Salzer Electronics Ltd. — Capital/Financing Update 2019

Sep 30, 2019

Media Release

CRISIL reaffirms both Long term and Short-term Borrowing Ratings

Long Term Borrowing Reaffirmed at 'CRISIL A/Stable'

Short Term Borrowing Rating reaffirmed at 'CRISIL A1'

Resulting in betterterms for borrowings

Coimbatore, 30'" September 2019: Salzer Electronics Limited 155E: 517059, NSE: SALZERELECI, among leading players offering total and customised electrical solutions, is happy to announce that the Company's credit rating has been reaffirmed by CRISIL

The credit mlings on the Bank facilities of the Company haye been reaffirmed by the Rating Agency CRISIL at 'CRISIL A/Stahle' for long term borrowing and 'CRISIL A1' for short term borrowings. The mlings continue to reflect ^a leading market position in the domestic rotary switches market and an adequate financial risk profile. These strengths are partially offset by working mpilalsinlensive operations and exposure to intense competition in the electntal cables industry.

Key drivers for Ratings Reaffirmation by CRISIL'

• . Leading market pos in the domestic rotary switches market healthy reyenue growth oyer medium term, supported by market leadership in camropemled rotary switches segment; launch of higher margin products in wires and cables business, and new products such as threesphase drvrtvpe airscooled transformers and motor controls
• . Marketing tie-up , oyer 25 years of strong relationship with Larsen & Touhm Ltd (L&T; 'CRISIL AAA/FAAA/Stahle/CRISIL A1+') for distribution of products across segments
• . Sustained focus on research and development (Ran) Continuing focus on R&D and technology tierup with global majors will help maintain ledwnologv oompetitiyeness
• . Adequate financial risk profile: Healthy financial risk profile, marked by ^a comfortable networth of Rs 284 crore and gearing of0.52 time as on March 31, 2019. followed by Debt protection metrics expected to improye oyer the medium term, with net ash aocrual to total debt and interest coyerage mlios estimated to improye to 40°a and 5.74 times, respectiyely, by fistal 2021

Management Comment:

Commenting on the results, Mr. R. Doraiswamy, Joint Managing Director, Salzer Electronics Ltd said:

"I am happy to share that our financial and business performance for the full year ended FY19 and Q1 FY20 has been the key for our reaffirmation in CRISIL ratings. We have demonstrated good growth in our industrial switchgear and wires & cables segment. This long term & shortterm rating indicates Company's comfortable risk profile and are in line with our strategy of profitable growth and improvement in quality of our financial parameters through better operational performance.

These reaffirmed ratings will help all stakeholders especially financial institutions to appreciate the improved credit quality of the Company. In turn, the Company, going forward, will be able to access debt and capital at more efficient terms for its arowth initiatives."

About Salzer Electronics

• Salzer is a Leading player offering Total and Customized Electrical Solutions in Switchgears, $\blacksquare$ Wires & Cables and Energy Management business. It is the largest manufacturer of CAM Operated Rotary switches & Wire Ducts in India. The Company caters to a wide range of products with four in-house manufacturing facilities, located in Coimbatore
• The Company has a wide distribution network locally and globally, exporting to many countries. In India, Salzer markets its products through its own distributors and more than 350 local distributors of L&T. The Company has a strong R&D team that focuses on developing and commercializing the technologies of the products, and as a result, can offer total customized electrical solutions to its customers.

For further information, please contact:

Mr. Baskarasubramaniam	Ms. Savli Mangle / Mr. Smit Shah
Salzer Electronics Ltd.	Bridge Investor Relations Pvt. Ltd.
	Email: baskarasubramanian@salzergroup.com Email: savli@bridge-ir.com / smit@bridge-ir.com
www.salzergroup.net	www.bridge-ir.com

Caution Concerning Forward- Looking Statements:

This document includes certain forward-looking statements. These statements are based on management's current expectations or beliefs and are subject to uncertainty and changes in circumstances. Actual results may vary materially from those expressed or implied by the statements herein due to changes in economic, business, competitive, technological and/or regulatory factors. The Company is under no obligation to, and expressly disclaims any such obligation to, update or alter its forward-looking statements, whether as a result of new information, future events, or otherwise.