SuperAlloy Industrial Investing for a Brighter Future

Executive Summary

We are the global No. 1 aluminum alloy automotive wheel supplier for luxury

and premium automobiles. We design and manufacture forged wheels and

suspension parts.

We sell to Tier 1 luxury and premium car brands, who are growing faster than

the overall market. The global trend towards lightweight vehicles is an additional

tailwind for our business.

To enrich our product offering, we have invested in state-of-the-art plants with

major customer certifications to be acquired by 2019. We are also investing in

automation to enhance efficiency.

We are committed to achieve 15% ROE after new capacity ramp up and aim to

maintain a 40% dividend payout ratio.

2

Contents

3

1 Global No. 1 Aluminum Forged Wheel Supplier for

Luxury and Premium Automobiles

2 Industry Trends Favor Growth in SAI’s Business

3 The SAI Vision for Future Growth

4 Financial Summary

5 Appendix

Global No. 1 Aluminum

Forged Wheel Supplier

for Luxury and Premium

Automobiles

/ 11 4

SAI – A Lightweight Metal Engineering Expert

5

We specialize in the manufacture of lightweight alloy products for the automotive industry

Forged wheels products have historically been our key sales and profit driver

Forged wheels

76.2% sales Suspension parts/others

20.4%/3.4% sales

Source: SAI

NT$mn

Tier-One Supplier to Top Global Brands 17 years of design and manufacturing experience

Top 3 Clients are Jaguar Land Rover (JLR), Fiat Chrysler (FCA) and BMW.

6

2001

2004

2006

2007

2008

2009

2010

2011

2012

2013

2015 2017

2016 2018

Efficient Growth in Scope and Scale

New plants in

Germany & TW

1994

Established Aluminium

forged wheels

GM Supply

Contract

Enter

suspension

parts business

JLR Supply

Contract Enter aircraft

component

business

2000 2001 2011 2012 2013 2017

Listed on TW

Emerging

Board

2006

*Current no. of employees: 1,460.

Source: SAI and TEJ

7

$97

$122 $124 $127

$154

$172 $170

$0

$20

$40

$60

$80

$100

$120

$140

$160

$180

$200

$0

$50,000

$100,000

$150,000

$200,000

$250,000

$300,000

2011 2012 2013 2014 2015 2016 2017*

Sales (USDk LHS) Sales per employee (USDk RHS)

Global Sales Offices and Warehouses To support our brand customers, SAI has set up global sales, painting lines and warehouses, providing a

consistently high level of service quality and supply reliability.

Overseas Offices Warehouses Plants

Detroit, USA

Düsseldorf, Germany

Loßburg, Germany

Coventry, UK

Kunshan, China

Shiyan, China

Detroit, USA

Los Angeles, USA

Rotterdam, Netherlands

Coventry, UK

Melbourne, Australia

Kunshan, China

Shiyan, China

Yunlin, Taiwan

Pintung, Taiwan

Stuttgart, Germany

8

Industry Trends Favor

Growth in SAI’s Business

/ 11 9

Premium Segment is Outgrowing Overall Market

SAI focuses on high-end forged wheels of super car, luxury and premium brands.

Premium, luxury and super car shipment growth (mid-single digit growth y-y) to outgrow

global automotive market (low–single digit y-y).

US$9k to upgrade from 19” standard wheels to

21” high-end optional wheels

Porsche Panamera, Germany

*Yellow highlights are SAI customers. Source: SAI

10

2016 Shipment (k) 2017 Shipment (k) y-y

Mercedes 2,084 Mercedes 2,289 10%

BMW 2,003 BMW 2,088 4%

Audi 1,871 Audi 1,878 0%

Lexus 678 Lexus 652 -4%

JLR 576 JLR 621 8%

Volvo 534 Volvo 572 7%

Cadillac 309 Cadillac 356 15%

Porsche 238 Infinity 246 7%

Infiniti 230 Porsche 246 4%

Acura 161 Acura 155 -4%

Sub total 8,684 Sub total 9,104 5%

2016 Shipment (k) 2017 Shipment (k) y-y

Ferrari 8 Ferrari 8 5%

McLaren 3 McLaren 3 2%

Rolls-Royce 4 Rolls-Royce 3 -16%

Bentley 11 Bentley 11 1%

Sub total 26 Sub total 26 -1%

Total Shipment (k) 8711 9130 5%

Top 10 premium cars

Super/Luxury cars

0

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o

2016 Avg. aluminum content (kg)/car

Avg. aluminum

content/car: 150.6kg

Premium & Luxury Cars Use Aluminum to Reduce Weight

Premium and luxury sedans, full & mid-size luxury SUVs and sport cars use more aluminum

components than automobiles targeted at the mass market.

Source: European Aluminum forecast

Aluminum intensive cars

(>300kg. Avg. 412kg)

Below Avg. aluminum

content/car

11

Industry Trends Create Multiple Growth Opportunities

Government policies mandate lighter cars for energy conservation and CO2 emissions reduction.

2025 U.S Corporate Average Fuel Economy (CAFE) target is 23km/l vs. current 12km/l.

The rise of aluminum parts: Average aluminum content per car is projected to grow +3% y-y till 2025.

1kg reduction in wheels/suspension parts equals 5~8kg reduction in other parts, so even

mainstream market cars will increase their use of Aluminum parts to meet CAFE.

EV and sharing vehicles target the use of aluminum parts for weight reduction and energy efficiency.

150.6 168.8

196.2

0

50

100

150

200

250

2016 2020F 2025F

Average aluminum content (kg)/car

Source: European Aluminum forecast 12

SAI Competitive Edge

High Entry

Barriers

RD and

Design

Capabilities

Customer

Portfolio

Operation

Efficiency

13

Technology and

capex intensity

Available capacity

Long qualification

period: at least 2~3

years

From aluminum,

magnesium to

composite material

wheels

Manufacturing

process development

Specialized in short

production run orders

with a high level of

customization.

Europe, U.S and

Asia luxury and

premium car brands

Co-design with

distinguished global

car brand studios

Before painting

process yield is

high-ninety %

New plants to

shorten cash

conversion cycle

Experienced Management Team

14

Name Position Function Years in

Industry Education/Experience

Tsung-Jung

Huang Chairman/CEO

Creating and implementing the

organization's vision and overall direction 40 ￭ Feng Chia University, TW

Dr. Ralph-R.

Ohlsen Executive VP European sales and marketing 33

Ph.D., Economics, Universität zu Kö ln, Germany

Associate Partner, Magna Steyr President, BMW Thailand

Manager, BMW supply chain mgmt.

Dr. Gilbert Kao VP, Labor and

Safety

Educate skilled labor and maintain good

working environment to enhance work force 30

￭ Tsing Hua University , TW

￭ GM, S-Tech Corp. (1584 TT)

Allan Wu Director, Global

Sales

Responsible for product sale and marketing,

managing overseas sales team 12 ￭ Drexel University, USA

Ben Huang VP,

Administration

General management of German production

and sales 16 ￭ Chung Hsing University, TW

Steven Kuo Director, Quality Responsible for quality control and product

assurance 20 ￭ Taiwan University, TW

The SAI Vision for Future

Growth

/ 11 15

The SAI Vision

1 Expand Market Presence in

Suspension Systems

2 Investments to Enhance SAI’s

Position as the Industry Leader

3 Improving Long-Term ROE

16

16

Increased Product Reach, Expanded TAM

17

Source: Research and Markets and SAI

US$51bn

Aluminum Suspension Wheel Units

US$1bn

Near Net & Net Shape Forged

Wheels

US$500mn

Fully-Machined

Forged Wheels

Fully-Machined Forged Wheels

Continue to make market share gains in the growing super car

and luxury car markets

In 2017, SAI shipment accounted for 35% of global fully-

machined forged wheels market.

Near Net & Net Shape Forged Wheels

This product targets the large volume premium car market.

In 2017, SAI shipment accounted for 1.5% of BMW 2mn cars.

Aluminum Suspension Wheel Units Strategically target EV application products

The US$51bn Automotive chassis market is projected to grow at

5% pa through 2025

Total Addressable Market

Net & Near Net Shape Solutions – Extending our Competitive Edge

18

Our net and near net shaped wheels utilize precision forging to shorten post-forging processes

Simplifies the production process, leading to lower production costs

They are optimal for large volume orders from premium brands

We expect the higher order volumes to increase plant output/utilization, leading to higher asset turns

Source: SAI

Fully-Machined Forging Net & Near Net Shape Forging

Rim type Super high end Luxury and Premium

Forging

process

Shorter, cheaper and less exact mold More exact mold with higher tooling

costs

CNC machining

time

Longest and requires the most plant

floor area for CNC machines

Reduced need for machining

Material costs High Less

Advantages Enhanced design options

Best Appearance and precision

Small volume orders

Lower production costs

Stable quality with high automation

Large volume orders

Expanded Presence in Suspension Components Will

Reinforce Core Business Momentum

Suspension Business

Synergies with

Wheel Business

Access to car brands core

suspension design spec,

enhancing wheel R&D and

design capabilities

Improve factory utilization and

shorten cash conversion cycle

Sharing of production

processes.

Including knuckles, control arms,

ball joints, brake systems and

corner module assembly

Longer production runs, high

volume and longer order visibility

Gain more share in luxury and

premium car brands

19

Plant Investment to Raise Efficiency and Enhance Customer Service

Industry

Leader

Economies of Scale

Provides the ability to support both small and large volume orders

Allows for more flexible capacity allocation among wheels and suspension parts

Stuttgart Painting Facility

For inventory management and

proximity to European auto plants

Aluminum

Recycling

Facility

40,000 tonnes per

year capacity will

reduce raw material

costs

Further

Investment in

Automation

To improve efficiency

and profitability at

original Yunlin facility

20

Our Strong Moats

Global Client Base

Geographically diversified client portfolio

Reduces single market risk, lends to sustainability in cash flows

Full Spectrum of Forging Skills

Allows expansion into a higher volume niche of the wheel market

Innovative manufacturing R&D

Availability of Certified Capacity

Accumulated MFG Process Experiences

Our library of wheel designs is based on 17 years of accumulated

materials science, industrial design and testing experience

Process guidelines lead to higher yield

21

The right capacity at the right time

Competitors need a minimum of 2 years to add new capacity and

another 1-2 years to achieve certification

Our Manufacturing Processes Refinement

Alloy

Design

New aluminum recycling

facility to strengthen alloy

design and material

science R&D

Grain

Refinement

Grain refining to

decrease grinding/

polishing process and

enhance quality

Improve

Efficiency Improve material

usage efficiency

by 20%

22

Financial Summary

/ 11 23

24

Source: Capital IQ and Bloomberg

Key Financial Performance

33% 30%

36% 33% 32%

22% 20%

26% 23%

19%

0%

10%

20%

30%

40%

2014 2015 2016 2017 1H18

GPM OPM

$5 $5

$8

$6

$3

22%

18%

25%

16% 18%

0%

5%

10%

15%

20%

25%

30%

$0

$2

$4

$6

$8

$10

2014 2015 2016 2017 1H18

EPS (NT$) ROE (RHS)

47%

39% 42%

37%

52%

1.8% 1.6% 1.1% 3.8% 4.3%

$0.0

$0.5

$1.0

$1.5

$2.0

$2.5

$3.0

$3.5

0%

10%

20%

30%

40%

50%

60%

2014 2015 2016 2017 1H18

Payout % Yield % Dividend per share (NT$ RHS)

NT$mn

2014-1H18 Income Statement

25

NT$ million 2014 2015 2016 2017 1H18

Sales Revenue 5,022 6,823 7,704 7,391 3,318

Gross Profit 1,672 2,060 2,769 2,460 1,049

Operating Profit 1,106 1,386 1,993 1,722 631

Income before tax 1,155 1,224 1,996 1,476 900

Net Income 1,026 950 1,603 1,148 676

EPS (NT$) 5.2 4.8 8.1 5.8 3.4

Y-Y (%)

2015 2016 2017 1H18

35.9 12.9 -4.1 -12.8

23.2 34.4 -11.2 -21.5

25.3 43.8 -13.6 -34.8

6.0 63.1 -26.1 9.4

-7.3 68.7 -28.4 12.8

-7.5 68.7 -28.4 13.2

Gross Margin 33.3% 30.2% 36.0% 33.3% 31.6%

Operating Margin 22.0% 20.3% 25.9% 23.3% 19.0%

Net Margin 20.4% 13.9% 20.8% 15.5% 20.5%

ROE 21.7% 18.0% 24.7% 16.3% 18.1%

Source: Capital IQ and Bloomberg

2014-1H18 Balance Sheet

NT$ million 2014 2015 2016 2017 1H18

TOTAL ASSETS 8,773 10,370 14,127 16,485 17,033

Cash 682 946 1,973 2,637 2,081

NR & AR 928 1,057 1,093 949 1,055

Inventory 1,937 2,379 3,047 3,707 4,139

Fixed Asset 4,455 5,227 7,020 8,629 9,090

TOTAL LIABILITIES 4,038 5,079 7,600 9,411 9,922

Bank Loans 3,118 3,862 6,322 8,076 8,087

AP 144 83 103 78 159

TOTAL EQUITY 4,735 5,291 6,527 7,074 7,110

A/R turnover days 58 53 51 50 59

Inventory

turnover days 181 165 201 250 285

A/P turnover days 84 68 74 84 89

Cash conversion cycle 155 150 178 216 255

Y-Y (%)

2015 2016 2017 1H18

18.2 36.2 16.7 6.4

38.8 108.5 33.7 -32.3

13.9 3.3 -13.2 -9.9

22.8 28.1 21.6 27.6

17.3 34.3 22.9 25.4

25.8 49.6 23.8 4.7

23.9 63.7 27.5 9.5

-42.1 24.3 -24.7 23.6

11.7 23.4 8.4 8.9

Source: Bloomberg and SAI

26

Appendix

/ 11 27 27

Diversified Board Members Enhancing Corporate Governance

28

Name Independency Expertise/Experience Years in

Industry Education

Tsung-Jung

Huang

Non-independent

director Chairman, CFO, investments 40+

￭ International Business, Feng Chia

University, TW

Dr. Chung-Jen Fu Non-independent

director

Management Accounting,

Business Valuation & Analysis 20+

￭ Ph.D., Accounting, National Chengchi

University, Taiwan

Long-Cheng Wei Non-independent

director

Senior executive and

operations 30+

￭ Chemical Engineering, National

United University, TW

Te-Hsing, Chen Non-independent

director Investment 30+

￭ National Dajia Industrial High School,

TW

Chien-Chung, Chu Non-independent

director

Engineering and

Semiconductor industry 15+

￭ Ph.D., Electrical Engineering,

National Taiwan University, TW

Chih-Hsiang,

Chang

Non-independent

director IT industrial 15+

￭ Computer Science and Information

Engineering, Da Yeh University, TW

Ting Wang Cheng Independent director Financial and accounting 30+ ￭MS, Accounting, University of Missouri,

USA

Mao Lin Shih Independent director Legal, government and public

Policy 30+

￭ College of Law, National Taiwan

University, TW

Fong Ren Jian Independent director Senior executive and IT

industrial 30+

￭ Ph.D., Materials Engineering, Brown

University, USA

Global Manufacturing Plants SAI has two Taiwan manufacturing sites and a Germany painting site. Below are our 2019E capacity:

4Q19 mass production:

Forging and Machining

Polishing and Painting

Test lab

Yunlin, Central Taiwan

Front-end capacity: 700k pcs/year

99,065 m2

Pingtung, Southern Taiwan

Front-end capacity: 300k pcs/year

98,660m2

Germany site

Painting capacity: 100k pcs/year

7,000 m2

Headquarter

Forge line

CNC machining

Mold/Tooling plant

Test lab

Painting

Warehouse

3Q17 mass production

29

World-class Manufacturing Efficiency

30

8,000 ton forge

7,000 ton forge

Horizontal flow forming

Vertical flow forming

T4 heat-treatment

T6 heat-treatment

CNC machines

Turning

Milling

Diamond cut

Manual grinding

Robotic grinding

CNC polishing

STD polishing

Dynamic polishing

Ceramic polishing

Manual painting

Automated painting

Masking

Powder paint

Liquid paint

Forging Painting Polishing Machining

SAI Al forged wheels production processes

We provide the best forged wheels manufacture and services by:

Design, customized spec and pre-production support

Before painting process yield is high-ninety %

Strict material, functional and environmental testing ensuring safety and quality

A Recent Example of an Order Win with Near Net Capability

31

Source: SAI and Porsche

SAI Net & Near Net Shaped forged solutions have been qualified for Porsche’s flagship models.

Our Germany painting site provides localized service and quick response to customer requests,

enhancing their inventory management.

Near Net Shape

Semi-finished rim

Machining, polishing and local painting

Porsche Panamera

and 911 GT3 forged rims

Extensive Testing Ensuring Safety and Quality

Material Testing Environmental Test Functional Testing

Rotary Fatigue

Radial Fatigue

13 Degree Impact

Bending Fatigue

Radial Fatigue

30 Degree Impact

Bi-axial Test

Salt Spray

CASS

Filiform Corrosion

Thermal Shock

Water Resistance

Chip Resistance

Gasoline Resistance

Cycle Crack, Solvent Rub,

Color and Xenon

Metrology Measurement

CMM

ARL spark O.E.S.

Brinell hardness

Vicker hardness

Rockwell hardness

Tensile

Metallography microscope

Fatigue Material Test

Complete quality system and professional safety laboratory testing.

Develop QA technology, testing processes and accumulate related big data.

Continuous improvement to achieve higher quality standards and better services.

SAI wheels adhere to international standards, including JWL VIA and INMETRO.

32

SAI Design & FEA Capability

Simulation ability CAD/CAM CAE

ABAQUS 6.14

HYPER Works 12

LS Dyna 7.1

Fe-safe V6.5

UniGraphic NX (CAD/CAM) NX10

I-DEAS (CAD) 12

CATIA (CAD) V5-6 R2014

Pro/E (CAD/CAE) 4.0

AutoCAD 2011

Master Cam (CAM) X4

Power Mill (CAM) 2015

Radial & Rotary Analysis

Impact Analysis

Stiffness Analysis

Natural Frequency

33

Research & Development Capability

Fields of research Cooperation Long-term R&D

Lightweight materials

Forging processes

Heat treatment

Machining

Surface treatment

Composite materials

Universities

Research Institutes

Partners

Parameters of Automobile

Wheel/Suspension Products

Lightweight Materials

Development

Design and Development of

Structural

Automation Equipment

Development

34

Our Industry and Research Partners

A Win-Win strategy through industrial and research institution collaboration in material science, manufacturing processes and product development.

35

Thank You

/ 11 36 36

Disclaimer

37

• The information contained in this confidential document ("Presentation") has been prepared by SuperAlloy Industrial Company Ltd. (the "Company"). It has

not been fully verified and is subject to material updating, revision and further amendment.

• While the information contained herein has been prepared in good faith, neither the Company nor any of its shareholders, directors, officers, agents,

employees or advisers gives, has given or has authority to give, any representations or warranties (express or implied) as to, or in relation to, the accuracy,

reliability or completeness of the information in this Presentation, or any revision or supplement thereof, or of any other written or oral information made or

to be made available to any interested party or its advisers (all such information being referred to as "Information") and liability therefore is expressly

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injury of the Information or for any of the opinions contained herein or for any errors, omissions or misstatements or for any loss, howsoever arising, from the

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• This Presentation includes certain statements that may be deemed “forward-looking statements”. All statements in this discussion, other than statements of

historical facts, that address future activities and events or developments that the Company expects, are forward-looking statements. Although the Company

believes the expectations expressed in such forward-looking statements are based on reasonable assumptions, such statements are not guarantees of future

performance and actual results or developments may differ materially from those in the forward-looking statements. Factors that could cause actual results to

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