5/29/2015

1

Spreading Wings…

Largest manufacturers of

Industrial Explosives and

Initiating Systems in India

Largest Cartridge manufacturing

facility in a single location, globally

One of the largest Manufacturing

Facilities of Detonating Cord

and Cast Boosters in the world

Largest exporter of industrial explosive from India in 2015

Complete product range with

presence across the product value

chain

Commissioned manufacturing

facilities for Propellants and

HMX

Who we are…

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2

Key Strengths

Backward

integration of raw

materials to a

large extent

Inward & outward

logistics provides a

strong distribution

network

Plants are certified

for ISO 14000 &

18000 OHSAS

(18001-2007)

Advanced

Technology & R&D

set-up recognized

by DS &T

Enhanced systems

for Safety, Health

& Environment

System controlled

through SAP ERP

Our CRISIL rating

for borrowing s for

Long term "CRISIL

AA“ and for Short

Term "CRISIL

A1+".

Marquee Clientele

Experienced

Management

Team

1984Commenced

business as a Trader

in Explosives

1996Started production

of explosives with

a license capacity of 6000 MT

1998Commenced

production of

Detonators

2000Started plants in

Waidhan for

production of Bulkexplosives

20012002-05

2007-142006

Initial public offer

(IPO);gets listed

Established another

Bulk explosive unit in

Chanderpur with 7750 MT capacity

Introduced

Cast Boosters and

PETN in the productportfolio

Started exporting and

slowly gained

acceptance inInternational market.

Expands

Domestic

operations in 14

New Bulk Plants

StartsExports

in 25countries

Manufacturing

units in Zambia,Nigeria & Turkey

Expanded5

New BulkPlants

Sets up

Manufacturing

facilities of HMX& Propellant

Milestones

2015

Supplies to BDL & TBRL commences

Imported first

Cartridge

Manufacturingmachine from USA

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3

Regulatory Environment

One of the very few sectors needing

Industrial License

Clearance required from Home Ministry

License also required from Chief Controller

of Explosives, GoI

Clearance required from IB-regarding

safety of location & Directors

NoC required from District Magistrate

NoC by District Magistrate after

clearance by Police, PWD,

Grampanchayat

For underground (Gasy mines) use

permission required from DGMS

Bulk explosives Cartridge explosives Detonators Detonating Cord Cast Boosters

2,16,107 MT

Licensed capacity

Installed acrosslocations in India

Locational

proximity to themines

All units located

at 50-60 kms

radius from the

major mining

regions

Largestmanufacturing

capacity in

India

74,655 T

Largest cartridge

manufacturing

Facilityat a single

location in the

world

Licensed capacity

installed in

Nagpur

190 Mi Pcs.

Well poised to

cater to rising

demand from

Indian and

overseas mining

&

Infrastructure

Industries

Among the larger

Manufacturing

Capacities in India

75 Mi Mtrs.

Licensed capacity

installed in

Nagpur

Largest

Manufacturing

Facility in India

1500 MT

LargestManufacturing

Facility

in India

Product Range & Licensed Capacities

Licensed capacity

installed in

Nagpur

Licensed capacity

installed in

Nagpur

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Raw Material Management

• 70% of the total raw material consumed

• Domestically sourced from GNFC, RCF & Deepak Fertilizers

• Price volatility - rise/fall clause included in rate contract with customers to a large extent

• The domestic price is Rs. 25500per MT

• Total AN demand in India, for explosives, is ~6 Lakhs MT against a domestic production of ~5.5 Lakh MT

• An Prices are stable in India from last 1 Year

Key Raw Material – Ammonium Nitrate

Plants State Clients served

4 Maharashtra 1. Western Coalfield Ltd.2. SCCL

2 MP 1. Northern Coalfield Ltd2. Reliance power (sasan)

2 Chattisgarh 1. South Eastern Coalfiel Ltd.2. Jindal Power, Sharda energy,

Lafarge, Parsak (Adani group)

2 Jharkhand 1. Tisco2. Central Coalfield Ltd, Bharat

Coking Coalfield Ltd .

3 Odhisha 1. Mahanadi Coalfield Ltd.2. Tisco

2 AP 1.SCCL Ramagundam2.SCCL Kothagundam

2 Rajasthan Hindustan Zinc, Jindal Saw

1 West Bengal Eastern Coalfield Ltd

Existing facilitiesNewly acquired

Company has acquired 100% stake in Blastec (India) Private Ltd and EMUL-TEK Private Limited having bulk explosive plant at Waidhan and Raigarh.Nagpur facility supplies cartridge explosives and detonators all over India. The rest of the plants supply bulk explosives in their resp. states

Our Domestic Presence

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Global Reach & Presence

Facility :

Capacity of 5000 MT of

Cartridge & 10000 Mt of

Bulk.

• Our Share-65%

Facility :

Capacity of 10000 MT of

Cartridge & 20000 MT of

Bulk.

• Our Share-55%

Facility :

Capacity of 40000 MT of ANFO

and Nonel Assembly & 5000 MT

of Cartridge Plant

• Our Share-74.50%

Zambia Nigeria Turkey

Total Overseas Sales for FY15 is 335.32 Cr as compared to 232.85 Cr of FY14.

Market Dynamics

North America

25%

Latin America

12%

Western Europe

5%Eastern Europe

5%Africa

7%

Russia5%

China16%

India5%

South East Asia

7% Australia13%

Global Industrial explosives market

Major players

India is 8th largest & fastest growing Market globally

• Size of the market ~ Rs 4,500 cr.

• Historical growth 5-6 % p.a. (last 10

years)

• Future growth expected 7-8 % p.a ,

which can be 10% in 2 years.

• Annual Explosive consumption of ~ 9

Lakh MT in FY15

• Highly concentrated market with about

30 manufacturers in the industry

GLOBAL OVERVIEW DOMESTIC OVERVIEW

Major players

Solar Industries India Limited is the market leader in the country

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Domestic Dynamics

• Main drivers for explosives demand

• Mining

• Infrastructure development

• Mining industry is the major consumer of explosives. It accounts of 90 % of total explosives .

• Coal industry consumes 70 % of total demand.

• CIL is estimating a CAGR of 7% from FY13-17.

• CIL issues tender with reverse Auction with price escalation clause quarterly basis based on movement in prices of AN, Diesel and Labour index

• MMDR Amendments bill and Coal Mines (Special provision) bill are likely to open up mining sector in a big way

Annual Customer Bifurcation5

/29

/20

15

FY15 FY14

Coal India 437.71 379.26

Non CIL & Inst 241.85 157.85

Trade & Others 380.86 317.93

AN Trading 0.00 8.71

Export & Overseas 396.05 352.75

Total 1456.47 1216.50

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Our Journey in Numbers

Overseas

manufacturing in 3 countries

Nigeria, Zambia

& Turkey

Exports to 25+

countries

FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15

Revenue(Rs. Cr) 321 530 590 723 1031 1213 1216 1456

0

200

400

600

800

1000

1200

1400

1600Revenue

FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15

Volumes(MT) 86659 98024 113345 130086 161033 190091 175764 221638

0

50000

100000

150000

200000

250000

Volumes

+18% CAGR

+20% CAGR

+19% CAGR

Our Journey in Numbers

FY10 FY11 FY12 FY13 FY14 FY15

EBIDTA(Rs.cr) 112 148 195 210 232 262

0

100

200

300EBIDTA

FY10 FY11 FY12 FY13 FY14 FY15

PAT(Rs. Cr) 59 76 101 116 118.4 147.41

0

50

100

150

200PAT

FY10 FY11 FY12 FY13 FY14 FY15

EPS(Rs.) 34 44 58 65 65.78 81.45

0

50

100EPS

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Financials – P&L 5 yr CAGR

(Rs. Crs) FY10 FY11 FY12 FY13 FY14 FY15

5yr

CAGR

Gross Income 590 724 1031 1213 1216 145620%

Excise Duty 33 43 64 93 91 110 27%

Net Income 557 680 967 1120 1126 1346 19%

Material Consumed 328 372 561 650 591 769 19%

Material Consumed % 58.8 54.73 58.02 58.06 52.49 57.13

Other Costs 144 186 236 282 339 329 18%

Other Income 26 26 25 16 18 14 -12%

EBIDTA 112 149 195 197 214 262 19%

EBIDTA % 20.09 21.75 20.14 17.64 19.0419.47

PAT 59 76 101 116 118147

20%

PAT % 10.51 11.11 10.47 11.29 11.5 11.62

EPS (annualized in Rs.) 33.8 43.64 58.42 65.47 65.44 81.45 19%

Financials – B/S

(Rs. Crs) FY10 FY11 FY12 FY13 FY14 FY15

Gross Block 172.16 270.29 386.35 436.77 575.40 667.36

Cash & Bank Balance 93.98 59.63 63.01 92.19 133.01 37.27

Net Worth 261.2 316.04 404.6 572.7 661.57 775.88

Loan Funds 107.68 138.67 283.26 344.52 442.75 328.48

Capital Employed 302.46 397.27 621.67 868.29 1048.63 1063.86

Debt Equity Ratio 0.41 0.44 0.7 0.6 0.67 0.41

Inventory Days 42 58 84 76 94 78

Debtor Days 56 48 49 47 55 48

ROCE 34.43 35.44 29.26 22.23 18.34 21.66

RONW 22.43 24.35 25.01 20.31 17.9019.00

Working Cap days 147 87 102 132 144105

Book Value 144 172 224 316 366 431

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Our Growth will come from…

Increase exports of explosives existing as well as new markets

3. Renewed demand from Housing and Infrastructure revival

4. Introducing products for the defense sector

5.

Enhanced demand from coal, iron ore & LS mining: public + private

1. Good potential in overseas market.

2.

Specialty Chemicals for Defence Sector

Product Enquiry Qty Buyer Tenor Remark

HMX 10.0 MTOrdinance Factory,

Khamaria 1 Year Order expected in Q1FY16

HMX Compounded Producrt 0.5MT BDL 1 Year Supplied in FY 15

HMX 3 .0MT TBRL, Chandigarh 2 Years1.5tn supplied in Q4FY15

and 1.5tn to be supplied

HMX - Following Tenders / Enquiries have been received:

• Propellants – We have participated in Limited tender floated by Ordinance Factory, Chanda to supply 500 units of Pinaka Propellants.

• AKASH order for 300 nos. received .To be supplied in FY17

• Company has invested Rs 175.46Crs in defense project against the Planned Capex of Rs 220 Crs

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Shareholding

THANK YOU!!!

WE INVITE YOU TO VISIT OUR

MANUFACTURING FACILITIES

Nilesh PanpaliyaCFO

nilesh@solargroup.comwww.solargroup.com

We Thank you for your time

and

Invite You To Visit Our

Manufacturing Facilities

Nilesh PanpaliyaCFO

nilesh@solargroup.comwww.solargroup.com