ACC Ltd — Investor Presentation 2021

Jul 19, 2021

ACC Limited Registered Office Cement House 121, Maharshi Karve Road Mumbai - 400 020, India

CIN: L26940MH1936PLC002515

Phone: +91 22 3302 4321 Fax: +91 22 6631 7458 www.acclimited.com

No. ACC/Sec./SE/21/051 July 19, 2021

National Stock Exchange of India Limited Exchange Plaza, 5th Floor Plot No.C/1, G Block, Bandra Kurla Complex, Bandra (East), Mumbai 400 051 Tel.: 2659 8235/36 8458 Scrip Code: ACC

BSE Limited Corporate Relations Department P.J. Towers, Dalal Street Mumbai 400 001 Tel.: 2272 8013/15/58/8307 Scrip Code: 500410

Dear Sirs,

Sub: Regulation 30 of SEBI (Listing Obligations & Disclosure Requirements) Regulations, 2015 – Investor Presentation

In terms of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and other applicable provisions, please find enclosed the Investor Presentation Q2CY21 Results.

The said Investor Presentation will be simultaneously posted on the Company's website at www.acclimited.com.

You are requested to take note of the same.

Yours Sincerely For ACC Limited

Rajiv Kumar Choubey

Digitally signed by Rajiv Kumar Choubey DN: c=IN, o=Personal, title=0497, pseudonym=355818b29ebc96f8e3794dc90a1c3388eef74e 44c92b657a9ba9c2b0e890f4b2, postalCode=400054, st=Maharashtra, serialNumber=025caabe7cb51d29f8808c05f530001a06f46 5f207bd5b2421e9c8ac305140e1, cn=Rajiv Kumar Choubey

Rajiv Choubey Chief Legal Officer & Company Secretary ACS-13063

Date: 2021.07.19 18:10:56 +05'30'

Encl.: As Above

Investor Presentation : Q2 2021

July 2021

Stock code: BSE: 500410 | NSE: ACC | Reuters: ACC.NS | Bloomberg: ACC:IN

Safe Harbour Statement

• This presentation has been prepared by the Company based on information and data which the Company considers reliable, but the Company makes no representation or warranty, express or implied, whatsoever, and no reliance shall be placed on, the truth, accuracy, completeness, fairness and reasonableness of the contents of this presentation. This presentation may not be all inclusive and may not contain all of the information that you may consider material. Any liability in respect of the contents of, or any omission from, this presentation is expressly excluded.
• Materials and information provided in this presentation may contain 'forward-looking statements'. These statements are based on current expectations, forecasts and assumptions that are subject to risks and uncertainties which could cause actual outcomes and results to differ materially from these statements.
• Such statements may be subject to a number of risks, uncertainties and other important factors, such as but not limited to (a) competitive pressures; (b) legislative and regulatory developments; (c) global, macroeconomic and political trends; (d) fluctuations in currency exchange rates and general Financial market conditions; (e) delay or inability in obtaining approvals from authorities; (f) technical developments; (g) litigation; (h) adverse publicity and news coverage, which could cause actual developments and results to differ materially from the statements made in this presentation.
• The Company undertakes no obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise.

Index

ACC at a Glance

• Economy & Sector Update
• Strategic Priorities
• Performance Review

ACC at a Glance

Partner in India's Progress

ACC has emerged as one of the front-runners in India's building materials market with a pan-India presence

Consistently set new benchmarks with our relationship -first approach, breakthrough innovation and commitment to long-term sustainability

Legacy of active contribution to India's progress spanning over eight decades

Focused on retail (contributes ~80% of revenue), driven by a robust distribution network

A brand that inspires confidence among customers and other stakeholders

34.45 MTPA

Installed cement capacity

Vision

To be one of the most respected companies in India; recognised for challenging conventions and delivering on our promises

Purpose

To be a driving force in creating a confident future for our people, our customers, our shareholders and our nation

Sustainable Value Creation through Scale and Innovation

Delivering Results through Optimization

Focus on Premiumization through special application cements like Gold Water Shield,F2R Superfast;

Strengthening brand positioning through enhanced consumer connect

RMX – ECOPact (the advanced low Co2 concrete

solution) launched PAN India and scaled up

Parvat – Efficiency measures such as clinker factor optimization, reduction in energy consumption, lead distance reduction, leveraging Master Supply Agreement

Industry leading CO2 emission; Continuous focus on Municipal Solid Waste and Refuse Derived fuel to drive TSR (Thermal Substitution Rate) journey

Strong performance in Accounts Receivable and Inventory,

Working capital continues to stay negative, despite pandemic challenges

Digital marketing leveraged to generate higher leads; Adoption of digital assets viz. Dealer Connect, Contractor Loyalty; Digital Profiling of end consumers

significantly

Economy & Sector Update

GDP Growth likely to see a Sharp Rebound

• GDP forecast at 9.5% for fiscal 2022 (April'21 to Mar'22)
  • Largely on account of low base
  • Budgetary focus on capex to support growth in short term and also create platform for medium term growth
• India's GDP growth is expected to see base effect driven 'sharp rebound' until fiscal 2023
• In fiscal 2023, growth expected to remain strong and become more broad-based, as a sufficient proportion of population gets vaccinated by then
• Inflationary pressures persist: food inflation remains volatile, core inflation sticky

Source: S&P Global (June 2021), Global outlook is for calendar year (FY21= 2020 for World), NSO, CRISIL

Source: Crisil

Sectoral Outlook

Housing

• Second wave of pandemic impacted cement demand
• 19.5mn rural houses are targeted for construction between FY20 and FY22, with completion rate at~32%
• The budgetary allocation towards PMAY-U scheme for 2021-22 is Rs 8,000 crore.

• Continued Govt. focus on infrastructure through increased budgetary allocation towards roads- NHAI & PMGSY
• Significantly higher budgetary allocation of Rs. 2.15 trillion to railways sector compared to previous budget
• Capital expenditure by State governments is also expected to keep infrastructure demand momentum healthy

Infrastructure Industrial /Commercial

Industrial construction demand to witness revival supported by:

• Deferred investments from last fiscal flowing into fiscal 22
• Large players announcing capex plans
• Implementation of time bound Production Linked Incentive scheme

Strategic Priorities

Accelerating our Journey Forward

Ametha Integrated Project WHRS Projects Cost Efficiency Projects

▪ Capacity expansion project at Ametha in Madhya Pradesh and associated grinding units have commenced

• Jamul (10 MW)
• Kymore (14MW)

Projects on track and likely to be commissioned by Q2 2022

• Wet Flyash dryer installation at Kymore, Gagal & Wadi on fast track
• Geocycle Projects
• o Chanda commissioned in Jun'21
• o Jamul & Kymore feasibility in progress

Innovation Engine Chugs Ahead

• Various environment friendly products under development, targeting:
• o Water saving by > 50%
• o CO2 footprints reduction by > 80%
• o Zero Clinker Binder

• ECOPact Low Carbon Positive Impact
• o Rolled out Pan India; Excellent Volume Ramp-up
• o Appreciated by Green conscious customers

Green Cement ECOPact Admixture and Other Products & Solutions

• Cost effective Concrete Admixture developed in RMX
• o Ongoing supply at various RMX plants
• o Further expansion to Central India
• Cool walls : Special additive developed in Powder & Liquid form for performance enhancement

Leveraging Digitization to bring Efficiencies

Manufacturing - Plants of Tomorrow Logistics & Sourcing Commercial

• TIS (Technical Information System) & PACT (Performance & Collaboration Tool) implemented across plants
• Drones Pilot project done
• Cement Fineness Prediction projects
• VRM (vertical roller mill) Failure Prediction
  • Pilot project ongoing

• TAC (Transport Analytic Center) : Dashboard on secondary lead analysis & direct dispatch implemented
• Blue Yonder Sales & Operations Planning (S&OP)
• Digitizing the process from EPOD to transport invoicing

• Adoption of digital assets
• o Dealer Connect: > 80% of volume being channeled
• o Contractor loyalty: ~ 32% of contractors use the solution for recording purchases
• Concrete Direct: from order booking to delivery, facilitating real-time communication

SD 2030 Goals are our Core Priority

# - No rainwater harvesting (credit) till now in this year Data for the period H1 2021

Community Remains Top Priority

• 38,194 new beneficiaries added
• 9 watershed structures created
• 622 youth completed skilling courses
• 17 women self help group formed

• 7,532 children supported for education continuity during COVID-19
• 520 students attended online classes

Sustainable Livelihood Quality Education WASH (Water, Sanitation, Health & Hygiene) Malnutrition Mitigation

• 8,758 people provided drinking water facilities
• 1,085 people benefited through general and special health camps
• 399 persons with HIV, provided treatment at ART/STI

• 11,683 children below 5 years, benefited
• 293 Anganwadi centres (AWC) supported

Stepping Up Our Pandemic Response

Mask Distribution & Emergency Ration Kits Awareness Community health infrastructure support

• 1,57,393 masks produced and 1,43,497 distributed
• 3,860 distressed community members supported through dry and cooked food packets

• 11,907 people reached for tele-counselling (mental health awareness)
• 54,175 people made aware about COVID appropriate measures
• 1,64,731 people reached through disinfection drive

• 432 jumbo oxygen cylinder and 261 oxygen concentrators support to Government hospitals & COVID-care centers
• 6 dedicated COVID ambulance support
• 16 COVID-care centers supported with essential support items

Performance Review

Performance Highlights – Q2 2021 (Consolidated)

Strong performance delivery in a challenging quarter

Performance Highlights – H1 2021 (Consolidated)

Cost efficiencies under 'Parvat' driving margin expansion

Financial Results – Consolidated

Particulars	Quarter Ended June 2021			Half-Year Ended June 2021
(all amount in ₹ Crore)	Q2 2020	Q2 2021	Change (%)	H1 2020	H1 2021	Change (%)
Net Sales	2,520	3,810	51%	5,953	8,024	35%
EBITDA	525	869	65%	1,112	1,730	56%
EBITDA Margin (%)	20.8	22.8	2.0pp	18.7	21.6	2.9pp
Op. EBIT	363	723	99%	791	1,440	82%
Op. EBIT Margin (%)	14.4	19.0	4.6pp	13.3	17.9	4.6pp
Profit After Tax (PAT)	271	569	110%	594	1,132	91%
EPS (₹/share)	14.4	30.3	110%	31.6	60.3	91%

Income Statement – Cement Business

Particulars		Quarter Ended June 2021			Half-Year Ended June 2021
(Rs. / Ton)	Q2 2020	Q2 2021	Change per ton	H1 2020	H2 2021	Change per ton
Sales Revenue	5,050	5,153	103	4,777	5,005	228
Other Operating Income	164	106	-58	127	101	-26
Total Operating Income	5,214	5,259	45	4,904	5,107	202
Expenses
Cost of Materials Consumed	397	543	146	458	546	88
Power & Fuel Cost	932	1,183	251	1,019	1,085	66
Freight & Forwarding Cost	1,220	1,278	58	1,290	1,294	5
Employee Cost	326	274	-52	301	255	-47
Change In Inventory	257	-304	-560	-34	-183	-149
Other Expenses	636	753	117	705	728	23
Total Expenses	4,086	4,024	-62	3,968	3,982	15
EBITDA	1,128	1,235	107	937	1,124	188

Performance Analysis - Sales Volume

Strong growth despite 2nd wave of Covid

Cement Volume (Q2) (Million tonnes) Cement Volume (H1) (Million tonnes) 30.8% 43.7%

Performance Analysis – Net Selling Price

Improvement in realization driven by premium product and brand positioning

Performance Analysis – Cost of Materials Consumed

Impacted by reducing clinker factor and rising input costs, mitigated through project 'Parvat'

Performance Analysis – Power & Fuel Cost

Impact of higher fuel prices, various efficiency projects underway to drive cost down

Performance Analysis – Freight & Forwarding Cost

Projects like geo mix and network optimization underway to mitigate fuel cost headwinds

Performance Analysis – Employee Cost

Better absorption driven by higher volumes

Performance Analysis – Other Expenses

Increase driven by higher cost of maintenance in plants

Registered Office

Cement House, 121, Maharshi Karve Road, Mumbai – 400 020

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