288303523-hindalco-novelis-acquisition.pptx

case

1. HINDALCO’S ACQUISITION OF NOVELIS THE MAKING OF A GIANT

2. HINDALCO Incorporated in ABG Foil plant at Silvasa went onstream Acquired ISO14001 EMS certification Acquired Nifty copper mine 1958 Entered the Asia top 25 list of the CFO Asia Annual Report Survey Production started in Renukoot plant 1962 1998 1998 2000 Acquired 54.6% stake in Indal Started merging Indal with Hindalco 2001 2003 2004 2006 Entered JV with Almex COMPANY OVERVIEW KEY MILESTONES

3. NOVELIS Chartered as Northern Aluminium Company Ltd . in 1902 as a subsidiary of Pitsburg reduction Company(Alcoa) Alcan was formed as a separate company in 1928 to focus outside the United States Alcan expanded globally in 63 countries with an employee strength of 88,000. ALCAN NOVELIS Created as a spin off from Alcon to carry on most of its aluminium rolled products business The vision behind forming was to help the customers perform and transform new ideas into practical product solutions VISION: “ To help make the world a lighter, brighter and better place ” 2005 KEY FACTS ABOUT NOVELIS

4. Questions The objective of the acquisition of Novelis by Hindalco What were the short term impact of the acquisition What were the benefits to Hindalco

5. Motivations behind the deal Hindalco

6. Novelis Motivations behind the deal

7. What were the short term impact of the acquisition Non-cash unrealized gains on derivatives ( $10 MN) $21 MN Q1 FY 2008 Q1 FY 2009 Sales $2828 MN $3013 MN Pre-tax loss/income ( $114 MN) $62 MN Net loss/income ( $142 MN) $25 MN $176 MN in pre-tax income $31 MN Product Mix improvements contribution to Pre-Tax Earnings $33 MN Selling, General and Administrative Expenses $15 MN Interest Expenses $11 MN Input and Operational Costs (mainly energy, freight and alloy) $48 MN Costs associated with currency exposure (primarily Brazilian Real) $26 MN

8. What were the short term impact of the acquisition Hindalco Net Sales 213 % Profits 10.8 % Share Price Fallen in the ranges of Rs.120-130 after being traded as high as Rs. 199 Normalized Operating EBITDA increased 62% Free Cash Flow improvement: $ 164 M*

9. What were the benefits to Hindalco ?

10. What were the benefits to Hindalco ?

11. Group 3 Thank You G009 Gitankshi Bhatnagar G013 Tanay Chitre G019 Spandana G G020 Purva Ganediwal G026 Priyanshi Goel G029 Ankur Gupta G052 Harsh Shah