Nitro phosphate NPK – Nitro Phosphate & Potash DAP - Diammonium Phosphate 11 11 10 SSP – Single superphosphate 30 10 28 9 9 NP/NPK, 20% 26 26 9 MOP - Muriate of Potash 8 SOP - Sulphate of Potash 22 22 21 9 9 , 48.40% AS – Ammonium Sulphate 19 8 DAP, 18% CAN – Calcium ammonium nitrate 7 ACI – Ammonium chloride 4 4 3 3

SSP, 7.50% SOP, 0.10% FY 09 FY 10 FY 11 FY 12 FY 09 FY 10 FY 11 FY 12 FY 09 FY 10 FY 11 FY 12 AS/CAN/ACI, MOP, 5% 1.10% Demand Prodn. Demand Prodn. Demand Prodn. Source: Fertiliser Statistics 2011-12, The Fertiliser Association of India Source: Fertiliser Statistics 2011-12, The Fertiliser Association of India Fertilizer demand forecasts: 2013-14 to 2020-21 in India (mn MT) Global Production & Consumption – 2010 (mn MT)

Nitrogen Phosphate

36 17

33

40.3

34.8 33.8

32.6 12 9

17 8

12 12

15.8

13.6 4

13.1

12.6 8

12.1 4

11.4

4

5.7 4.1 6.1 4.3 6.4 5.2 8.3

10.4 10.9

2013-14 2014-15 2015-16 2020-21 China India USA China India USA

Urea DAP SSP MOP NPK Production Consumption Production Consumption

Source: The Fertiliser Association of India Source: Fertiliser Statistics 2011-12, The Fertiliser Association of India The entire requirement of Potash in the country is met through imports

National Fertilizers Limited 5 COMPETITIVE LANDSCAPE

Major players producing Urea in India

Company Urea Capacity* (mn tonnes) Other Products

NPK, Diammonium Phosphate (DAP), IFFCO 4.24 Phosphates, Complex

NFL 3.57 Bio-Fertilizers, Nitric Acid, Ammonium Nitrate

KRIBHCO 2.59 ----

RCF 2.33 NP, NPK, Ammonium Nitrate Phosphate

Chambal Fertilizers & Chemicals Ltd. 1.73 ----

Nagarjuna Fertilizers & Chemicals Ltd. 1.52 ----

*Urea capacity for NFL is as of March 31, 2013 and for others it is as in November 2012 NPK – Nitro phosphate and Potassic fertilizers Source: Fertiliser Statistics 2011-12, The Fertiliser Association of India

National Fertilizers Limited 6 EXISTING POLICY FRAMEWORK

Extant Government policies governing Fertilizer industry in India for existing capacities

Product Policy in effect Type Effect on Pricing & Subsidy

New Pricing Scheme (NPS) in place since A group pricing model based on • Government controlled pricing Urea 2003. Currently NPS-III which is being vintage and feedstock of Urea • Variable subsidy continuously extended 2010 onwards manufacturing plants in India

No Government Policy governing Bio- • Market driven Bio-Fertilizers fertilizers sales as such with pricing being - • No subsidy market driven

No Government Policy governing Industrial • Market driven Industrial Products product sales as such with pricing being - • No subsidy market driven

National Fertilizers Limited 7 NEW UREA INVESTMENT POLICY - 2012

New Urea Investment policy governing Urea producers in India for new capacities Product Pricing linked to Import Parity Price(IPP) of Urea

Parameter Old Policy – 2008 New Policy – 2012

• Floating Floor-Cap till gas price is US$14/mmbtu. • Any increase in gas price after that will warrant a change in the floor i.e. floating floor Urea Prices - Floor & Fixed Floor – Cap Price of • Base Price Cap US$250-425/MT − Brownfield: US$285-310/MT (at gas price of US$6.5/mmbtu) (IPP) − Greenfield/Revival: US$305-335/MT (at gas price of US$6.5/mmbtu) − Revamp: US$ 245-255/MT (upto gas price of US$7.5/mmbtu)

For every US$0.1/mmbtu increase in gas price, Floor-Cap to increase by US$2/MT Linkage to Gas prices Vague (US$2.2/MT for revamp projects) till gas price is US$14/mmbtu. Only floor increase post that Urea prices - % of 90% for brownfield; 95% for Import Price Parity 90% for brownfield; 95% for greenfield/revival; 85% for revamp revival; 85% for revamp (IPP)

• For greenfield / revival & brownfield projects, the new policy protects downside risk (high gas price & low IPP scenario) through implicit pass through of gas prices • It also provides a moderate upside (to the extent of RoE of 20% till gas prices of US$14/mmbtu) at high IPP and moderate to high gas prices compared to the old policy

National Fertilizers Limited 8 TABLE OF CONTENTS

1 Indian Fertilizer Scenario

2 National Fertilizers Limited

3 Corporate Social Responsibility

4 Appendix

National Fertilizers Limited 9 MAJOR FERTILIZER COMPANY

. National Fertilizers Limited (NFL), a Schedule ‘A’ and a Mini Ratna Category-1 Public Sector Undertaking, was incorporated on 23rd August, 1974

. In April 1978, the Nangal Group of Plants of Fertilizer Corporation of India (FCI) were transferred to NFL upon reorganization of NFL-FCI

. The , in 1984, entrusted the Company to execute the country’s first inland gas based fertilizer project of 0.726 mn tones Urea capacity in Guna, Madhya Pradesh which was commissioned in 1988

. NFL has a market capitalization of Rs. 16,480 mn1 and is listed on the BSE and NSE

. The Government of India currently owns 97.64% of its paid up share capital

. NFL has been a consistent dividend paying (up to FY12) company since inception

. 2nd largest producer of urea having manufacturing capacity of ~3.57 mn tonnes in FY13 with plans to increase it to 3.65 mn tonnes in FY15

. Diversified portfolio with additional revenue streams from bio-fertilizers, bulk industrial products and trading

Strong Industry Position Experienced Management Team Established Track Record Operational Excellence

• 2nd largest Urea manufacturer in • Efficient, multi product and • Board has significant experience in India • Large existing operating facilities integrated network of plants leadership roles • Fertilizer brands of Urea – (Kisan • Strong market network to handle facilitating operational flexibility and • Management team with significant Urea), Augmented Urea - (Kisan and market huge quantities of scalability market and operation expertise in neem coated urea) etc. have high fertilizers • Awarded MOU Excellent Rating by fertilizers degree of brand recall & patronage GOI for the past several years

1 as on July 12, 2013 National Fertilizers Limited 10 BUSINESS STRUCTURE

FY13 SALES EBITDA

• Urea – Manufactured & Nitrogenous 98.13% Imported Fertilizers • Neem Coated Urea

67.86%

•Nitrogenous Bio-fertilizers Bio-Fertilizers 0.05% •Phosphorus Bio-fertilizers

•Nitric Acid 1.37% Industrial Products •Ammonium Nitrate •Others

32.14%

City compost Traded Products Certified seeds 0.45% Agrochemicals

National Fertilizers Limited 11 MAJOR UREA PLAYER

Product Portfolio Production Performance

 NFL manufactures and markets various Product Capacity FY10 FY11 FY12 FY13 fertilizers and chemicals which have a high Urea – Nangal (mn MT) 0.47 0.47 0.47 0.50 0.47 degree of brand recall and patronage. Urea – Panipat (mn MT) 0.51 0.51 0.47 0.50 0.41  Urea: NFL enjoys a 14.22% market share in Urea – Bathinda (mn MT) 0.51 0.51 0.55 0.48 0.39 Urea Sector and its Urea is sold under the Urea – Vijaipur I (mn MT) 0.99* 0.88 0.91 0.90 0.96 popular brand name “Kisan Urea”. Urea – Vijaipur II (mn MT) 1.06* 0.95 0.96 1.01 0.96  Neem coated Urea – Sold under the brand Bio-fertilizers (MT) 600** 226 231 571 448 name “Kisan neem coated urea”, NFL enjoys * Installed capacity enhanced from 0.86 mn MT each to 0.99 & 1.06 mn MT at Vijaipur-I & II about 5.4% market share. respectively during FY13. ** Installed capacity enhanced from 100 MT to 600 MT during FY12.  Bio-Fertilizers – Rhizobium and Azetobactor ***Quantity of Bio-fertilizers is in MT and for urea, it is in mn MT (Nitrogen based) and P.S.B. Phosphate (Phosphorus based) Sales Performance

 Industrial Products such as Nitric Acid, Prime Fertilizers Unit FY10 FY11 FY12 FY13 Ammonium nitrate, Sodium Nitrate/Nitrite, Anhydrous , etc. which are used in Urea – Nangal mn MTPA 0.48 0.47 0.50 0.48 diversified applications Urea - Panipat mn MTPA 0.53 0.47 0.49 0.41 Urea – Bathinda mn MTPA 0.52 0.55 0.48 0.39  Trading – NFL also trades in city compost, certified seeds, agrochemicals and other Urea – Vijaipur I mn MTPA 0.89 0.92 0.91 0.95 chemical fertilizers like Potassium Chloride Urea – Vijaipur II mn MTPA 0.96 0.94 1.00 0.94 (MOP), DAP, nitro phosphate, etc. Bio-fertilizers* MTPA 196 219 410 509 *Quantity of Bio-fertilizers is in MTPA and for urea, it is in mn MTPA

National Fertilizers Limited 12 OPERATIONAL EFFICIENCY

Urea – Nangal Urea - Panipat Energy Gcal/MT Energy Gcal/MT 9.52 9.51 10.20 10.15

9.50 9.49 10.10 9.99 10.00 9.48 9.90 9.46 9.79 9.78 9.45 9.80 9.44 9.44 9.70

9.42 9.60

9.50 9.40 FY10 FY11 FY12 FY13 FY10 FY11 FY12 FY13 Urea – Bathinda Urea – Vijaipur I & II

10.00 9.94 5.90 5.84 5.84 5.78 5.77 9.90 9.85 5.80 5.70 5.62 9.80 5.60 5.48 5.49 9.70 5.50 5.44 9.62 9.61 5.40 9.60 5.30 9.50 5.20 FY10 FY11 FY12 FY13 9.40 FY10 FY11 FY12 FY13 Urea – Vijaipur-I Urea – Vijaipur-II Energy consumption at Nangal, Panipat and Bathinda has reduced by around 2-2.5 Gcal/MT post conversion of feed stock to Natural gas National Fertilizers Limited 13 MANUFACTURING FACILITIES

Nangal plant • Nangal Unit was commissioned with an installed capacity of 0.33 mn MT which was further revamped to 0.48 mn MT in 2001 • Accredited with ISO-9001:2008, ISO-14001 & OHSAS-18001 • Manufactures Urea, Nitric Acid, Ammonium Nitrate, Sodium Nitrate/Nitrite • Feed stock for manufacture of Ammonia/Urea has been converted from fuel oil to Natural Gas in April 2013

Panipat plant • Commissioned in 1979 based on gasification technology of LSHS / Fuel oil with an installed capacity of 0.5 mn MT and its feed stock was converted to Natural gas in January 2013 • Accredited with ISO-9001:2008, ISO-14001 & OHSAS-18001 • Manufactures Urea • Captive power plant of 2 x 15 MW

Bathinda plant • Commissioned in 1979 based on gasification technology of LSHS / Fuel oil with an installed capacity of 0.5 mn MT and its feed stock was converted to Natural gas in January 2013 • Accredited with ISO-9001:2008, ISO-14001 & OHSAS-18001 • Manufactures Urea • Captive power plant of 2 x 15 MW

National Fertilizers Limited 14 MANUFACTURING FACILITIES

Vijaipur Unit I & II • Unit I was commissioned in 1988 and its capacity was revamped to 0.99 mn MT in 2012 • Unit II was commissioned in 1997 and its capacity was revamped to 1.06 mn MT in 2012 • Vijaipur Unit I received the first prize for “Excellence in Project Management” from the Ministry of Program Implementation, GoI for executing the country’s first inland gas based fertilizer project in 1988 which was completed well within time & in the approved cost • Accredited with ISO-9001:2008, ISO-14001 & OHSAS-18001 • Manufactures Urea, Bio-fertilizers • Captive power plant: 3 x 17 MW

Manufacturing Capacity Capacity Utilization

Capacity FY10 FY11 FY12 FY13 Nangal Panipat Bathinda Vijaipur utilization

Urea – Nangal 99.1% 100.0% 105.2% 98.5% Major Capacity Capacity Capacity Capacity Products Urea - Panipat 100.3% 91.9% 97.8% 80.9% Ammonia 900 900 900 3,614 (MTPD) Urea – Bathinda 100.6% 108.1% 94.4% 77.1%

Urea (MTPD) 1,450 1,550 1,550 6,261 Urea – Vijaipur I 101.6% 106.0% 104.4% 97.5%

Urea – Vijaipur I 109.8% 111.2% 117.0% 96.5% Bio- fertilizers - - - 600 (MTPA) Bio-Fertilizers 226% 231% 95.2% 74.7%

National Fertilizers Limited 15 SIGNIFICANT MARKET SHARE & MARKETING NETWORK

Urea Market Share

Markets Industry Sales NFL Sales (in mn % (in mn tonnes) tonnes) Chandigarh Zone 6.93 1.41 20 Lucknow Zone 8.81 0.98 11 Bhopal Zone 4.89 0.70 14 Total 20.62 3.09 15

No. of Dealers Across Markets

Markets No. of dealers %

Chandigarh Zone 529 28

Lucknow Zone 564 30

Bhopal Zone 784 42

Total 1877 100

NFL’s market share in bio-fertilizers is 1.4%

National Fertilizers Limited 16 SUSTAINED CAPITAL EXPENDITURE TOWARDS REVAMP

Project Project Cost Commissioning Year Benefits Envisaged

Nangal unit was first revamped when its capacity was increased to 0.47 mn MT in Nangal Revamp 2001. Recent revamp was to change the Project Rs.14,785 mn Apr 2013 feed stock from LSHS/Fuel oil to Natural Gas which will result in the reduction of subsidy burden as well as carbon footprint.

To change the feed stock from LSHS/Fuel Panipat Revamp oil to Natural Gas resulting in the Project Rs.12,928 mn Jan 2013 reduction of subsidy burden as well as carbon footprint.

To change the feed stock from LSHS/Fuel oil to Natural Gas resulting in the Bathinda Revamp Rs.12,941 mn Jan 2013 Project reduction of subsidy burden as well as carbon footprint.

Capacity augmentation by 16% and 23% respectively along with saving in energy Vijaipur I & II Revamp April & Rs.6,500 mn consumption besides installation of Project July 2012 Carbon Dioxide Recovery plant. Capacity was increased by 0.34 mn MTPA

National Fertilizers Limited 17 EXPANSION PLANS

Estimated Est. Completion Project Deliverables Status Capex year

TEFR for preliminary Feasibility of the Revival of FCI Plants of Project has been prepared Ramagundam revival Ramagundam in Joint Rs. 47,000 mn 2017-2018 venture with M/s EIL Selection of Technology Licensor is under process

Installation of Purge Gas Increase in Urea capacity Recovery(PGR) and Consultant has been appointed for by 239 MTPD i.e. 0.08 Rs.800 mn 2014-2015 Process Air Compressor at MTPA selection of LSTK Contractor Vijaipur Unit II

Installation of SSP Plant at New SSP Plant of Techno-economic Feasibility Study is Rs. 800 mn 2015-2016 Panipat capacity of 0.3 MTPA under study by Consultant.

Discussions are underway with Heavy Installation of Heavy New Heavy Water Plant - - Water Board (HWB). Due diligence to Water Plant at Vijaipur be carried out by HWB.

New Water Soluble Water Soluble Fertilizer Fertilizers Plant at - - Study is being carried out Plant Nangal

National Fertilizers Limited 18 TECHNICAL CAPABILITIES

Procurement & Operations Research & Development

• Strong in house team of qualified professionals to oversee • Research & Development Division has developed Neem Coated Urea commercial activities and operations. and NFL is the first company in the fertilizer industry to be permitted • Frequently scouting for new technologies and adopting best by Government to manufacture Neem Coated Urea practices. • Successfully developed liquid bio-fertilizers on a pilot basis • Has a strong vendor arrangement ensuring timely availability at • Developed techniques to re-use off gases vented in Urea plant in competitive prices. Vijaipur-II as fuel in CPP boilers • Operations team capable to maneuver plant loads with high skill and efficiency meeting product mix demand/ requirements • Currently evaluating the effects of method of application of bio- fertilizers, city compost and Pseudomonas Fluorescence on plant growth and of City compost and Zinc sulphate on wheat crop trials on use of blended water soluble fertilizers Project Conceptualization, Evaluation & Commissioning Human Resources

• Technically and professionally qualified employees • Excellent team of experienced engineers and managers conceptualizing expansion plans from concept to commissioning • Very cordial industrial relations scenario • The team prepares project reports containing detailed estimates, • HR policies focus on all round development of all employees and implementation schedules and techno-economic viability of imparts regular training in various functions like Marketing, projects Finance, Operations , Health & safety etc. • Project Management team employs state of art project • High employee productivity – value added per employee of INR management tools for effective time, cost and resource 2.29 Mn in FY13 management • Total employee strength of 4,254 employees as on May 31, 2013

National Fertilizers Limited 19 FINANCIAL PERFORMANCE

Turnover (Rs.mn.) Revenue Breakup EBITDA (Rs.mn.) & margins

4,000 7.17% 8.00% 5% 4% 3% 2%

3,500 7.00%

3,000 5.20% 6.00%

2,500 5.00%

67% 68% 73% 74% 3,650

2,000 3,420 4.66% 4.00%

73,405

3,020 67,467

1,500 0.63% 3.00%

1,000 2.00% 58,040

500 1.00% 51,000 28% 28% 424 24% 24% 0 0.00% FY10 FY11 FY12 FY13 FY10 FY11 FY12 FY13 EBITDA % Margin FY10 FY11 FY12 FY13 Fertilizer Fertilizer Subsidy Others EBITDA in FY13 was lower on account of higher energy FY13 turnover was lower on account of plant ‘Others’ include revenue from sale of bio-fertilizers, consumption vis a vis lower production/sales and also shutdown for shifting of feed stock to Natural Gas industrial products and trading due to increase in market price of outsourced thereby reducing Urea production and in turn, sales ammonia for production of industrial chemicals

PAT (Rs.mn) over the years Debt to Equity; Dividend Payout; BV Net worth (Rs.mn.)

18,000 15.00%

2,000 4.00% 10.87%

17,500 8.31% 10.00%

36 7.24% 1,500 3.37% 3.00%

3.03

17,000

1,000 2.39% 5.00%

2.00%

1,720

16,500 1.73% 17,544

500 1,390

0.00% 1,270 1.00% 34

16,000

0

0.00% -5.00%

16,720

15,500

-500 FY10 FY11 FY12 FY13

-1.00% 1.7 -10.00%

-1,000 32 15,000 -10.78% 15,837

32 15,820 1,707 -2.00%

-1,500 - 14,500 -15.00% -2.53% -2,000 -3.00% FY10 FY11 FY12 FY13 29.95% 30.00% 30.13% PAT % Margin 0.00% Net Worth RONW 0.37 0.25 There was a loss in FY13 due to lower EBITDA, FY10 FY11 FY12 FY13 provision for purchase tax liability for prior period Net worth dropped in FY13 due to negative PAT in under exceptional item and increase in interest D/E Dividend Payout BV FY13 expenditure mainly due to delay in receipt of subsidy

National Fertilizers Limited 20 TABLE OF CONTENTS

1 Indian Fertilizer Scenario

2 National Fertilizers Limited

3 Corporate Social Responsibility

4 Appendix

National Fertilizers Limited 21 CORPORATE SOCIAL RESPONSIBILITY

Health & Hygiene

Promote non- Women conventional energy empowerment CSR Focus

Social forestry Child education

Water conservation & stop dams

• NFL’s CSR goals aim at providing basic utilities like health & hygiene services to needy, educating children, empowering women, green initiatives and improving the quality of life of its stakeholders towards nation building • The approach is holistic and oriented towards community and stakeholders • CSR model is integrated into its business strategy

National Fertilizers Limited 22 TABLE OF CONTENTS

1 Indian Fertilizer Scenario

2 National Fertilizers Limited

3 Corporate Social Responsibility

4 Appendix

National Fertilizers Limited 23 BOARD OF DIRECTORS He has over 30 years of experience spanning various fields of conceptual design, project design and project management among others He holds a degree in Chemical Engineering and Masters degree in Business Administration Mr. R.G. Rajan, He also holds the position of Chairman & Managing Director in RCF Ltd. Chairman & Managing Director He is also the Chairman of Fertilizer Association of India and Member of SCOPE (Standing Conference of Public Enterprises). She has an extensive experience spanning over 31 years in the field of Financial Management and is a Chartered Accountant by profession Ms. Neeru Abrol, She is responsible for formulating financial strategies and planning and was earlier associated with SAIL Director (Finance) She was also a member of SCOPE (Standing Conference of Public Enterprises) and was on the Board of Directors of Fertilizer Association of India Capt. Kaul is a Master Mariner, a Post Graduate in Public Administration and a Diploma in Logistics Management Capt. Pavan Kumar Kaul, Prior to joining NFL, Capt. Kaul was Executive Director, Container Corporation of India (CONCOR) Director (Marketing) He has been a member of the Administrative Staff College of India, Institute of Rail Transport and is a member of the CII National Exports Committee and the Board of Directors of Fertilizer Association of India

He hold a degree in Chemical Engineering from NIT Surathkal, Karnataka Mr. C.M.T. Britto, He is also the technical director at RCF Ltd. and in his long career spanning more than 30 years, he has worked Director (Technical) in various capacities in Technical Services, Ammonia, Sulphuric acid, Concentrated Nitric Acid plants and in development of projects for RCF Ltd.

Shri Satish Chandra is a senior IAS officer of 1986 batch Mr. Satish Chandra (IAS), Shri Chandra joined the Board of the Company on 27 October, 2008 and held the additional charge as Chairman & Managing Director, NFL from 31 March, 2011 to 23 December, 2011 Govt. Nominee Director He is also a Director on the Board of Directors of Limited, Indian Potash Limited, OMIFCO and Fertilizer and Chemicals Travancore Limited

National Fertilizers Limited 24 BOARD OF DIRECTORS

Mr. S.C. Gupta (IAS), Govt. Nominee Director Shri Suresh Chandra Gupta is a senior IAS Officer of 1986 batch. Before joining IAS, Mr. Gupta worked for Development & Financial Institutions like IDBI, LIC, PNB and UTI Presently, he is Joint Secretary with Department of Fertilizers, Government of India

Mr. Munikoti Niranjana Rao, Independent Director He is a Practicing Chartered Accountant in Visakhapatnam He has over 30 years extensive experience in the field of Banking, Taxation, and Financial Management and joined as Independent Director in the company on 6 May, 2011

A senior IAS officer of 1976 batch, he retired as Secretary in Government of India in the Ministry of Mr. M. Raman, Chemicals & Petrochemicals in April, 2011. Independent Director During his 35 years in the service, he had held various important positions both in Central and State Governments. He has experience of more than two decades in policy formulation, monitoring and implementation of matters related to industrial development and infrastructure sector.

Mr. Vikram Srivastava, Independent Director He is an IPS 1973 batch officer (Retd.) and held various important positions with the Central and State Government including ex-Director General, BPRD, CRPF, ITBP. He has experience in development of new institutions focusing on public importance

National Fertilizers Limited 25 AWARDS & ACCOLADES

. Panipat Unit has been declared winner of prestigious National Level Safety Award “Shreshtha Suraksha Puraskar” by National Safety Council, Mumbai (India) under the scheme NSCI Safety Awards 2012 among manufacturing Sector (Group- B). This is the highest level Safety Award given to any large scale for this Scheme (2012)

. Panipat Unit has been awarded “Shreshtha Suraksha Puraskar” for the year 2011 from National Safety Council, Mumbai (India), in the manufacturing sector of Chemical & Chemical products.

. Panipat unit was awarded the National Level Safety Award “FAI Award for excellence in Safety in Nitrogenous and Complex Fertilizer plant” as a runner Up for 2011-12 from FAI and was presented by Shri SK Jena, Hon’ble Minister of State for Chemicals & Fertilizers, Government of India

. ICWAI National Awards in 2007, 2008, 2009 & 2010 for excellence in Cost Management for units and the Company

National Fertilizers Limited 26 STRENGTHS, OPPORTUNITIES & RISKS

Strengths Opportunities

• Second largest producer of urea in the country with 14.2% • Wider acceptability of neem coated urea in the market offers an market share. opportunity to augment production of neem coated urea. • Above 100% Urea capacity utilisation for the past 8 years. • Government of India on nomination basis has allotted NFL & • A Mini-Ratna Schedule A Category Company. Limited (EIL) and NFL & • Projects of over Rs. 47,000 mn under various stages of Limited (SAIL) for revival of closed units of FCIL at Ramagundam implementation and respectively. These ventures will provide the • NFL is the first fertilizer manufacturer in the country, which has Company an opportunity to establish itself as a market leader in developed technique for coating of normal prilled Urea with urea. neem oil on a large scale. • The switchover of feedstock from fuel-oil to Natural Gas at their plants will reduce cost of production and result in energy savings in the coming years • Venturing in to non-urea fertilizers by manufacturing/trading

Internal Risks External Risks

• Stagnant Urea Sales (in the range of 3.24 mn MT (FY08) to 3.39 • Urea policy related issues including those governing subsidies and mn MT (FY12)) its release to companies • Over dependence on Urea • Fluctuations in global raw material prices & natural gas prices • Marketing network mainly concentrated in Northern and Central • High cost of domestic gas and its allocation or shortage of gas India • Agro-climatic conditions can have an impact on the performance • Current financial position of the Company • Stringent terms in gas supply and transportation contracts and their operability • Recession in international chemical market leading to un- remunerative domestic prices • Resistance by farmers to price hike in fertilizers • Large scale of operations in international chemical market may lead to lower pricing power

National Fertilizers Limited 27