20 August 2003

HG METAL MANUFACTURING LIMITED

PLANT TOUR

Moving Up the Value Chain Competitive Strengths Financial Highlights Growth Prospects and Future Plans Industry Comparison Comparison between HG Metal & AnnAik

PRESENTATION OUTLINEPRESENTATION OUTLINE

We Custom Manufacture to your Satisfaction

MOVING UP THE VALUE CHAIN

We Custom Manufacture to your Satisfaction

Mr Wee PiewChief Executive OfficerHG Metal Manufacturing Limited

Established partnership HGC - small retailer of steel products

1971

Became a stockist for steel products

1973

Acquired Almech

1984HG Metal incorporated

Expanded warehouse storage area

1988

1998Moved to current premise 30 Jalan Buroh

Acquired OMPCommenced steel product mfg New 3 storey factory plus w/house Acquired JHL

2000

GROWTH PATHGROWTH PATH

We Custom Manufacture to your Satisfaction

HG METAL

Jin Heng Li Hardware Sdn Bhd

(Malaysia)

Oriental Metals Pte Ltd

(S’pore)

59.2%100%

(Our Manufacturing Arm)

CURRENT GROUP STRUCTURECURRENT GROUP STRUCTURE

We Custom Manufacture to your Satisfaction

RetailerSmall Stockist Post-IPO

Enlarged Manufacturing Capabilities

THE STEEL VALUE CHAINTHE STEEL VALUE CHAIN

Major Stockist

Increased Profit Margin

Custom Manufacturer

We Custom Manufacture to your Satisfaction

Reinforcement Bars

Pipes

I Beams

Hollow Sections

Ship Plates

Angle Bars

TRADING TRADING Our Wide Range of Products

Flat Bars

We Custom Manufacture to your Satisfaction

Steel Plates

Hollow Channels

Pipes Mild Steel Lip Channels

H-Beams

A One-Stop Supermarket for Steel Products

TRADING TRADING

We Custom Manufacture to your Satisfaction

The Manufacturing Process

SlittingMachine

Forming Rolls

Slitting Slitted Steel Coils

Raw Materials – Mother Hot Rolled Coil

Final Manufactured Products

MANUFACTURING-Growth DriverMANUFACTURING-Growth Driver

Forming Line

Tailor According to Customers’ Specific RequirementCore Productsi) Mild Steel Lip Channels

(Local Market Size: Estimated S$ 10 million) ii)Flat Barsiii)Steel Pipes (Local Market Size: S$50million per year)

MANUFACTURING-Growth DriverMANUFACTURING-Growth Driver

We Custom Manufacture to your Satisfaction

Production Capacity

i) 600 MT/month for MSLC currently

ii) Can easily increase to 1000 MT/month

Diversified Industry ApplicationsEnd-users Ship Building / Ship Repair Industrial and Steel Fabrication Oil and Gas Construction (Building, etc) Engineering Major Infrastructure and more…

We are NOT dependent on any single industry!

APPLICATIONS OF STEELAPPLICATIONS OF STEEL

We Custom Manufacture to your Satisfaction

COMPETITIVE STRENGTHS

We Custom Manufacture to your Satisfaction

Custom Manufacturing Capability

First Mover Advantage - Stock availability

- Short delivery time Better Customer Fulfillment

- ability to manufacture according to clients’ strict requirements or commercially unavailable

(vs competitors- NO manufacturing facility ) One-stop service provider Enhanced Profit Margins

Dominant Market Share in Mild Steel Lip Channels

COMPETITIVE STRENGTHSCOMPETITIVE STRENGTHS

We Custom Manufacture to your Satisfaction

High Barriers to Entry

First mover competitive advantage Heavy initial investment Large working capital Established brand name and reputation Skilled management and staff – difficult to find Strong knowledge and understanding of the industry

It’s Not Easy to duplicate our Business Model nor acquire our Manufacturing Capabilities

COMPETITIVE STRENGTHSCOMPETITIVE STRENGTHS

We Custom Manufacture to your Satisfaction

COMPETITIVE STRENGTHSCOMPETITIVE STRENGTHS

Established Customer Base > 400 customers = Diversified customer base Solid and long working relationships

Reliable and Established Suppliers Long term relationships with established steel mills or

their representatives and/or agents Diversified supplier base = Best quality steel at the most competitive price

We are NOT reliant on any single supplier!

We are NOT dependent on any singlecustomer / industry!

We Custom Manufacture to your Satisfaction

Our Sales Network (Mainly South East Asia)

Our Suppliers

MyanmarMyanmar

Ukraine

Turkey

Russia

Sri LankaSri Lanka BruneiBrunei

IndonesiaIndonesia

ThailandThailand

MalaysiaMalaysia SingaporeSingapore

Other eastern European countries

We Custom Manufacture to your Satisfaction

COMPETITIVE STRENGTHSCOMPETITIVE STRENGTHS

COMPETITIVE STRENGTHSCOMPETITIVE STRENGTHS

Extensive Range of Steel ProductsWe carry > 2,000 different steel productsCustomised or commercially available products

All dimensions available

“You name it, we have it!”

We Custom Manufacture to your Satisfaction

Hands On & Passionate Mgmt Team Most of our executive directors have

> 20 years experience in the steel industry Supported by professional management team

Our Men of Steel

COMPETITIVE STRENGTHSCOMPETITIVE STRENGTHS

We Custom Manufacture to your Satisfaction

FINANCIAL HIGHLIGHTS

We Custom Manufacture to your Satisfaction

Group Turnover

For the financial year ended 31 October

S$ m

illio

ns

2001

77.277.2

74.4

2.8

2002

90.390.3

81.9

8.4

Trading and othersManufacturing

FINANCIAL HIGHLIGHTSFINANCIAL HIGHLIGHTS

We Custom Manufacture to your Satisfaction

1H2003

40.2

2001

82.482.4

75.3

7.1

5.445.645.6

For the financial year ended 31 October

S$ m

illio

ns

2001

2.62.6

2.6

2002

3.73.7

2.1

1.6

Trading and othersManufacturing

FINANCIAL HIGHLIGHTSFINANCIAL HIGHLIGHTS

We Custom Manufacture to your Satisfaction

1H2003

1.1

2001

3.13.1

2.4

0.7

0.81.91.9

Profit Before Taxation

For the financial year ended 31 October 2001 2002

perc

ent

PBT Margin: Manufacturing vs Trading

4.1

19

2.6

TradingManufacturingOverall

FINANCIAL HIGHLIGHTSFINANCIAL HIGHLIGHTS

We Custom Manufacture to your Satisfaction

3.72.4

9.5

Shipping5.0%

Construction4.6%

Engineering10.4%

Stockist and retailers80.0%

Who We Sell To

FINANCIAL HIGHLIGHTSFINANCIAL HIGHLIGHTS

We Custom Manufacture to your Satisfaction

Update??

Others5.3% Indonesia

22.9%

Malaysia28.0%

Singapore43.9%

Breakdown by Geographical Region

Other countries include Thailand, Brunei, Myanmar, Sri Lanka and South Korea

FINANCIAL HIGHLIGHTSFINANCIAL HIGHLIGHTS

We Custom Manufacture to your Satisfaction

Update??

GROWTH PROSPECTSand FUTURE PLANS

We Custom Manufacture to your Satisfaction

100

300200

400

500

600

700

800

1994 1995 1996 1997 1998 1999 2000 2001(F) 2002(F)

World

Asia

Mill

ion

met

ric to

ns

Source: International Iron and Steel Institute, Oct 2001

Steel Consumption

GROWTH PROSPECTS GROWTH PROSPECTS

We Custom Manufacture to your Satisfaction

Steel Product Manufacturing Business Expand manufacturing product range to

include steel pipes Current demand for steel pipes approx. 5 times

more than mild steel lip channels Higher margins derived from manufacturing

Versatile manufacturing capability

GROWTH PROSPECTS - MFGGROWTH PROSPECTS - MFG

We Custom Manufacture to your Satisfaction

Enhancement of our Return on Invested Capital (“ROIC”)

Expected increase in utilisation rate will reduce our production cost and enhance our ROIC

New Steel pipes(rectangular, round, etc) Current

MSLC, flat bars

GROWTH PROSPECTS - MFGGROWTH PROSPECTS - MFG

We Custom Manufacture to your Satisfaction

Expand Manufacturing OperationBroaden Product Mix Steel pipes (round and rectangular pipes) Enlarge market share in steel pipes (Estimated 35% of market share) Fully operational in 2003

Material impact in FY04

FUTURE PLANS - MFGFUTURE PLANS - MFG

Broaden Product MarketLeverage on established trading network in

region to distribute manufactured steel products

We Custom Manufacture to your Satisfaction

INDUSTRY COMPARISONINDUSTRY COMPARISON

 * source: Business Times 15 August 2003

We Custom Manufacture to your Satisfaction

Company Revenue (S$’000)

Net Earnings (S$’000)

Market Cap*

(S$’ million)

PE Ratio*

HG Metal 90,291 2,792 22.2 6x

Lee Metal 119,950 2,072 39.6 19.6x

Nam Lee Metal

48,876 1,406 80.2 26.5x

Hup Seng Huat

48,826 1,910 51.1 26.6x

Average -- -- -- 19.7x

 Results are extracted from Company Annual Reports

 * source: AnnAik Prospectus on Opera, MAS

We Custom Manufacture to your Satisfaction

Company HG METAL1H2003 Results

ANNAIK* FY2002 Results

Revenue (S$’000) 45,615 26,843

PBT (S$’000) 1,928 2,836

Net Earnings (S$’000) 1,314 2,018

Business Manufacture customized steel products like flat steel bars, mild lip channels and steel pipes. Distribution business in steel products.

Manufacture stainless steel flanges and distribute stainless steel products, which are used mainly in piping systems. Distribution business in stainless steel products.

NTA 25.55 cents 12.21 cents

HG METAL Vs ANN AIKHG METAL Vs ANN AIK

HG METAL MFG LIMITEDHG METAL MFG LIMITEDMoving up the Steel Value Chain… Manufacturing towards Customer Satisfaction and Higher Profits

We Custom Manufacture to your Satisfaction