1

Presentation to

SEC Chairmanon

Heavy Electrical Complex

August 16, 2013

Presentation on

Heavy Electrical Complex

January 31, 2014

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Contents

• Introduction

• Products and Facilities

• Performance

• Planned Activities and Investors Attractions

333

Introduction

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HEAVY ELECTRICAL COMPLEX

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Commercial Operations 1997

Machinery Source China (62%), Germany, Switzerland, Local

Cost Rs. 1,158 Million

Area 72 Acres (Factory 43 Acres)

Human Resource 222 NOS

Product Power Transformers 6.3 t0 40 MVA

Transformers Supplied New 276 Nos. (Rs. 7.01 Billion)Repair 104 Nos. (Rs. 574 Million)

Capacity Utilization Maximum up-to 30 %

Quality Certification ISO-9001

Customers DISCOs, KESC and other organizations (Pakistan Steel, CDA, Railway, Private Industries)

Competitors PEL, Siemens, Foreign Suppliers

Profile

Share Ownership

-

* Benazir Employees Stock Option Scheme

6

Shareholding

Number % age

GOP through SEC

14,100,012 96.6

BESOS* 495,835 3.4

3 Directors 03 _

Total 14,595,850 100.0

Manpower (As on 31.12.2014)

S# Categories Regular Through Labour

Contractor Total

1. Officers

Engineers

Diploma Holders

Professional

20

02

04

03

03

04

23

05

08

2. Supervisors 02 08 10

3. Workers - 176 176

Total 28 194 222

888

Products

Sub-Assemblies

Manufacturing Facilities

99 Repair/Rehabilitation of Power Transformers

Voltage rating upto 500 KV and with capacity rating upto 250 MVA

New Power Transformers – Acquired Technology

S# Rating Nos MVA

1 31.5/40 MVA, 132/66/11.5 KV 3 120.0

2 31.5/40 MVA, 132/12/11 KV (KESC system) 8 320.0

3 20/26 MVA, 132/11.5 KV 59 1,534.0

4 10/13 MVA, 132/11.5 KV 59 767.0

5 6.3 MVA, 132/34.5 KV 5 31.5

6 10/13 MVA, 66/11.5 KV 10 130.0

7 6.3 MVA, 66/11.5 KV 4 25.2

Total 148 2,927.7

In - House Developed/Modified8 31.5/40 MVA, 132/11.5 KV (WAPDA system)9 20/26 MVA, 132/6.6 KV (Cement Sector)10 10/13 MVA, 66/11.5 KV (HESCO system)11 7.5 MVA, 132/6.6 KV (CDA )

Product-Mix

1,5,6,7 phased out from of WAPDA system

1010

HEC DESIGNED POWER TRANSFORMER - RATING 31.5/40 MVA, 132/11.5 KV – WEIGHS 78 TONS INCLUDING OIL 22.8 TONS, RADIATORS 18 NOS

Power Transformer – 40MVA

111111

RATING 20/26 MVA, 132/11.5 KV, WEIGHS 72 TONS INCLUDING OIL 28 TONS, RADIATORS 10 NOS ←

Power Transformer – 20/26MVA

Sub-Assemblies

Manufacturing Facilities

141414

Performance

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40 MVA26 Nos

Rs. 966 Million

20/26 MVA186 Nos

Rs. 4,804 Million

10/13 MVA64 Nos

Rs. 1,240 Million

Repair / Rehabilitation

104 NosRs. 574 Million

Total (276+104) Power Transformers- RS. 7,584 Million

Sales Summary – Upto Dec 2013

Operational and Financial position for last 5 years

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Description 2008-09 2009-10 2010-11 2011-12 2012-13

PT Supplied (No's)

30 28 23 14 17

Capacity Utilization

19.4% 24.6% 20.9% 8.6% 16%

Sales 797 965 828 539 704

Gross (Pr/Loss) (4) 94 73 68 78

Pre tax Profit/(Loss)

(42) 32 (26) 8.5 (6.9)

Total Assets 1,433 1,774 1,714 1,378 1,694

Total Liabilities 236 552 527 188 486

Accumulated Profit/(Loss)

(263) (238) (273) (270) (280)

Net Equity 1,197 1,222 1,187 1,190 1,180

Value in Rs Million

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Order Position FY 2013-14 (Rs. In Million)

SN Client Description Qty. Value

1 PESCO 20/26MVA 1 38.000

2 ALSTOM 20/26MVA 2 79.000

3 USAID/PESCO Fan Motors, CBs ETC 12.530

4 FESCO 31.5.40 MVA 1 47.600

4 177.130

1 Colony Mill Multan 20/26 MVA 1 38.0001 38.000

1 ALSTOM 20/26 MVA 1 6.6202 PESCO/USAID 20/26 MVA 1 14.3903 Pak. Steel 4000KVA 1 3.850

3 24.8604 62.860

1 SEPCO/19.11.2012 10/13 & 20/26 MVA 6 237.00020/26 MVA 131.5/40 MVA 2

3 LESCO/30.10.2013 31.5/40 MVA 13 598.00022 968.000

1 IESCO 30/37MVA, SAVIGLIANO/Wah 1 16.5842 IESCO 20/26MVA, Minal/Wah 1

3 GEPCO 20/26MVA, Siemens/Bhimber 1 4.655

4 GEPCO 10/13MVA, Ganz/K.Sheikhan 1

4 21.23926 989.239

NEW P/TFs

TOTAL; C

SUB TOTAL

SUB TOTAL

C. EXPECTED ORDERS

NEW P/TFs

NEW P/TFs

TOTAL; A

B. ORDERS IN HAND

A. ORDERS EXECUTED

TOTAL; B

Repair of TFs

SUB TOTAL

2 MEPCO/06.11.2013 133.000

SUB TOTALRepair of TFs

181818

Planned Goals

and

Attractions for Investors

Future Goals

Plan Target

Short Term Plan (2 Year)

Business Enhancement Gradually enhancing annual sales turnover to Rs. 1. 2 billion in next two years

Design Optimization Finalizing improved design 20/26 MVA prototype during FY 2013-14

Mobile GSM System Launching New GSM System for Smart Grids during 2014

Systems Improvement Phase-wise Introduction of Enterprise Resource Planning in the company during 2013-14 and 2014-15

Enhancing In-house Testing Facilities Procurement of Impulse Generator by 2015

Long Term Plan

Diversification for manufacturing higher module step down power transformers (160 MVA and 250 MVA) as well as step up generator transformers

02 years after seeking government clearance to line-up suitable foreign investor and technology partner

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Comprehensive, Integrated and Largest Power Transformer manufacturing facility in the Country

Abundant Land/Shop space and Infrastructure available for product diversification with less investment and short time frame

ISO 9001 Certified Company Easy access to Road and Railway network

Vast and growing market due to planned expansion of power sector

Conducive National investment policies moving towards open economy

Attractive incentives for local manufacturing

Availability of skilled manpower at reasonable wages

Ample Export opportunities being located geographically close to potential

markets of Afghanistan and Central Asian States

Investors Attractions

212121

Thank You