Aro Granite Industries Ltd. — Investor Presentation 2021

Jun 29, 2021

Aro granite industries ltd.

Regd. Office : 1001, 10th Floor, DLF Tower A, Jasola, New Delhi - 110 025. Phone : 91-11- 4 l 686 l 69, Fax : 9 l -l l-2694 l 984, E-mail : arodelhi@arotile.com

June 29, 2021

Bombay Stock Exchange Limited Department of Corporate Services Floor 25, P.J. Towers Dalal Street Mumbai 400001 (SCRIP CODE: 513729)

National Stock Exchange of India Limited Listing Department 5th Floor, Exchange Plaza Sandra (E) Mumbai 400051 (SCRIP CODE: AROGRANITE/EQ)

Sub.: Investor Presentation of the Company

Dear Sir,

Please find enclosed herewith a copy of Investor Presentation of the Company for your information and record please.

Thanking You

Yours faithfully For Aro granite industries ltd.

Comp}!�

Encl.: a/a

CORP. OFF. & WORKS

KONERIPALLI VILLAGE, SHOOLAGIRI (VIAi, HOSUR TALUK - 635 I I 7, KRISHNAGIRI DIST. TAMIL NADU, INDIA. TEL: 91 - 4344 - 252100 FAX: 91 - 4344 - 252217 E-mail: aro@arotile.com Web: www.arotile.com CIN : L74899DLI 988PLC03 I 5 IO

Investor Update – For the Quarter Ending 31st March 2021 June 2021

Disclaimer

Certain statements in this communication may be considered as 'forward looking statements' within the meaning of applicable law and regulations. These forward-looking statements involves a number of risks, uncertainties and other factors that could cause actual results to differ materially from those suggested by the forward looking statements, important development that could affect the company's operations include changes in the industry structure, significant changes in politics and economic environment in India and overseas, tax laws, import duties, litigation and labour relations.

Aro granite industries limited does not undertake to revise any forward-looking statement that may be made from time to time by or on behalf of the company.

Aro granite industries limited will not be in any way responsible for any action taken based on such statement and undertakes no obligation to publicly update these forward looking statement to reflect subsequent event or circumstances.

Company Snapshot

Indian Granite Industry

China is largest market for Indian raw granite block, 30.32 % of the total granite were exported to China

Large players finished products are

Statewise Granite Reserves

Source – Indian Mineral Yearbook 2019

Hosur Infrastructure

Slab Plant		Tile Plant
Jumbomatic Gang saws	12
72 Wire Multi Wire Saw	1
20 Head Polishing Line	31
12 head Grinding line
Flaming machine	1
Epoxy lines	3

53 Blade cutting Centre4Topping Centre1Calibration Line1Epoxy line1
20 Head Polishing line1
Cross cutting machine4
Cleft/Split Machine1

Cut to Size		Quartz – 180,000 m2/year
CNC Machine	2	Automatic Molding line	1
Edge Polishing	1	Calibration line	2

HOSUR – Gangsaws & Multi Wire Cutter

• 12 x Super Jumbo Gangsaws (4.5m)
• Suited for Cutting Most Granites

• 1 x Multi Wire (72 Wire)
• Suited for Fragile Granites, Quartizites, and Special Colours

HOSUR – Tiles

• 4 nos. Multi Blade Block Cutting Centers
• Calibrated and Chemfered tiles
• Over 25 years of experience in tile

In 10mm, 13mm, 15mm,20mm and 30mm	In 13mm, 15mm and20mm	Special Sizes
305 x 305 mm		400 x 800 mm
305 x 610 mm	600 x 600 mm	600 x 900 mm
400 x 400 mm	610 x 610 mm	600 x 1200 mm
400 x 600 mm		300 x 900 mm
457 x 457 mm

HOSUR – Quartz

HOSUR -Warehouse / Showroom

120,000 Square Feet of Display Space

Jaipur Plant

• We exported our first container (August 1, 2019) from Jaipur about 10 months after we started the construction of the SEZ Unit
• Installed capacity of plant is 1,50,000 sq. mtr per annum

Slab Plant
72 Wire Multi Wire Saw	1
20 Head Polishing Line	1
12 head Grinding line	1
Epoxy lines	2
CNC Machine	1

Financial Performance (Quarterly)

Particulars In Rs. Cr	Q3 FY20	Q4 FY20	Q1 FY21	Q2 FY21	Q3 FY21	Q4 FY21
Sales	42.53	43.60	28.31	46.74	48.30	56.02
Operating Exp	38.63	40.16	23.92	39.97	43.92	47.77
EBITDA	4.46	4.44	4.52	6.90	4.51	8.49
PAT	0.66	0.47	0.34	1.89	1.05	2.77
EBITDA Margins (in %)	10.48%	10.18%	15.96%	14.77%	9.35%	15.16%
Net Profit/Loss Margins (in %)	1.55%	1.07%	1.20%	4.04%	2.17%	4.95%

Financial Overview (Quarterly)

Profit After Tax Figures in INR Cr. Debt to Equity Ratio

Financial Overview (Quarterly)

Segment Sales - Slabs Figures in INR Cr.

Financial Highlights (Quarterly)

• Sales Increased by 28.49% From 43.60 Cr in Q4 FY2019-20 to 56.02 Cr in Q4 FY2020-21
• EBITDA Increased By 90.95% From 4.45 Cr in Q4 FY2019-20 to 8.49 Cr in Q4 FY2020-21
• PAT Increased By 496.11% From 0.47 Cr in Q4 FY2019-20 to 2.77 Cr in Q4 FY2020-21
• EBITDA Margins Increased From 10.20% in Q4 FY2019-20 to 15.16% in Q4 FY2020-21

Operational Highlights (Quarterly)

• Due to Covid-19 induced lockdown our sales were impacted in H1FY2021 but our sales have picked up from Q3FY2021 and we performed better than last year
• On the Raw material front we faced challenges in our Hosur facility but now raw material procurement has reached pre-covid levels
• Our Jaipur plant is running successfully and contributed more than 18% of our total sales in FY2021
• Due to travel restrictions Veego (our machine supplier for quartz plant) helped us through CCTV and Video Conferencing support and we were able to commission the quartz plant with Commercial Production Starting in January 2021
• We did Rs 2.3 Cr of sales from our Quartz plant in Q4 2021
• The sales of Quartz has been slow initially as our clients cant travel to visit our plants. Whatever offtake that has happened, is largely based on trust our clients have on us even though it's a new product line

Country wise Exports FY2021

New Plant (Jaipur)

• Our initiative to start plant in Jaipur has been quite successful It accounted for 18% of our sales in FY2021
• Our sales from Jaipur plant has picked up from monthly sales of Rs. 2 Cr sales to more than Rs. 3 Cr monthly sales
• Our portfolio of colors and volume has increased significantly due to wide variety of colors and shades from north India which have high demand in many countries specially in North America
• We expect demand for these new colors from North India will increase from other countries also, we shall utilize fully capacity of plant in FY22
• Availability of raw granite blocks at stable prices has been a big advantage and has helped us maintain our market share in the export markets
• Our business from Rajasthan is growing and we have portfolio of 26 colors with 6-7 shades being core colors, we remain confident on the contribution from the plant

New Processing Facility (Quartz)

• Company has set up processing facility for Quartz in its existing plant in Hosur with capacity of 180,000 m2 per Annum in the first phase
• Our Quartz plant was expected to commission in January 2020 but was delayed due to Covid-19
• We have started production from the plant from January 2021 we are increasing our production slowly and generated revenue of Rs. 2.3 Cr in Q4FY2021
• We have successfully completed trial run in February 2021 and product was successfully accepted by our customers,
• Our fixed investment in Quartz plant is low, as we are using / sharing existing infrastructure of Hosur Unit with the quartz plant. We expect good ROIs from this plant in the years ahead

Outlook

• 1. FY2021 has been a challenging year for the company as we lost sales for 43 days due to lockdown. Overall we were able to salvage the situation in the 2nd Half and closed the year on a satisfactory note.
• 1. In May 2021 the Second Wave of Covid-19 hit the country and that also caused state specific lockdowns across India. Since then the situation has improved as our plants are fully operational and raw material availability is also improving
• 1. Granite industry has made representation to the new government for re-opening of granite quarries, we expect positive policy changes will increase the availability of raw material
• 1. Our Jaipur plant has been successful and has started to contribute significantly to sales and profits of the company. We are optimistic our returns on this investment will be quite good
• 1. We have started sales from Quartz plant and due to its high demand across the world we expect our Quartz segment will contribute to our growth in coming years
• 1. The GST refund mechanism has smoothened out and that has improved our working capital requirement

For any further information, please contact

Sabyasachi Panigrahi Aro granite industries ltd. sabyasachi@arotile.com +91 11 41686169

Gaurav Sud Kanav Capital Advisors Pvt. Ltd. gaurav@kanavcapital.com +91 98101 22432

Registered Office: #1001, I0th Floor, DLF Tower A, Jasola , New Delhi - 110 025. (INDIA) Corporate Office & Works: Koneripalli Village, Shoolagiri (Via), Hosur ( TK) - 635 117, Tamilnadu, INDIA.

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The Aro granite industries limited's Logo is the trademark of Aro granite industries limited. In addition to company data, data from market research agencies, stock exchanges and industry publications has been used for this presentation. This material was used during an oral presentation; it is not a complete record of the discussion. This work may not be used, sold transferred, adapted, abridged, copied or reproduced in whole or in part in manner or form or in any media without the prior written consent. All product names and logos mentioned herein are the trademarks or registered trademarks of their respective owners.