Subir Pal, October 17th 2013, Nashik

ABB India, Analyst meet 2013

Market outlook

© ABB Group
October 18, 2013 | Slide 1
Analyst Presentation - ABB India Ltd
Nashik, Maharasthra
Safe-harbor statement

This presentation includes forward-looking information and statements including statements

concerning the outlook for our businesses. These statements are based on current
expectations, estimates and projections about the factors that may affect our future
performance, including global economic conditions, and the economic conditions of the
regions and industries that are major markets for ABB Ltd. These expectations, estimates
and projections are generally identifiable by statements containing words such as “expects,”
“believes,” “estimates,” “targets,” “plans,” “outlook” or similar expressions.

There are numerous risks and uncertainties, many of which are beyond our control, that
could cause our actual results to differ materially from the forward-looking information and
statements made in this presentation and which could affect our ability to achieve any or all
of our stated targets. The important factors that could cause such differences include,
among others:
 business risks associated with the with the volatile global economic
environment and political conditions
 costs associated with compliance activities
 raw materials availability and prices
 market acceptance of new products and services
 changes in governmental regulations and currency exchange rates and
 such other factors as may be discussed from time to time in ABB Ltd’s
filings with the U.S. Securities and Exchange Commission, including its
Annual Reports on Form 20-F.
Although ABB Ltd believes that its expectations reflected in any such forward-looking
statement are based upon reasonable assumptions, it can give no assurance that those
expectations will be achieved.

© ABB Group
October 18, 2013 | Slide 2
Analyst Presentation - ABB India Ltd
Nashik, Maharasthra
India
Long term growth drivers

$750bn of planned infrastructure 40% of India’s population will live in

cities by 2030
investments from 2012 to17

$1.8tr was the nominal GDP of India in

2012

80GW planned capacity addition in

power generation by 2017
64% of population in working age
group by 2021

42% Indian population above middle 1.5mn engineering & science

income levels by 2025
graduates are added annually to talent base

© ABB Group
October 18, 2013 | Slide 3
Analyst Presentation - ABB India Ltd
Nashik, Maharasthra Source: Planning Commission, United Nation – HDI 2011, Harvard: report: Population dynamics in India, OECD report – The emerging middle
class in developing countries , NASSCOM- Knowledge Base, World Bank Data
 Economic Outlook
Policy support required…impact of elections unknown
Real GDP Growth (%) IIP YoY change (%)
8.4%
9.7%
9.3%
7.9% 8.1%
7.2% 7.4%
3.4%
6.5% 2.4% 2.8%
6.0% 2.0% 1.9%
5.5%
5.0% 0.6% 0.6%
4.6% -0.1%
-0.7% -0.8%-0.5%
3.7% -1.6%-1.8%

Max Min Avg

June'13
Aug'12

Aug'13
Sept'12

Jan'13

May'13
Jul'12

Oct'12

Apr'13
Mar'13
Feb'13
Nov'12

Dec'12

July'13
2005-09 2009-12 2013-14E 2015-20F

40 CAD widens to 4.9% of GDP Fiscal Deficit swells

6.7 74.6%
30 31 4.05
5.4
4.9 As % of
Budget Estimate
20 3.9 3.6 21
20 65.7%
18
16
10
3.4

0
June'12 Sep'12 Dec'12 Mar'13 Jun'13
Apr-Aug 2012 Apr-aug 2013
© ABB Group
October 18, 2013 | Slide 4 CAD (BUSD) % of GDP Fisical Deficit (Lakh crores)
Analyst Presentation - ABB India Ltd
Nashik, Maharasthra
Source: BCG, GoI, Global Insight
Project data
New projects still at a dismal state
Value of projects (Crores)
743,720
688,761
600,438 574,667

444,907 466,735
398,192
356,824 357,754
314,966
277,588
208,103
165,574 147,650 119,540
112,636
108,877 51,006 69,665 119,618 148,550
38,807 28,674 30,358 50,458 50,945 158,091 95,170
Q2 2010 Q3 2010 Q4 2010 Q1 2011 Q2 2011 Q3 2011 Q4 2011 Q1 2012 Q2 2012 Q3 2012 Q4 2012 Q1 2013 Q2 2013 Q3 2013*
New Projects Announced Stalled Projects

Number of projects
1,351

1,064 1,111
1,036
902 882 850 829
663

371 342
301 300 237
134 171 154 134
60 93 130 74 105 109
83 106 107 85
Q2 2010 Q3 2010 Q4 2010 Q1 2011 Q2 2011 Q3 2011 Q4 2011 Q1 2012 Q2 2012 Q3 2012 Q4 2012 Q1 2013 Q2 2013 Q3 2013

New Projects Announced Stalled Projects

© ABB Group
October 18, 2013 | Slide 5
Analyst Presentation - ABB India Ltd
Nashik, Maharasthra Note: Q3 2013=Till Sept 24, 2013 Data
Source: Centre for Monitoring of Indian Economy (CMIE)
Growth areas
Balancing traditional market slowdown Potential Market –
Next 5 Yrs
Tier 2 metro & DFCs
~20,000 Cr
Urbanization Buildings

Data centers

HVDC

Grid reliability & interconnection SVC & WAMS ~ 23,000 Cr

Distribution Franchises

PF regulations

Perform, Achieve, Trade

Energy Efficiency
~ 6000 Cr
Process Optimizations

Power Factor corrections

Renewable Energy Grid connected solar

~ 18000 Cr
Wind

© ABB Group
October 18, 2013 | Slide 6
Analyst Presentation - ABB India Ltd
Nashik, Maharasthra
Accelerating growth in services & exports
Service business to overall Service Portfolio
• Spares and Consumables
18%

12%
• Maintenance & Repairs
10%
• Engineering & Consulting
• Extension, Upgrades, Retrofit
• End-of life services
2010
2012
2015 • Training

Exports continue to grow Our Export offerings

In Crores
1500 • HV Breakers, MV Switchgear,
Transformers, Substations, MCBs, LV
900 Systems, Plant automation
500

Geographies
• Europe, Americas, South Asia, Middle
2010
2012 East & Africa
2015
© ABB Group
October 18, 2013 | Slide 7
Analyst Presentation - ABB India Ltd
Nashik, Maharasthra
ABB India Limited – Export Portfolio

Power
Products –
High B
Voltage

Circuit Breakers Instrument Transformers Disconnectors Capacitors

Power
Products –
Medium
Voltage

11kV/33kV Indoor S.gear / Unigear Panels SF6 Circuit Breaker Indoor / Outdoor Ring Main Units

Power
Products –
Transformers

131 MVA – Energy Ventures, 25 MVA – EEPCO 570 MVA Generator Trafo for
Malyasia Ethiopio Bangladesh thru ABB Singapore

© ABB Group
October 18, 2013 | Slide 8
Analyst Presentation - ABB India Ltd
Nashik, Maharasthra
ABB India Limited – Export Portfolio

Process Power
Automation Systems

Seamless Tube Mill in Saudi Arabia Substation project in Sri Lanka

Low
Voltage
Products

Contactors MCB s Switch Fuse Switches OS MNS

200A to 800A Switchboards

© ABB Group
October 18, 2013 | Slide 9
Analyst Presentation - ABB India Ltd
Nashik, Maharasthra
Key Sectors
2014 Outlook
Segment investment Segment investment
Customer growth/outlook Customer growth/outlook
Segment Segment
2013 2014 2013 2014

Power
Steel
Generation

Cement Power T&D

Renewable-
Oil & Gas Solar

Renewable-
Mining Wind

Paper Railways

© ABB Group
October 18, 2013 | Slide 10
Analyst Presentation - ABB India Ltd
Nashik, Maharasthra
 October 17th 2013, Tajinder Vohra

Operations & supply chain

© ABB Group
October 18, 2013 | Slide 11
Analyst Presentation - ABB India Ltd
Nashik, Maharasthra
Creating Competitive Operations
Scope and Scale
Material Costs Improvement Resources and teams in Place

• Negotiations, Localization
Material Costs
• Redesign, Indigenization
• Project Execution
• Global Contracts • Supply Chain and Operation
Excellence team at India level –
400+ people
• 18+ In country for country
Indigenization projects underway
Operating Costs/Other Cost Improvement
• 300+ Operational Excellence
Operating
projects underway
Expenses
• Footprint Rationalization
• Country level Technology
• Manufacturing productivity Organization
(personnel,
other operating • Quality improvement
costs)
• Factory Upgrades

© ABB Group
October 18, 2013 | Slide 12
Analyst Presentation - ABB India Ltd
Nashik, Maharasthra
What are Supply Chain opportunities in India
A supply side perspective
Addressable Spend

Centrally • Over 50 % of external

managed
Indirect spend covered by top 10
Unique categories
spend
• Leveraging global
ABB Grp.
contracts across Steel,
Imports Castings, Transportation
etc.
• Capitalizing on
overcapacity in Supply
Base
Consolidation • Country Technology
opportunity
External teams driving design
changes for cost and
localization
Unique
spend

© ABB Group
October 18, 2013 | Slide 13
Analyst Presentation - ABB India Ltd
Nashik, Maharasthra
Source: e-SMART
Material cost
Some traction already but significant opportunities

Material Cost as percentage of Revenue

Down from 74% in 2011 to 70% in 2013

© ABB Group
October 18, 2013 | Slide 14
Analyst Presentation - ABB India Ltd
Nashik, Maharasthra
Source: Internal
Manufacturing Operations Assessment
Leveraging Global resources to improve operations

Scores across ABB India Improvements seen in the 2013 independent Re-
assessments done
( 1 – low , 5 – highest)

• 53 assessments completed (36 self, 17

4.0 Independent)
3.7 3.7 3.7 3.7 • Perceptible improvement in last twelve
3.5
3.4
3.3 3.2 months
3.0
3.2 3.2 2.8 Operational
2.8
3.1 Basics
3.0 3.0 2.9 2.6
2.8 2.8 2.8 2.8 Improvement in 5S,
2.7 2.7
2.6 2.6 2.6 2.2 VMS & GEMBA
2.3 2.3 2.3 Performance Quality System
2.2 2.3 2.2
2.0 2.0 2.0
1.7 1.8
1.6 Improvement in
standard work
1.3 measurement system
Sales Operations Flow

People Improved job skills,

skills for improvement 4Q
2012 AVG-SA 2013 AVG-RA
© ABB Group
October 18, 2013 | Slide 15
Analyst Presentation - ABB India Ltd
Nashik, Maharasthra
Sustainability in Supply Base
Moving India Supply base to global levels

 74 suppliers audited between

2009-2012 for adherence to
Supplier Code of Conduct
 Over 90% closure achieved in five
out of six assessment categories
 9 suppliers de-sourced from supply
base due to continued non
Supplier Risk Profile Supplier Risk Profile compliance
2012 2013

Extremely High Risk: Lack of consent to operate /environmental

 Supplier audits conducted by an
licenses, fire protection, worker safety, no ESI/PF for workers, having international third party audit
child labour/forced labour etc
agency
High Risk: Lack of legal documentation, excessive overtime hrs, less
than legal wages, no proper waste management, no health &  106 suppliers trained in ABB
safety/environment risk assessment etc
Medium Risk: Suppliers having assessment score between 60-80%
sustainability requirements during
years 2012-13
Low Risk: Suppliers having assessment score more than 80%

© ABB Group
October 18, 2013 | Slide 16
Analyst Presentation - ABB India Ltd
Nashik, Maharasthra
 October 17th 2013, Giandomenico Testi

ABB
A Technology Leader

© ABB Group
October 18, 2013 | Slide 17
Analyst Presentation - ABB India Ltd
Nashik, Maharasthra
Innovation is key to ABB’s competitive advantage
Leadership built on consistent R&D investment

 More than $1.4 billion invested annually in R&D

 8,000 scientists and engineers, >13% in India
 20,000 engineering resource pool, >10% in India
 Collaboration with 70 universities
 MIT (US), Tsinghua (China), KTH Royal Institute of
Technology (Sweden), Indian Institute of Technology (New
Delhi), ETH (Switzerland), Karlsruhe (Germany), AGH
University of Science and Technology (Poland)
© ABB Group
October 18, 2013 | Slide 18
Analyst Presentation - ABB India Ltd
Nashik, Maharasthra
India contribution to ABB’s technology development
Local content overview
Four global/local Technology Centers
Power High/Medium voltage Switchgears and Power Transformers
Products Complete product portfolio in three manufacturing sites
First 1200 kV transformer and Circuit Breaker developed for and installed at PGCIL

Three global/local Technology Centers

Low Voltage Breakers and switches, control products, wiring accessories and cabinets
Products Strong focus on localizing and adapting product portfolio to local needs and export
Series production manufacturing technologies in focus

Four global/local Technology Centers

Discrete Leadership in Robotics, Drives and PLCs application and engineering Software
Automation Electronic Drives and Converters, Robotics, Motors and Generators
and Motion
Special focus on Photovoltaic and Railways applications and Service technologies

Three global/local Technology Centers

Process Leadership in Plant Automation, Instrumentation and Metal Industries
Automation Turn key projects, DCS systems, P/T/Flow Instruments , Turbochargers
Special focus on engineering for Oil&Gas, Cement, Metals, Minerals, Pulp&Paper

One global Technology Center

Power Leadership in Power Plant and Substation Automation, HVDC and FACTS
Systems Turn key projects, DCS and Electric systems for power plants , Relays and Substation
automation systems, Water Plants automation, Renewables, HVDC and FACTS systems

© ABB Group
ABB India: Presentation to Joe Hogan
Slide 19 | November 8, 2012
Localization
1200kV Transformer & 1200kV Circuit Breaker

© ABB Group
October 18, 2013 | Slide 20
Analyst Presentation - ABB India Ltd
Nashik, Maharasthra
Improving capacity, reliability and efficiency in the grid
A pioneer in smart technologies

Challenge ABB solution

 China: deliver 6,400 MW of  Transmission at ultrahigh
hydropower over 2,000 km voltage
 Minimal losses with direct
current solution

 US: Increase capacity and  World’s largest installation

reliability for Texas utility enabling existing lines to
carry more power
 Also enables integration
of renewable energy

 India: Improve reliability in  Network management with real-

grid serving state of time control
Karnataka (pop. 53 million)
 Key building block for smart grid
 From transmission (400 kV)
to distribution (33 kV)  World’s largest SCADA system
controlling 900 substations
© ABB Group
October 18, 2013 | Slide 21
© ABB Group
October 18, 2013 | Slide 22
Analyst Presentation - ABB India Ltd
Nashik, Maharasthra
Fashioning the world we will live in tomorrow
Tackling challenges with customers and partners

 R&D programs focus on incremental

and breakthrough developments to
address challenges including:
 Integrating renewable power
sources into the grid
 Enhancing power network efficiency,
reliability and flexibility
• Improving industrial resource
efficiency and asset productivity
• Optimizing flexibility and reliability

© ABB Group
October 18, 2013 | Slide 23
Analyst Presentation - ABB India Ltd
Nashik, Maharasthra
 Outlook

© ABB Group
October 18, 2013 | Slide 24
Analyst Presentation - ABB India Ltd
Nashik, Maharasthra
Looking into the future
Mixed macro trends ahead

Growth  No contraction in demand side potential

 Large infrastructure projects yet to revive but new growth areas emerge
 Recent reforms generate hopes, cautiously optimistic

Execution  Increase market penetration through stronger portfolio

 Aggressively capture export opportunities
 Indigenization of power products continues to drive profitability
 Sustain improvements achieved in project execution and risk mitigation
 Growing service revenues leveraging large installed base
 Scale up cost savings and productivity improvements
 Capitalize on improved customer relationship (NPS)

Cash and net  Cash over revenue

working capital  Risk return profiling in long term projects
 Optimize cash conversion cycle

© ABB Group
October 18, 2013 | Slide 25
Analyst Presentation - ABB India Ltd
Nashik, Maharasthra
© ABB Group
October 18, 2013 | Slide 26
Analyst Presentation - ABB India Ltd
Nashik, Maharasthra