Sterlite Technologies Limited words and statements in this communication concerning Sterlite Technologies Limited ... The distribution of this presentation in ... 400/220 kV Substation

www.sterlitetechnologies.com

Sterlite Technologies Limited

Investor Presentation

May 2015


Disclaimer

Certain words and statements in this communication concerning Sterlite Technologies Limited (“the Company”) and its prospects, and other statements

relating to the Company’s expected financial position, business strategy, the future development of the Company’s operations and the general economy

in India & global markets, are forward looking statements.

Such statements involve known and unknown risks, uncertainties and other factors, which may cause actual results, performance or achievements of the

Company, or industry results, to differ materially from those expressed or implied by such forward-looking statements.

Such forward-looking statements are based on numerous assumptions regarding the Company’s present and future business strategies and the

environment in which the Company will operate in the future.

The important factors that could cause actual results, performance or achievements to differ materially from such forward-looking statements include,

among others, changes in government policies or regulations of India and, in particular, changes relating to the administration of the Company’s

industry, and changes in general economic, business and credit conditions in India.

The information contained in this presentation is only current as of its date and has not been independently verified. No express or implied

representation or warranty is made as to, and no reliance should be placed on, the accuracy, fairness or completeness of the information presented or

contained in this presentation. None of the Company or any of its affiliates, advisers or representatives accepts any liability whatsoever for any loss

howsoever arising from any information presented or contained in this presentation. Please note that the past performance of the Company is not, and

should not be considered as, indicative of future results. Furthermore, no person is authorized to give any information or make any representation which

is not contained in, or is inconsistent with, this presentation. Any such extraneous or inconsistent information or representation, if given or made,

should not be relied upon as having been authorized by or on behalf of the Company.

The Company may alter, modify or otherwise change in any manner the contents of this presentation, without obligation to notify any person of such

revision or changes.

These materials are confidential, are being given solely for your information and for your use, and may not be copied, reproduced or redistributed to any

other person in any manner. The distribution of this presentation in certain jurisdictions may be restricted by law. Accordingly, any persons in possession

of this presentation should inform themselves about and observe any such restrictions

2


Company overview


Sterlite Technologies: One of the leading global providers of

solutions in telecom and power transmission

4

FY15 Net Revenues*

Of the global top 10 telecos

Use Sterlite’s innovative solutions

Vedanta Group*

Shares the same lineage

as the

FY15 Consolidated EBITDA*

Consolidated revenues

are from international markets*

Business Lines

Operates in 2 Sectors

Telecom & Power

Full time Employee

Patents in USA, EU, India, China &

53 more under consideration

Locations India, China & Brazil

Global sales presence with

manufacturing locations in

* As of FY15 consolidated numbers


Key Markets

Major

competitors

Key FY15

Financials

(Rs. mn)*

Offering

• Optical fibers & preform

• Fiber optic cables

• Data Cables

• System integration and

FTTH solutions

• Power conductors

• HV/EHV cables

• OPGW

• T&D engineering solution

• 6 projects across 11 states

won through competitive

bidding on BOOM basis

• 5000 km circuit

transmission lines and 3

substations

• Europe, China and Middle

East

• America, Middle East, Africa

and Asia • India

• Corning (US) and Prysmian

(Italy)

• Apar Industries (India) and

Midal (Middle East)

• Power Grid (India) and L&T

(India)

• Revenue: 15,764

• EBITDA: 3,452

• Revenue: 14,730

• EBITDA: 352

• Revenue: 1,539

• EBITDA: 1,320

Telecom Power Products and Transmission Grid

* Consolidated financials before inter-segment eliminations

Our business verticals

5

Proposed to be demerged

Company Overview Way Forward Financials Demerger Update Appendix Telecom Business Power Business


Telecom

• Optical Fiber (Capacity: 20 mn fkm)–

Aurangabad(India) and Haimen, Jiangsu

Province (China)

• Optical Fiber Cable (Capacity: 8 mn fkm

being increased to 15m fkm)– Silvassa

(India) and Curitiba (Brazil)

Capacity being increased to 15mn fkm

• Structured data cables – Silvassa (India)

Power Products

• Conductors (Capacity: 1,60,000

tonnes) Silvassa (India) and Jharsuguda

(India)

• HV and EHV Cables Hairdwar (India)

Manufacturing Locations

• China - 75%:25% with Tongguang for

drawing optic fiber

• Brazil - 50:50 JV with Conduspar for

fiber cabling

Joint Ventures

Sales

Manufacturing

Market presence

Global presence ensures proximity to our clients

6

• China, India, Netherlands, Russia,

South Africa, Turkey, UAE, UK

Sales Offices

Services and Solutions

Telecom

• NFS Project execution in J&K

Power

• 6 Grid projects across 11 states in India



Evolution from products to an engineering company

7


• Incorporated

Copper telecom

cables Facility

1993


facility setup

• Optical fiber

facility set-up at

Aurangabad

2000

• Demerger from

Sterlite Industries

• Acquisition of power

conductors business

• Commencement of

Grid business

2010

• JV with TG for fiber

facility in China

• Set-up of EHV power

cables facility at

Haridwar

• JV with Conduspar in

Brazil for fiber cable

• Commissioned

India’s first UMTP (in

record 26 months)

2013

• Secured prestigious NFS

project to implement end

to end OF Network for

Defense services

• Added sixth UMTP project

1988 1995 2006 2012 2014

Erstwhile Sterlite Industries Sterlite Optical Technologies renamed to Sterlite Technologies

2015

• Demerger

Announced


STL offers a unique proposition

8

Unique opportunity to participate in the growth of the telecom and power sector in India as well as globally

Underlying industry dynamics are very attractive – telecom led by the exponential growth in data consumption

and power led by increase in per capita power consumption

Sterlite Technologies operates on a global scale – 20m fkm fully integrated optical fiber plant in India and

160,000MT for power conductors – capacities are well invested

Full control over the value chain by way of backward integration allowing for significant cost advantage

Sterlite Technologies offers complete end to end solutions for high speed data transmission and high voltage

power transmission

Strategic JV and tie ups with reputed partners globally led by a strong management team



Telecom Business


Products

• Optical fibers & preform


• Structured data cables

• Dedicated Center of

Excellence

• Low loss to bend Insensitive

Fibres

• For Long-Haul to Last Mile

communication

applications

Solutions

• System and network

integration

• End-to-end project

management

• Technology platform

deployment MPLS,

GPON, DWDM, etc.

• Core, metro and access

network

• Network engineering,

Roll out, Integration

and O&M

Key metrics (FY 15)

• Fiber volumes 17.7m fKm

• OF Cable volume 7.7m fKm

• Consolidated revenue of Rs.

15,764 mn

• EBITDA of Rs. 3,452 mn

Key Customers

• Global Telecom Service

• Internet Service Providers

• MSO/CATV Operators

• Govt. of India agencies

Our telecom business

10

Infrastructure

• Specialized team with

FTTH experience

• Build, Install, Own and

Manage

• Neutral access network

• Over 180,000 homes

connected across 8

major cities

Full control over the entire value chain

Raw materials

• Silica & Power

• Certain natural

gases

Preform

• Integrated

Core rod +

cladding

Optic fiber

• 16m fkm

drawing India

and 4m fkm

in China

OF cable

• Portfolio

catering to

diverse end

use

Solutions

• High speed

broadband

networks



Source : Industry Estimates

Various economies at

different stages of fiber

deployment should help

sustain global growth

Data consumption continues to grow fiber demand

11

Mobile data to grow 44% CAGR

vs 15% for fixed internet

62 75

95

118

140

173

189

218

245

263

297

0

50

100

150

200

250

300

350

400

450

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Mill

ion

Fib

er K

m

China India North America Europe Others World Total

62 76 91

110 132

0

50

100

150

200

250

300

CY 2014 CY 2015 CY 2016 CY 2017 CY 2018

'00

0 P

etab

yte/

mo

nth

Fixed Internet Managed IP Mobile Data

844

380 327

83 71 54

0

100

200

300

400

500

600

700

800

900

China UnitedStates

Europe India LatinAmerica

Africa

India as a market is under

fiberized – optical fiber cable

deployment in India in 1/10th

the cable deployed in China



Long term sustainable demand going forward

Leveraging the growth in India – Products to Solutions

12

Current project highlights

National Optic Fibre Network (NOFN)

• Secured largest share within the country for cable supply

Network for Spectrum (NFS)

• Turnkey deployment of network in J&K worth Rs. 16,500 mn and supply of cable worth Rs. 3,000 mn to other participants

Private Telco rollout

• Ongoing supply of OFC to RelianceJio, Bharti Airtel and other Indian operators

Infrastructure Solutions Products

Opportunities

To become an End-to-End Service Provider



Source : Company

Volumes (m fiber km) Order Book (Rs Mn)

2,000 3,450

21,876

24,000 23,000

21,000

-

5,000

10,000

15,000

20,000

25,000

30,000

Q3 FY14 Q4 FY14 Q1 FY15 Q2 FY15 Q3 FY15 Q4 FY15

Ord

er b

oo

k in

Rs

Mn

Resulting in improved volumes & order book

13



Power Business


Our power business

15

Products

• Full range conductors from

ACSR to high performance

conductors

• HV and EHV cables from

voltage grade of 6.6 kV to

220 kV

• Optical Ground Wire

(OPGW) that leverage core

expertise in power

conductors & fiber optic

cables

Solutions

• Engineering T&D

networks & re-

conductoring solutions

• Enhancing current

carrying capacity

• End-to-end project

management

• Engineering,

Integration, Roll out

and O&M

Key metrics (FY 15)

• Capacity : 160,000 MT

• Volume of conductor sold :

77,996 MT

• Consolidated revenue of Rs.

16,268 mn

• EBITDA of Rs. 1671 mn

Key Customers

• Central and Private sector

power utilities

• State Electricity Boards

• EPC contractors

Infrastructure

• Largest private sector

independent power

transmission company

in India

• 6 Projects in Portfolio

• $1.3 bn capital

commitment

• 5000 Km transmission

lines & 3 substations

across 11 states

Full control over the entire value chain

Raw materials Products Engineering Power Grids

• Aluminium

• Other alloys

• HV and EHV

product line

• Heli stringing and

live line

reconductoring

• Inter State

Transmission

networks



765 KV D/C

765 KV S/C

400 KV D/C

2x1500 mVA,

765/400 kV Substation

Dhule

Vadodara

Aurangabad

Indore

Bina

Bhopal

Jabalpur

Bihar

Sharif

Purnia

Siliguri

Bongaigaon

Dharamjaygarh

Kota

Shujalpur

Purlia

Ranchi

Kharagpur Chaibasa

5

4

2 1

3

6

400/220 kV Substation

Jalandhar

Amargarh

Note: Map is representative of project locations and transmission lines not to scale

Connecting key generating centers with load centers

Build-Own-Operate-Maintain (BOOM) Model with 6 Projects in Portfolio

o 5000 Km circuit transmission lines & 3 substations across 11 states

o Estimated capital expenditure of Rs 80,000 mn

o One project fully commissioned, all 6 to be commissioned by FY20

One of the lowest risk profiles as compared to other segments within the Infrastructure segment

o Fixed annuity model (35 years) with high quality of receivables that is not dependent on power flow

o Perpetual assets with minimum maintenance capex

o Assets have opportunity for additional revenue generation

SCPE has entered into agreements for a Rs. 5 bn equity investment - the first foreign investment into India’s power transmission sector

16



Project name States covered Other details Line length

(kms)

Expected

operation by

Approx. Level

Tariff (Rs Mn)^

East North

Interconnect Assam, Bihar & West Bengal 2 * 400 kV double circuit 450 Commissioned 1,180

Jabalpur

transmission

Chhattisgarh, Madhya

Pradesh

1 * 765 kV single circuit

1 * 765 kV double circuit 610 Jun-15 1,400

Bhopal – Dhule Madhya Pradesh,

Maharashtra & Gujarat

4 * 765 kV single circuit

2 * 400 kV double circuit

2 sub stations

990 June-15 2,000

Rajasthan Atomic

Power Rajasthan & Madhya Pradesh 1 * 400 kV double circuit 200 Mar-16 400

Purulia &

Kharagpur West Bengal &Jharkhand 2 * 400 kV double circuit 270 Mar-16 600

NRSS 29 Punjab & Jammu & Kashmir 3 * 400 kV double circuit

1 substation 440 Jul-18 4,400 6

5

4

3

2

1

^ Levelised tariff for 25 years for East North Interconnect project; 35 years for all other projects

Business Model

Pre-bid steps Execution Post COD

• Detailed route planning

• leverage in house engineering

capabilities

• Network planning and detailed

cost estimates

• Strong project management

• Use global vendors and

international best practices

• Monetization and asset rotation

• Financial engineering

Infrastructure project details

17



Order book for power segment (in Rs. Mn)

The India opportunity leading to a strong and diversified

order book

18

3,390 2,890 2,624 2,567 3,088 3,101

7,547 6,450 7,018

12,169 11,219 12,216

13,063

12,420 12,519

10,579 9,853

10,505

24,000

21,760 22,161

25,314 24,159

25,823

0

5,000

10,000

15,000

20,000

25,000

30,000

Q3 FY14 Q4 FY14 Q1 FY15 Q2 FY15 Q3 FY15 Q4 FY15

PGCIL Others Exports Total

Conducive macro environment

• Opportunity being driven by growth in generation

capacity and increased residential demand

• Policy changes transforming the Indian power sector

– more private sector participation opportunities

• Growth in renewable energy will increase demand for

T&D evacuation capacity

• A number of projects to be commissioned across

strengthening and capacity augmentation projects

• TBCB model for power transmission projects well

accepted and should become more widespread even

at state level

• Improving financial profile of participants in the

sector



Demerger Update


Restructuring to create focused pure play opportunities

20

Promoters

STL

Telecom division

Power Products division

Grid Projects subsidiary

Public shareholders

45.2% 54.8%

Standard Chartered PE

Demerger of power products

division and transmission grid

business undertaking

Sterlite Power Transmission

Ltd

100%

Current Structure Post Restructuring

Promoters

STL

Telecom Business

Public shareholders

45.2% 54.8%

Promoters

Sterlite Power Transmission Ltd.

(SPTL)

Power Products Business

Grid Projects subsidiary

Public shareholders

Standard Chartered PE

27.1% fully diluted 27.1% fully

diluted

STL*

Revenue : 1,619

EBITDA: 345

Net Debt: 674

SPTL*

Revenue : 1,478

EBITDA: 167

Net Debt: 4,207

Note : * In Rs Cr . Based on FY 15 consolidated basis , numbers are representative and have not been audited



Options for shareholders

21

5 shares

Option A

5 shares in STL

STL Telecom (Listed)

Value of share Rs 112.30 (based on 5:1 ratio) implying per share value of

STL at Rs22.46

SPTL (Unlisted equity)

1 RPS to be redeemed at the end of 18 months for Rs 125.80 with

dividend

SPTL Listed RPS Option B

SPTL Listed RPS Option C

1 RPS to be redeemed within30 days of Effective Date for Rs 112.30

Scheme offers multiple options to cater to investor’s preference

• Option A : Continue to hold equity shares and partner in the value creation

of the power sector

In case shareholder is unable to hold shares due to conflict with their investment

mandate then will be issued Redeemable Preference Shares (RPS)

• Option B : Provides a liquidity event at the end of 18 months

• Option C : Provides an initial liquidity window for 30 days

Note : * Representative for resident shareholders options for other shareholders and Promoters may be different and is covered in the scheme document



Financials


Net Revenue EBITDA & EBITDA Margin

Net Debt*

* Gross Debt – Cash – Inv

Cumulative contribution by STL in Transmission Projects

Rs.

Mn

R

s. M

n

Rs.

Mn

R

s. M

n

Our consolidated financials

23



Proforma financials

24

Standalone Consolidated

Tel Power Tel Power

Revenue 1,530 1,500 Revenue 1,619 1,478

EBIDTA 345 41 EBIDTA 345 167

EBITDA margin 23% 3% EBITDA margin 21% 11%

Depreciation 76 32 Depreciation 96 89

Interest 53 126 Interest 75 252

Cash Profit 292 (85) Cash Profit 270 (84)

Tax 54 (40) Tax 55 (52)

PAT 161 (77) PAT 118 (121)

EPS 4.09 (1.95) EPS 2.99 (3.08)

Net Worth 668 575 Net Worth 600 469

Borrowing 502 875 Borrowing 674 4,207

Total 1,170 1,450 Minority Investment in Grid Business 0 450

Investment in Grid Business - 1,197 Total 1,275 5,126

Fixed Assets 705 242 Fixed Assets 984 5,264

Net Fund Involvement 465 11 Net Fund Involvement 290 (138)

FY 2014-15 (Carve out) FY 2014-15 (Carve out)

Balance Sheet as on Mar 31, 2015 Balance Sheet as on Mar 31, 2015



Way Forward


Business strategy and way forward

26

Demerger to create a winning outcome for all – two pure play focused companies with flexibility to pursue growth

independently

• Maintain strong presence in the Indian market

• Deeper penetration in export markets

• Focus on increasing sales of high performance conductors

• Providing more value added turnkey solution opportunities

• Take advantage of the India opportunity – Products + Services

• Leverage our manufacturing capabilities and increase utilisation

• Continue to increase share of cabling in overall mix (38% in FY14 and

44% in FY15)

• Increase penetration in global accounts

Telecom Products and

Solutions

Power Products and Solutions

• Focus on execution of existing projects

• Selectively monetize and refinance assets post CoD

• Strategically continue to bid for transmission projects in India

Power Transmission Grid



Appendix


Anupam Jindal, CFO

(18 years experience)

• Joined the Sterlite Group in 1998 and is

Chartered Accountant from the ICAI

• His key focus areas have been Finance,

Treasury, Accounts and MIS.

K. S. Rao, COO – Telecom & Power

Conductors (21 years exp)

• Joined Sterlite in 1993 and holds a

Bachelor’s degree in Mechanical

Engineering

• His key focus areas have been

engineering, mfgr, product and

business development

Ajay Bhardwaj, COO – Grid Business


• Joined Sterlite in 2011

• Worked in senior capacities in various

organisations ion projects in T&D,

Energy Management Systems.

• An electrical Engineer from IIT-Roorkee

Dr. Anand Agarwal, CEO


• Joined Sterlite in 1995 and B. Tech. in

Metallurgical Engineering from IIT-

Kanpur, Masters and Ph.D. from the

Rensselaer Polytechnic Institute, USA

Pravin Agarwal, Whole time Director

(30+ years experience)

• Closely involved with the Sterlite

Group’s operations in India since its

inception

• Has rich experience in general

management and commercial matters

Rajendra Mishra, COO - Power Cables


• Joined Sterlite in 2008 and holds a

Bachelor’s degree in Electrical and

Electronics Engineering from REC,

Suratkal

Pratik Agarwal Head-Infrastructure

Business (10+ years experience)

• He leads strategic business initiatives in

the infrastructure ownership space

• Completed his B.Eco from Wharton,

Pennsylvania and MBA from London

Business School

Ankit Agarwal Global Head - Telecom

Products (7+ years experience)

• Also responsible for identifying and

executing strategic opportunities

globally for Sterlite

• Holds a Bachelor’s degree from Univ. of

Southern California and MBA from

London Business School.

Pankaj Priyadarshi, CCO – SCM

(28 years of experience

• Joined Sterlite in 2012 and has completed

Mechanical Engineering from BITS Pilani

and a course on Strategic Sourcing

Management from IIM-Ahmedabad.

Professional Management Team

28



Scheme highlights

29

• April 01, 2015 Appointed

Date

• For every 5 equity shares held in STL, retain 5 shares of STL + option to receive either:

– One equity share of face value Rs 2/- in SPTL; or

– One Redeemable Preference Shares (RPS) of face value of Rs 2/- each in SPTL with a dividend of 8% of

Face value per annum. The RPS can be redeemed for cash of Rs 125.80 per RPS with dividend after 18

months from allotment, alternative window to sell within 30 days of allotment to promoter or any

other entity appointed by promoter’s for Rs 112.30

Share

Entitlement

Ratio

• The demerger would be compliant with section 2(19AA) of the Income Tax Act

• Equity shares of Sterlite Power Transmission Ltd. is proposed to be kept unlisted

• RPS of Sterlite Power Transmission Ltd. are proposed to be listed

• Exit Options, as per Scheme will be made available to public shareholders

Other Key

Details

• Expected to complete by Q4-FY16

• Shareholders, Creditors, SEBI and Stock Exchanges, Bombay High Court, RBI and other applicable

regulatory authorities, if any

Timelines &

Approvals

• SPTL valued at Rs 885crore which is at the higher end of range 804crs to 885cr

• Implied value of demerged undertaking Rs 22.46 per share

• Valuation based on the independent valuers report issued by Price Waterhouse & Co. LLP and Haribhakti

& Co

Valuation



Options for public shareholders

30

• Options:

– Receive equity shares of SPTL , or

– Receive Redeemable Preference Shares (RPS) of SPTL and seek cash exit

from redemption of RPS after 18 months, or

– Sell RPS of SPTL to promoters and / or their affiliates within 30 days of

allotment

• Note:

– Where no option is exercised by a shareholder, the resulting company

will issue and allot equity shares as per the entitlement of such

shareholder

Resident shareholders of STL

• Receive equity shares of SPTL and sell shares of SPTL to promoters and / or

their affiliates

Non-Resident shareholders of STL#

(excluding FPIs and GDR holders)

• Options:

– GDR holders acting through their depository shall compulsorily sell to

promoters and / or their affiliates the equity shares of SPTL that they are

entitled to receive

– The merchant banker appointed by SPTL shall sell the equity shares and

distribute cash thereof to the GDR holders, net of withholding tax

GDR holders

Note: #If RBI approval is not received before the Effective Date, FPIs acting through a merchant banker appointed by SPTL will receive equity shares of SPTL. The merchant

banker shall sell the equity shares and distribute cash thereof to the FPIs, net of withholding tax. Where no option is exercised by a shareholder, the resulting company will

issue and allot equity shares as per the entitlement of such shareholder and such equity shares will be sold and cash proceeds will be distributed thereof, net of withholding tax

Foreign Portfolio Investors (FPI)*

• Options:

If RBI approval received

– Receive unlisted equity shares of SPTL which shall be compulsorily sold to the

promoters and / or their affiliates , or

– Receive listed RPS of SPTL and seek cash exit from redemption of RPS after 18

months, or

– Sell RPS of SPTL to promoters and / or their affiliates within 30 days of

allotment

If RBI approval not received

– FPIs acting through a merchant banker appointed under the Scheme will

receive equity shares of SPTL. The merchant banker shall sell the equity shares

and distribute cash thereof to the FPIs, net of withholding tax


Documents

Sterlite Technologies Limited words and statements in this communication concerning Sterlite Technologies Limited ... The distribution of this presentation in ... 400/220 kV Substation