ADITYA BIRLA GROUP

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Overview: Aditya Birla Group Amongst fastest growing business houses in India A successful corporate with enviable track record, both in India and overseas It operates in 33 countries with more than 133,000 employees worldwide A caring corporate citizen with benchmarked governance practices Aggregate revenues of US$ 35 billion Group flagships enjoy leadership in key businesses

GrasimUltraTech

Cement and Viscose Staple FibreCement

HindalcoIndian Rayon Indo Gulf Idea

MetalsApparels, Insurance, IT, Carbon Black Fertilizers Telecom

Overview: Aditya Birla Group

ABG: Global Standings UltraTech: largest producer of cement, and with the takeover of the UAEbased Star Cement, the group now ranks 8th amongst global companies in the cement sector.

Hindalco is the largest aluminum producer in India and among the top 10in the world.

Grasim along with the overseas entities are the largest producers in theworld in viscose fibre category.

The No.1 producer of carbon black in the world with the acquisition ofColumbian Chemicals Company

Fourth-largest producer of insulators in the world

Fifth-largest producer of acrylic fibre in the world Among the best energy efficient fertiliser plants

ABG: Global Presence Group plans investments of $17bn across its 33 companies Aimed at doubling the groups revenues to $65bn by 2015 Only 40 per cent of its total income comes from India

ABG: Building Scale Pursuing growth through both organic and inorganic means 11 acquisitions made in the last 15 years Acquisition of ETA Star has helped ABG to enter into Gulf, Bangladesh andPakistan. Acquisition of Columbian Chemicals will see carbon black scale up and provide an entry into key global markets Acquired manufacturing plants in Canada, China and Indonesia Palm plantations in Laos Mines in Australia Set up new plants in Egypt, Thailand and China.

Presence in various countries such as Thailand, Indonesia, Malaysia,Philippines, Egypt, Canada, China and AustraliaFUTURE PLANS The group has plans to re-enter the power business. Intention to enter in banking

Strategic Growth Framework

ABG Companies Strategic Investments Acquisition of Novelis to get access to stable markets make steady cash flows leverage on better technology

Invested in bankrupt copper mines in Australia to balance out high-margin and volatile businesses like copper mines and bauxite operations low-margin and stable businesses such as downstream copper and downstream aluminum.

Acquisition of the Atlanta-based Columbian Chemicals Company Catapulted the Aditya Birla Group to the world's No. 1 carbon black producer Economies of scale

Mode of InternationalizationCompany Domsj Fabriker Columbian Chemicals Star Cement Company Novelis Inc Mode Year Value Country Business Pulp & Fibre business Carbon Black Cement Business Aluminium and Copper Pulp & Fibre business BPO Carbon Black Acquisition 2011 Acquisition 2011 $340 million Sweden $875 million US Dubai Global

Acquisition 2010 $ 340 Million Acquisition 2007 $ 6 billion

St Anne Nackawic Pulp Mill Acquisition 2005 $ 100 Million Canada Minacs Worldwide Inc Liaoning Birla Carbon Ltd Acquisition 2006 $125 million Canada JV 2003 China

In a Nutshell: Aditya Birla Group global expansion has been driven by Acquisitions Of the past 7 International Deals between 2001-2011, 6 (out of 7) have been Acquisitions Biggest deal: Novelis Inc (2007); Acquired for US $6 Billion

BenefitsIncreased Market Size Return on investment Economies of Scale Huge opportunity for organic growth when the domestic market is saturated

Large investment projects may require global markets to justify the investment Leverage on policies related to taxes, patent protection etc

Economies of scale in manufacturing, marketing, R&D and Distribution Higher per unit profit

Location Advantages

Access to raw materials, transportation, lower cost labor, key customers

Country AnalysisPolitical Analysis Economic Analysis

Taxation Policy Privatization International traderegulations Government stability International stability

Interest rates Economic growth Inflation Exchange rates

Legal Analysis

Employment laws Consumer laws Competition laws Health and safety legislationShibu lijack

Country AnalysisRole of government Facilitating growth sectorwise Easing regulations for international expansion Providing environment for collaborative growth

Regulatory framework Moderate regulations:Sector wise regulations Facilitates growth as the nation is slated for growth in the future

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References http://businesstoday.intoday.in/story/the-kumar-mangalam-birla-corebusiness-team/1/18950.html http://www.adityabirla.com/media/press_reports/20071103_brand_icon.htm http://www.adityabirla.com/media/press_reports/global_play.html http://articles.timesofindia.indiatimes.com/2011-06-22/indiabusiness/29689373_1_aditya-birla-group-carbon-black-producercolumbian-chemicals

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