MAHINDRA CIE AUTOMOTIVE

Industrial Group specialized in Managing High Value Added Processes

June 20131

Table of Contents

1 2 3 4

Introduction to the Mahindra CIE Alliance Rationale for the Alliance Introduction to CIE Automotive & Systech Key Transaction Steps

Industrial Group specialized in Managing High Value Added Processes

CIE Automotive + Mahindra Global Alliance Overview

CIE Automotive, Spain and Mahindra & Mahindra (M&M), India enter into a global Alliance in the automotive component business

Cross investment by both groups

CIE Automotive, through Autometal, to invest in automotive component businesses of M&Ms Systech Sector (Mahindra Systech) M&M to invest in est in CIE Automotive A tomoti e (Spain)

Merge of all automotive component companies of Mahindra Systech and CIE European Forging companies into an India-listed automotive supplier creating Mahindra CIE Automotive that consists of
Mahindra Systechs y automotive components p business ( (FY13 Sales EUR 575 Mn) ) with operations in India and Europe CIEs European Forgings business (CY12 Sales EUR 150 Mn) with operations in Spain p and Lithuania
*CY2012: Jan 2012-Dec 2012 / FY2013: April 2012-March 2013
Industrial Group specialized in Managing High Value Added Processes

CIE Automotive + Mahindra Global Alliance

Schematic Representation

M&M

CIE Automotive

Mahindra Systech
Forging*

Autometal
Brazil
Forgings, Machining Castings, Stampings, Plastics, Painting

Forgings

Composites

Gears

Machining Stampings

Castings

Stampings

Aluminum Plastic

Mexico

Aluminum, Forgings, Machining, Stampings, Plastics, Painting

Mahindra CIE Automotive Limited

Bio Fuels
* CIE Forgings plants in Spain & Lithuania
Note: Mahindra Systech is not a legal entity All companies, listed or unlisted, will be merged into Mahindra Forgings Ltd. to be renamed as Mahindra CIE Automotive Ltd

USA

Plastics

Inf. & Comm Tech.

China

Forgings

Indicates transaction Indicates merger Listed company

4

Industrial Group specialized in Managing High Value Added Processes

Table of Contents

1 2 3 4

Introduction to the Mahindra CIE Alliance Rationale for the Alliance Introduction to CIE Automotive & Systech Key Transaction Steps

Industrial Group specialized in Managing High Value Added Processes

Industry structure
As industry consolidates via acquisitions/partnerships, global presence is key
30,000

Number of Autom motive OE EMs1

60

Nu umber of f supplie ers

20,000 40

20

10,000

1950

1955

1960

1965

1970

1975

1980

1985

1990

1995

2000 2

2005 2

2010 2

2015 2

Source: Boston Consulting Group, E&Y

Supplier consolidation is faster than OEM consolidation Global presence (emerging + developed world) becoming key for suppliers

2020 2

Industrial Group specialized in Managing High Value Added Processes

Strategic positioning in high growth markets

Annual Vehicle production: Period 2012 2017 Europa
22 19 4,0 60 6,0 3,2 2,9 3,7 2,1 80

(Mn units.)

Mexico

Brazil

India

Russia

World

4,3

2,4

98

2012

2017E

2012

2017E

2012

2017E

2012

2017E

2012

2017E

2012

2017E

In 2013 year is expected a weaker market with medium term recovery recovery.

Growth in 2013E by 4%. Softer Medium term recovery

2013E Growth by 4%. Growing future prospects continue

2013E Growth by 9%. Growing future prospects continue

2013E Growth by 9%. Growth continue year by year

2013E Growth by 2%. Growth continue year by year

Source : Vehicle Production, CSM March 2013 Growth % : CAGR (Compound Annual Growth Rate)

CIE Automotive bet is to increase its p presence in Mexico and settle in India
Industrial Group specialized in Managing High Value Added Processes

Why India?

In Asia we are committed to INDIA

Significant growth in the coming years. Great country, country very competitive costs for domestic market and export. W ld leader l d in i Heavy H V hi l i d t World Vehicle industry.

The world leader in forging. forging A country with great opportunity to lead the growth in the i (I d i Th il d etc.). t ) region (Indonesia, Thailand,
Industrial Group specialized in Managing High Value Added Processes

Transaction impact
CIE Automotive Mahindra Systech Forgings, Castings, Forgings Castings Composites Composites, Stamping, Gears

Segments OEM Customers Markets Market Position Size (EUR Mn)

Forgings, Stampings, Castings, Machining, Plastics, Paintings, Aluminum

Nafta, , Mercosur, , Europe, p , China Russia, Morocco Amongst top European, Brazilian and Nafta auto component groups

India and Europe p

Leader in India crankshafts ( (Car+UV) ) Leader in Heavy Vehicle Forgings (Europe) Amongst top 7 Indian auto comp groups

1 647 (CY2012*) 1.647

575 (FY2013*)

*CY2012: Jan 2012-Dec 2012 / FY2013: April 2012-March 2013

A Amongst t top t auto t components t groups globally l b ll

Industrial Group specialized in Managing High Value Added Processes

Complementary product market presence

Process St Stampings i Forgings(1) Gears/ Machining (2) Plastics Aluminum Castings P i ti Painting Roof Sys. Composites Magnets

EU

NAFTA

Brazil

Russia

India

China

( ) Forgings (1) g g in EU largely g y complementary p y CIE serves car markets while Systech y serves CV market (2)Gears/ Machining complementary Systech manufactures gears while CIE machines other components
Industrial Group specialized in Managing High Value Added Processes

CIE Presence

Systech Presence

10

New forging powerhouse under Autometal management

Forgings Europe Forgings Nafta Forgings China

Forgings India Forgings Brazil

Creation of a major forging group with global footprint

Industrial Group specialized in Managing High Value Added Processes

11

Diversifying into new high growth markets

Asia

Asia
America Europe

Europe

America

Sales 2012

Sales 2017

Consolidating a significant market share in the Asian market, g with the strategy gy of emerging g g markets growth g continuing

Industrial Group specialized in Managing High Value Added Processes

12

Diversification bringing less volatility to cash flows

Diversifying financial markets
Three different vehicles to invest in the Auto sector: CIE Automotive: Global market investment Autometal: Investment in emerging markets Mahindra CIE Automotive: Investment in Asia and Global Forgings Highest standards of corporate governance in each market

Equities

Banks and Debt Markets

Diversifying finance: raising where cash flows are generated Relationships with global and local banks in every region Global access to debt capital markets

Diversification and transparency of being listed companies i i improves credit dit quality lit
Industrial Group specialized in Managing High Value Added Processes

13

Alliance with a partner that has a perfect match

CIE Automotive & Mahindra groups have similar values & focus areas

Focus on financial returns Strong g organic g & inorganic g growth g Multi - technology Decentralized (local) decision process Independent business units JV / Acquisition Focus Globalization

14

Industrial Group specialized in Managing High Value Added Processes

The transaction in numbers

Integration of a Group of companies with a recurrent level (1) of:

Revenues: EUR 650 Mn EBITDA : EUR 66 Mn Net financial debt: EUR 170 Mn

The transaction is mainly cash neutral at CIE Automotive level:

Cash paid for equity acquisitions for Mahindra stake in Systech companies is

reinvested by Mahindra into CIE Automotive shares (13,5%) Only cash out comes from tender offers: aprox EUR 25 Mn (2)

CIE Automotive Group merges its European Forgings into Mahindra CIE p holds 51%~ 53% ( (2) ) and Mahindra 20% As a result CIE Automotive Group of Mahindra CIE

(1) Recurrent level figures: Proforma calculated at normal 2011 market levels in Europe and India (2) Depending on the tender offer acceptance

Industrial Group specialized in Managing High Value Added Processes

15

Thoughts on value creation

BENEFICIAL FOR ALL SHAREHOLDERS

CIE Automotive has proven financial performance over last 16 years with domain knowledge in automotive components business, in all different geographical areas. CIE Automotive, with successful track record of M&As, has also proved its integration capacity, improving margins of integrated companies and creating value for shareholders. Mahindra CIE operational performance expected to improve with synergy; particularly in Europe. Indian operations are on the cusp of upturn. Mahindra CIE will also have access to other geographic markets where CIE has presence. M&M continues to be a strategic investor in auto comp business with 20% stake in Mahindra CIE and 13.5% stake in Spain at parent level. Managements M t of f the th alliance lli will ill b be aligned li d operationally ti ll and d shareholders h h ld are aligned li d strategically. Together, the alliance becomes close to EUR 2,2 Bn and fulfills M&Ms & CIEs ambition to be a global player in this business.
Industrial Group specialized in Managing High Value Added Processes

16

Table of contents

1 2 3 4

Introduction to the Mahindra CIE Alliance Rationale for the Alliance Introduction to CIE Automotive & Systech Key Transaction Steps

Industrial Group specialized in Managing High Value Added Processes

17

Overview of CIE Automotive

Company Overview

Financial Summary

Listed in Spain with a significant subsidiary listed in Brazil Key business areas include forgings, machining stampings, machining, stampings casting, casting plastics, plastics Aluminum and painting. Locations - Europe, Brazil, Mexico, USA, , China, , Russia, , Morocco

EUR Mn Sales EBITDA EBITDA margin i PAT Net Debt

CY 10 1,591 193 12 1% 12.1% 41 507

CY 11 1,840 234 12 7% 12.7% 61 342

CY 12 1,647 224 13 6% 13.6% 61 394

*CY2012: Jan 2012-Dec 2012 / FY2013: April 2012-March 2013

Shareholding Pattern of CIE Automotive

T.S. 10,0% Freefloat 21,5% Institutions 18,5% Gestamp 25 9% 25,9%
Managemen tTeam/ FamilyOffice 24 4% 24,4%

Corporate Structure
Key businesses: Aluminum, Forgins, Castings, Stampings, M hi i Machining, Plastics. Non key businesses: Biofuels, Info & Comm Tech Sales: EUR 1,647 Mn EBITDA: EUR 224 Mn Market Cap: EUR 659 Mn

CIE (Spain)
75%

Autometal (Brazil)

Sales: Eur 641 Mn EBITDA: Eur 108 Mn Market Cap: Eur 978 Mn

Industrial Group specialized in Managing High Value Added Processes

18

Overview of Autometal

Company Overview

Financial Summary

Listed in Brazil Key business areas include forgings, machining, stampings, casting plastics casting, plastics, aluminum and painting Locations Brazil, Mexico, USA and China

EUR Mn Sales EBITDA EBITDA margin PAT Net Debt

CY 10 670 128 19.2% 58 96

CY 11 671 126 18.7% 79 111

CY 12 641 108 16.9% 63 36

*CY2012: Jan 2012-Dec 2012 / FY2013: April 2012-March 2013

Shareholding Pattern of Autometal

Corporate Structure
CIE (Spain)
75%

Autometal (Brazil)

Brazil Ops

Mexico Ops

USA Ops

China Ops

Industrial Group specialized in Managing High Value Added Processes

19

Overview of Systech auto components

Business Overview

Financial Summary

Largest part of Mahindra Systech Sector (~80%) FY13 Sales of ~INR 40,000 mn / Euro 580 mn 19 Manufacturing facilities in 4 countries 55% of revenues operations from European

INR mn FY11 FY12 FY13 13,364 18,231 18,413 Sales: India Sales: Europe 22,448 26,488 22,175 Euro mn Sales: India 191 260 263 321 378 317 Sales: Europe
*1 Euro = INR 70.0

*CY2012: Jan 2012-Dec 2012 / FY2013: April 2012-March 2013

Sales by Business
Others / 4% Forgings / 55% Stampings / 19%

Corporate Structure
Systech Sector

Auto Components C
Listed: Forgings Stampings (part of MUSCO) Composites Private: Hinoday (Castings + Magnets) Gears

St l Steel Eng. Services Aerospace

Not Part of Transaction

Gears / 13% Castings / 9%

Industrial Group specialized in Managing High Value Added Processes

20

CIE Automotive performance

Profitable growth history over 10 years; successful track record of 50 M&As
Sales Evolution (EUR Mn) EBITDA Evolution (EUR Mn)

RoCE(2) 15,5% in 2012

Auto EBITDA margin of 15,8% in 2012

(1) 2006 to 2011 data deducting turnover of diesel oil used for blending (2) ROCE calculated as EBIT divided by average employed capital (equity + net financial debt)

CIE Automotives growth and profitability trend keeps in double digit rates, h i having reached h d an optimal ti l activity ti it and d EBITDA l level l and d a record dN Net t Result in its history
Industrial Group specialized in Managing High Value Added Processes

21

CIE Automotive unique positioning

Tier 1.5 : Supply parts to OEMs and Tier 1 Business Characteristics

Strong Commercial Relationships Growth Fuelled by Alliances & Joint Ventures Emphasis on Corporate Culture of Productivity

Excellent relationship and penetration with all OEM and Tier 1 customers

Track record with over 50 new integrations in the last 10 year on a global scale

Lean and robust procedures with effective cost control

Product Portfolio

Products serving global platforms and local customer needs

Multi-technology Portfolio

R&D in multiple technologies as a differentiating factor offering broad growth potential

Overtime CIE has been able to achieve higher EBIT margins than the industry average
Industrial Group specialized in Managing High Value Added Processes

22

Table of contents

1 2 3 4

Introduction to the Mahindra CIE Alliance Rationale for the Alliance Introduction to CIE Automotive & Systech Key Transaction Steps

Industrial Group specialized in Managing High Value Added Processes

23

Transaction structure (STEP 1)

CIE Automotive, through Autometal, to purchase stake in MFL, MHIL, and MCL from M&M

CIE (S (Spain )

75%

M&M
Share Sh Purchase + Open Offer

Autometal (Brazil)
72%

Mahindra Forgings

Share Purchase + Open offer

PIA 2 (Spain)
28%
Share Purchase

Mahindra Composites

Mahindra Hinoday Industries

Asset Integration g

CIE Forgings

Industrial Group specialized in Managing High Value Added Processes

24

Transaction structure (STEP 2)

Mahindra CIE Automotive is created M&M
28% ~20% ~51%
PIA 2 (Spain)

13 5% 13.5%

CIE Automotive
~75% 72% %

Autometal
~[51]%

Mahindra CIE Automotive Limited* Mahindra Forgings (Europe)

Merger
Mahindra Gears International International.

MUSCO

Mahindra Composites

Mahindra Investments (India)

Mahindra Hinoday

PIA 3

Mahindra Gears & Transmission India Ltd. (India)

Metalcastello (Italy)

CIE Forgings F i

*Erstwhile Mahindra Forgings Limited

Industrial Group specialized in Managing High Value Added Processes

25

Swap ratios

Company Mahindra Hinoday M hi d C Mahindra Composites it Mahindra Gears Europe Mahindra Gears India MUSCO CIE Forgings
*Swap ratios are based to 1 share of Mahindra Forgings Limited

Swap Ratio 1.10 0 90 0.90 0.17 0.20 2.84 1.05

Industrial Group specialized in Managing High Value Added Processes

26

Estimated timeline for transaction and regulatory approvals

Event Transaction Signing Closure of Open Offer Receipt of High Court Approval Estimated Dates [June 15, 2013] [Oct, 2013] [April, 2014]

Regulatory approvals Competition Commission of India Bundeskartelamt, Germany (Anti-Trust Authority) SEBI Clearance Cl f for the h L Letter of f Off Offer (Open (O Offer) Off ) High Court and shareholders approval for the merger

Industrial Group specialized in Managing High Value Added Processes

27

Advisors

Legal Advisors

Manager of the tender offers

Independent valuers providing Swap Ratios for Merger

NM RAIJI

Independent valuers for the capital increase in CIE

Industrial Group specialized in Managing High Value Added Processes

28

Industrial Group specialized in Managing High Value Added Processes

29