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RAILWAYS…OPPORTUNITY FOR FOUNDRIES 16TH NOVEMBER 2018

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• Introduction to Wabtec

• Indian Rail Transportation Market

• Opportunity for Castings in Railway Rolling Stock

• Expectations from the foundry suppliers from the Rail industry

AGENDA

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INTRODUCTION TO FAIVELEY TRANSPORT, A WABTEC COMPANY

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/// COMPANY OVERVIEW

Founded in 1869 by George Westinghouse

Corporate Headquarters in Wilmerding,

Pennsylvania, USA

Operations in 30 countries

More than 100 manufacturing facilities

Nearly 20,000 employees

Listed on NYSE (WAB)

Estimated revenues $4 Billion

Wabtec Corporation, resulting from the combination of Wabtec and Faiveley Transport, is one of the world’s largest public rail equipment companies

with a presence in all key freight rail and passenger transit markets worldwide.

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///#6 Location

Mftg / Engg

Entity name / Products / Activities

1 Hosur Mftg.Faiveley Transport Rail Technologies India Ltd.Products: Transit Brake Systems, Couplers, Door Systems, Pantographs, HVAC etc.

2 Baddi Mftg.Faiveley Transport Rail Technologies India Ltd.Products: Transit Brake Systems, Couplers

3 Bangalore Mftg.

Metalocaucho - MTC IndiaProducts: Metal Bonded Rubber Products for Primary & Secondary Suspensions e.g., Conical Spring, Guiding Bush, Buffer, Pivot Bush, Traction Block, Layer Spring etc.

4 Kolkata Mftg.

Wabtec Texmaco RailProducts : Draft Gear, Freight Brake Systems, Freight Auxiliaries, Friction Wedge, Composition Brake Shoes, Interco Receiver Assembly units

5 Bangalore Engg.

Wabtec Engineering & Technology Centre ( XORail)Activities : Signal Engineering for Xorail , USA & WCS, Australia . Software Development & Testing, Mechanical Designs & RAMS and Product Engineering for various Wabtec BUs in the USA.

5 Bangalore Engg.

Faiveley Transport (BEC) Activities: Engineering centre to support global Wabtec companies for design, FEA, software and documentation

5Hyderabad

Engg.A M RailActivities : Signal Engineering for UK Railroads through AM Rail, UK.²

629 locations

Field Services

WABTEC IN INDIA TODAY

Manufacturing units in Hosur, Baddi, Bangalore & Kolkata Software design & Engineering for global Transit & Freight in Bangalore, Hyderabad 148 Field services personnel spread across India’s geography for IR & Metro

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/// CUSTOMER REFERENCES

CLW

DLWDMW

Delhi Metro

Chennai Metro

Lucknow Metro

Kochi Metro

Operators

Loco & Car Builders

Indian Railways Delhi Bangalore Hyderabad Chennai KochiNoida Lucknow Kolkata Nagpur Ahmedabad

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RAIL TRANSPORTATION MARKET IN INDIA

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INFRASTRUCTURE & MAINTENANCE

MACRO ECONOMIC TRENDS

» Ministry of Railways fueling investment from industry

» IR planning to build new EMU factory in Maharashtra

» European giants Alstom & Bombardier using India footprint for local and global Metro projects

URBANIZATION

» 76 Cities in India identified to have Metro Rail networks

» Metro projects approved in Tier 2, 3 cities

» Manufacture of Trainsets at ICF & SMART coaches at MCF to enhance passenger experience & safety

“Make in India” initiative by the Central Government

“SMART” cities initiative byMinistry of Urban Development

Semi High Speed Train Sets/SMARTCoaches by IR

POLICY INITIATIVES

Dedicated Freight Corridorsprojects - increase in freighttraffic

» GET building 900 Diesel locomotives at Marhowrah in Bihar

» Alstom building 800 Double E Locos at Madhepura in Bihar

» Move towards preventive maintenance, Higher Availability &Reliability, Low Life Cycle Cost

12000 HP Locomotive

Train Sets >160 KMPH

Metro Trains

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/// INDIAN RAILWAYS – VITAL STATISTICS

Indian Railways - Key Figures:

No. of Coaches 54,506

No. of EMU/MEMU/DEMU 8,805

No. of Electric Locomotives 5,528

No. of Diesel Locomotives 5,869

No. of Wagons 2,51,256

Total Route Kilometers 66,687

Broad Gauge (1676 mm) 60,510

Metre Gauge (1000 mm) 3,880

Narrow Gauge (762/610 mm) 2,207

Total electrified route KMs 30,012

No. of type of trains 12

No. of classes of accommodation 10

Passenger carried per day (million) 22

Freight carried per day (Billion Tonne) 1

Total no. of people working with IR 13,07,000

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/// RAILWAY MARKET SCENARIO…

Indian Railways:» IR Electric Locomotives production: Significant ramp up from 350 in 2017-18 to 650+ in 2018-19 -> 1000

by 2020-21

» LHB Coaches production in RCF, ICF & MCF : Ramp up from 3000 coaches in 2017-18 to 4500+ coaches in 2018-19 -> 6000 Coaches in 2020-21

» Semi high speed Train Sets SS Car body > 160 KMPH developed by ICF in 2018-19 -> ramp up to 300 train sets per annum by 2022-23

» Light weight Aluminum car body Train Sets > 160 KMPH to be manufactured at ICF from 2021-22 through TOT from European Car Builders

» Alstom diesel loco build – 1600 units & GE electric loco build – 900 units -> period of 10 years starting from 2018

Metro:» Contracts for 4000+ Cars to be awarded in India over the next 4 / 5 years - Tier 1 & Tier 2 cities identified

by MOUD - Key projects – Mumbai line 3, 2 & 7, Bangalore Phase 2 & Phase 3, Chennai…

“Make in India”, Smart Cities, Fleet Upgradation – Fueling growth

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CASTINGS FOR ROLLING STOCK

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/// CASTINGS IN RAILWAYS…BOGIE PARTS FOR FREIGHT & TRANSIT

» Every bogie requires steel cast Side Frames & Centre frames

» 2 each per Bogie and 4 per coach

» Steel castings fully finished with secondary operations

CASTING IS AN INTEGRAL PART OF RAILWAYS…

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/// CASTINGS IN RAILWAYS…COUPLERS FOR INDIAN RAILWAY & METRO

» Steel cast assembly comprising of coupler head, knuckle & lock for Coaches & Wagons of Indian Railways

» Draw bar assembly with coupler head and knuckle - Metros.

» Assembled with surface protection

» Safety critical

» Zero tolerance on deviations

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/// CASTINGS IN RAILWAYS…DISC BRAKE SYSTEMS

» Grey iron Friction ring for Axle mounted disc & SG iron caliper parts.

» 8 units per LHB coach, mandate from IR to migrate to LHB coaches on a fast track.

» Grey iron Wheel mounted disc for Metros – 56 units per coach.

» Strong emphasis on safety

» Stringent quality requirements

» No deviation in specifications

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/// CASTINGS IN RAILWAYS…

Diverse portfolio

Axle box housings for Wagons Brake cylinder Body

Cylinder Head for Loco Air generation Treatment unit

» SG iron castings

» Steel castings

» Aluminum castings

» Non ferrous castings

» Investment castings

» Gravity die castings

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/// MARKET EXPECTATIONS - SUPPLY CHAIN FOCUS…

» DELIVERY OF PRODUCTS AT SHORT CYCLE TIME

» BATCH PRODUCTION, DIVERSE PARTS, MULTIPLE TECHNOLOGIES

» EFFICIENT MAN, MACHINE, MATERIAL AND RESOURCE PLANNING

» INVENTORY AND CONSIGNMENT STOCKING, WILLINGNESS TO WORK ON VMI

» QUICK TURNAROUND OF NEW PRODUCT DEVELOPMENT

» COMMITMENT TO PROVIDE COMPLETE SOLUTION – TCO CONCEPT

» SUPPLIER RELIABILITY AND ADHERANCE TO DELIVERY COMMITMENT

» AGILITY AND FLEXIBILITY, ETHICAL BUSINESS INTERACTION

» COST REDUCTION INITIATIVES, PARTNERSHIP APPROACH

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/// MARKET EXPECTATIONS - QUALITY REQUIREMENTS…

» INHOUSE METALLURGY TESTING WITH RADIOGRAPHY

» UPSTREAM QUALITY – INVOLVEMENT IN DESIGN

» GREEN CHANNEL, STRONG PROCESS AND INSPECTION STANDARDS

» WELL TRAINED RADIOGRAHY PERSONNEL AND OTHER METHODOLOGIES

» APQP AND PPAP APPROACH ON NEW DEVELOPMENTS

» TIER 2 SUPPLIER MANAGEMENT AND AUDIT PROCESS

» EMISSION NORMS ADHERANCE & EHS.

NEED CUSTOMER CENTRIC APPROACH TO MEET GROWING MARKET…

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/// EXPECTATIONS FROM SUPPLIERS

Best in class product quality - Deliver right the first time and every time1

On time delivery - Key to maintain customer satisfaction & WIN repeat business2

Cost reduction initiatives - Continuous assessment of processes and technology without

compromising quality to stay ahead of local and Chinese competition3

Volume based productivity discounts - Focus on consistent, sustainable revenue

growth & share volume driven cost benefits 4

Project specific frame agreements - Back to Back agreements on Warranty , Year on

Year price escalation formula , Productivity discounts for long term MEGA projects5

Partnership approach - Share non recurring costs and invest in new product

development6

BE OUR PARTNERS IN EXCELLENCE – BELIEVE IN US, INVEST & GROW WITH US

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THANK YOU