ASIAN PAINTS

RESULTS FOR THE FINANCIAL YEAR 2001 2002 2003Revenue Account Gross Sales 1,470 1,599 1,807 Net Sales and Operating Income 1,233 1,371 1,535

Growth Rates (%) 13 11 12 Materials Cost 661 728 807

% to Net Sales 53.61 53.04 52.58 Overheads 370 418 459

% to Net sales 29.99 30.46 29.89 Operating Profit 212 241 282 Interest Charges 22 15 8 Depreciation 34 45 49 Profit Before Tax and Exceptional items 156 181 225

% to Net Sales 12.64 13.23 14.65 Growth Rates (%) 9 16 24

Exceptional items - - - Profit Before Tax and after Exceptional items 156 181 225

% to Net Sales 13 13 15 Profit After Tax 106 114 142

Return on average net worth (RONW) (%) 27 28 32 Capital Account Share Capital 64.2 64.2 64.2 Reserves and Surplus 347 346 412 Deferred Tax Liability (Net) - 61 58 Loan Funds 227 111 104 Fixed Assets 381 390 366 Investments 44 63 148 Net Current Assets 214 130 124 Debt-Equity Ratio 0.55:1 0.27:1 0.22:1 Market Capitalisation 1,580 2,106 2,119 Per Share Data Earnings Per Share (EPS) (Rs.) 11.00 11.90 14.80

Dividend (%) 70.00 90.00 110.00 Book Value (Rs.) 64.10 64.00 74.30 Other Information Number of Employees 3,197 3,188 3,327

Corporate Bridge

2004 2005 2006 2007 2008 2009 2010 Average

2,026 2,339 2,777 3,361 4,063 5,003 5,754 1,696 1,955 2,319 2,821 3,419 4,270 5,125 10 15 19 22 21 25 20 16.84 944 1,128 1,352 1,661 1,956 2,607 2,840 55.63 57.73 58.29 58.86 57.21 61.05 55.42 56.34 483 532 616 739 906 1,102 1,275 28.47 27.24 26.54 26.19 26.52 25.80 24.87 27.60 291 325 388 462 617 621 1,154 5 3 4 7 8 10 14 48 48 46 45 44 57 61 238 275 339 410 565 554 1,079 14.02 14.07 14.60 14.53 16.53 12.97 21.06 14.83 6 16 23 21 38 (2) 95 (7) (4) (34) - - (6) 25 231 271 305 410 565 548 1,105 14 14 13 15 17 13 22 14.66 148 174 187 272 375 362 775 29 31 31 40 45 36 56 35.62

95.9 95.9 95.9 95.9 95.9 95.9 95.9 436 476 526 648 833 999 1,461 49 31 29 22 32 48 48 71 88 91 126 95 75 69 344 320 325 347 539 712 1,088 243 258 275 334 423 235 704 64 113 143 211 93 270 (118)

0.13: 1 0.15: 1 0.15:1 0.17: 1 0.09: 1 0.07: 1 0.04: 1 2,914 3,751 6,178 7,336 11,510 7,539 19,593

15.40 18.10 19.50 28.40 39.10 37.78 80.74 85.00 95.00 125.00 130.00 170.00 175.00 270.00 132.00 55.40 59.70 64.90 77.60 96.80 114.10 162.34

3,356 3,550 3,681 3,868 3,924 4,260 4,382

Bridge

ASIAN PAINTSINCOME STATEMENT (in INR mn) 2006 2007 2008INCOME

Sales and operating income (Net of discs) 34,135.8 41,335.2 49,385.6 Less: Excise duty 3,925.5 4,635.5 5,313.3

TOTAL SALES 30,210.4 36,699.7 44,072.3 EXPENDITURE

Material Cost 17,921.0 21,994.0 25,776.4 Employee Cost 2,233.3 2,620.4 3,066.6 SG&A costs 6,139.2 7,304.7 8,623.5

EBITDA 3,916.9 4,780.6 6,605.8 Less : Interest 114.3 189.1 211.6 Less : Depreciation/Amortisation 596.9 615.4 591.7 Add: Other Income 320.3 372.5 596.0

EBT 3,526.0 4,348.6 6,398.5 Add/(Less) : Exceptional Item (76.0) (77.6) (68.4)

PROFIT BEFORE TAX AND PRIOR PERIOD ITEMS 3,450.0 4,271.0 6,330.1 (Less) : Prior period items (Net) (10.3) 26.5 (15.9)

PROFIT BEFORE TAX 3,439.7 4,297.5 6,314.2 Less: Provision for Taxation:Current Tax 1,238.3 1,483.1 1,847.9 Deferred Tax (Refer Note B - 8 in Schedule ‘M’) (17.8) (28.8) 105.6 Fringe Benefit Tax 54.4 48.1 64.3 (Excess) Tax Provision for earlier years 47.9 (35.8) 15.9

PROFIT AFTER TAX 2,116.8 2,830.9 4,280.5 Less: Minority Interest 23.3 20.6 188.7

NET PROFIT ATTRIBUTABLE TO SHAREHOLDERS 2,093.6 2,810.3 4,091.8 Add : Balance brought forward from previous year 1,000.0 1,100.0 1,500.0

AMOUNT AVAILABLE FOR APPROPRIATION 3,093.6 3,910.3 5,591.8 APPROPRIATIONSDividend to shareholders of parent company:Equity Shares - Interim dividend 431.6 1,151.0 623.4 Proposed Final dividend 767.4 95.9 1,007.1 Tax on Dividend (includes tax on proposed div) 171.0 180.6 277.2 Transfer to General Reserve 651.4 982.8 1,684.1 Balance carried to Balance Sheet 1,100.0 1,500.0 2,000.0

3,121.5 3,910.3 5,591.8 Per share data

EPS (Rs.) Basic and Diluted - before exc item 22.12 29.30 43.37 EPS (Rs.) Basic and Diluted - after exc item 22.12 29.30 42.66 DPS (Rs) 12.50 13.00 17.00 No of shares - eop 95.92 95.92 95.92

Key Figures

Corporate Bridge

Gross Profit 12,289.3 14,705.7 18,295.9 EBITDA 3,916.9 4,780.6 6,605.8 Operating Profit (EBIT) 3,320.0 4,165.2 6,014.1 PBT 3,526.0 4,348.6 6,398.5 Net Income 2,093.6 2,810.3 4,091.8

MarginsGross Profit 40.68% 40.07% 41.51%EBITDA 12.97% 13.03% 14.99%Operating Profit (EBIT) 10.99% 11.35% 13.65%PBT 11.67% 11.85% 14.52%Net Income 6.93% 7.66% 9.28%

Purchases 23,085.4 26,936.4

AssumptionsSales (Growth - YoY) 21.48% 20.09%Material Cost (as a % of Sales) 59.32% 59.93% 58.49%OverheadsEmployee Cost (as a % of sales) 7.39% 7.14% 6.96%SG&A costs (as a % of sales) 20.32% 19.90% 19.57%

Other income (Growth - YoY) 16.32% 60.00%Other income (as a % of sales) 1.1% 1.0% 1.4%Effective Tax Rate (tax /EBT) 38.5% 34.1% 32.2%Dividend Payout Ratio 57.3% 44.4% 39.8%Divident Tax Rate 14% 14% 17%Minority Interest as % of PAT 1.1% 0.7% 4.4%

We will wait for another 2minutes

2009 2010 2011 2012 2013 2014 2015

60,445.1 71,065.6 83,614.7 5,806.1 4,256.2 6,552.3

54,639.0 66,809.4 77,062.4 88,621.8 101,915.0 117,202.3 134,782.6

33,706.4 37,579.6 44,745.6 51,400.6 59,110.7 67,977.3 78,173.9 3,715.2 4,362.8 4,539.9 5,317.3 6,114.9 7,032.1 8,087.0 10,516.7 12,593.0 14,647.2 16,838.1 19,363.9 22,268.4 25,608.7 6,700.7 12,274.0 13,129.7 15,065.7 17,325.6 19,924.4 22,913.0 263.2 284.7 222.3 223.0 223.0 223.0 223.0 743.8 835.6 1,131.3 1,329.3 1,528.7 1,758.0 2,021.7 510.1 1,405.0 826.3 886.2 1,019.2 1,172.0 1,347.8

6,203.8 12,558.7 12,602.4 14,399.6 16,593.0 19,115.4 22,016.2 (12.4) 11.5 - - - -

6,191.4 12,570.2 12,602.4 14,399.6 16,593.0 19,115.4 22,016.2 (22.7) - - - -

6,168.7 12,570.2 12,602.4 14,399.6 16,593.0 19,115.4 22,016.2 4,319.9 4,977.9 5,734.6 6,604.9

1,793.4 3,731.8 3,555.0 163.2 55.4 281.5 73.6 - - (56.3) (56.1) (47.6) 4,194.8 8,839.1 8,813.5 10,079.7 11,615.1 13,380.8 15,411.3 216.4 482.7 381.1 453.6 522.7 602.1 693.5 3,978.4 8,356.4 8,432.4 9,626.1 11,092.4 12,778.7 14,717.8 2,000.0 2,300.0 6,000.0

5,978.4 10,656.4 14,432.4 dividends n minority shareholders - not paid in cash taxes -> PAID in cash

623.5 815.3 815.3 1,055.1 1,774.5 2,254.1 3,369.2 3,882.4 4,472.5 5,151.2 288.8 433.3 501.1 539.1 621.2 715.6 824.2 1,711.0 1,633.3 4,861.9 2,300.0 6,000.0 6,000.0

5,978.4 10,656.4 14,432.4

41.61 87.00 87.91 41.48 87.12 87.91 17.50 95.92

Bridge

20,932.6 29,229.8 32,316.8 6,700.7 12,274.0 13,129.7 5,956.9 11,438.4 11,998.4 6,203.8 12,558.7 12,602.4 3,978.4 8,356.4 8,432.4

38.31% 43.75% 41.94%12.26% 18.37% 17.04%10.90% 17.12% 15.57%11.35% 18.80% 16.35%

7.28% 12.51% 10.94%

34,255.8 39,448.9 48,241.1 51,020.4 61,011.8 70,163.6 80,688.1

23.98% 22.27% 15.35% 15.00% 15.00% 15.00% 15.00%61.69% 56.25% 58.06% 58.00% 58.00% 58.00% 58.00%

6.80% 6.53% 5.89% 6.00% 6.00% 6.00% 6.00%19.25% 18.85% 19.01% 19.00% 19.00% 19.00% 19.00%

-14.41% 175.44% -41.19%0.9% 2.1% 1.1% 1.00% 1.00% 1.00% 1.00%

32.0% 29.7% 30.1% 30.00% 30.00% 30.00% 30.00%42.2% 31.0% 36.4% 35.00% 35.00% 35.00% 35.00%

17% 17% 16% 16.00% 16.00% 16.00% 16.00%5.2% 5.5% 4.3% 4.50% 4.50% 4.50% 4.50%

ASIAN PAINTS

BALANCE SHEET (in INR m) 2006 2007FUNDS EMPLOYED

Shareholders' Funds Share Capital 959.2 959.2 Reserves and Surplus 5,503.3 6,818.7 Shareholders' equity 6,462.5 7,777.9 Loan Funds Secured Loans 1,127.1 1,211.0 Unsecured Loans 1,485.7 1,850.7 Loans 2,612.8 3,061.7 Deferred Tax Liability (Net) 340.7 267.9 Minority Interest 600.3 600.8

Total 10,016.3 11,708.3

APPLICATION OF FUNDS Goodwill on consolidation 448.7 468.6 Fixed Assets Gross Block 9,765.6 10,831.5 Less: Depreciation/Amortisation 5,584.4 6,037.7 Net Block 4,181.2 4,793.8 Add : Capital Work in Progress 337.4 137.8

Net Fixed Assets 4,518.6 4,931.6 Investments 1,640.6 1,927.2

Total Long Term Assets 6,607.8 7,327.4 Current Assets, Loans and AdvancesCash and Bank Balances 734.1 1,053.9 Interest accrued on investments - 0.3 Inventories 4,888.7 5,980.1

Current Asset Sundry debtors (receivables) 3,475.2 4,206.1 Other Current Assets 611.2 693.6

Current Asset Loans and Advances 745.2 979.3 Total Current Assets 10,454.4 12,913.3 Current Liabilities and Provisions

Current Liabilities 5,787.4 7,870.4 Provisions 1,258.5 662.0 Total Current Liabilities 7,045.9 8,532.4 Net Current Assets 3,408.5 4,380.9

Total Total 10,016.3 11,708.3

check (moment of truth!) ( A = L + E) - -

Corporate Bridge

Schedule GCurrent Liabilities 5787.37 7870.4

1 Acceptances 1,227.48 1729.32 Sundry Creditors 3296.3 4485.3

Trade (payables) 2,266.92 3692.8Others 1,029.38 792.5

3 Investor Education etc 24.15 62.94 Other Liabilities 1,239.44 1592.9

Assumptions:

Fixed Assets B Net Fixed Assets - OpeningA Add: CapexA Add: Acquisitions / (Disposals)/WIP addnsS Less: DepreciationE Net Fixed Assets - Ending

Capex (as a % of sales) 2.9% 2.2%Depreciation (as a % of sales) 2.0% 1.7%

DebtAverage Debt 2,837.2 Interest paid 189.1 Interest cost % 6.7%

Cash and Bank Balances Interest earnedInterest rate %

Ratio Analysis

Solvency Ratios Current ratio 1.5 1.5 Quick ratio 0.8 0.8 Cash ratio 0.1 0.1

Turnover Ratios Receivables turnover 9.6 Inventory turnover 4.0 Payables turnover 7.7

Sales Average receivables collection period 38.2 Material costs Average inventory processing period 90.2 Purchases Average payment period 47.1

Cash Conversion Cycle 81.3

Other Receivables Other Current Assets as % of Sales 2.0% 1.9%Loans and Advances as % of Sales 2.5% 2.7%

Other PayablesAcceptances as % of COGS 6.8% 7.9%Others Creditors as % of COGS 5.7% 3.6%Investor Education etc as % of COGS 0.1% 0.3%Other Liabilities as % of COGS 6.9% 7.2%

Operating Efficiency Total asset turnover 3.4 Net fixed asset turnover 7.8 Equity turnover 5.2

Operating Profitability Gross Profit Margin 40.7% 40.1% Operating Profit Margin 11.0% 11.3% Net Profit Margin 6.9% 7.7%

Return on total capital 44.0% Return on total equity 39.5%

ROE DuPont Analysis Profit Margin 7.7% Asset Turnover 3.4 Financial Leverage 1.53 ROE 39.5%

Financial Risk Ratios Debt to equity ratio 0.4 0.4 Debt ratio 0.3 0.3 Interest coverage ratio 34.3 25.3

2008 2009 2010 2011 2012 2013 2014 2015

959.2 959.2 959.2 959.2 959.2 959.2 959.2 959.2 8,864.5 11,072.5 16,140.6 20,915.0 26,632.9 33,221.8 40,812.4 49,554.7 9,823.7 12,031.7 17,099.8 21,874.2 27,592.1 34,181.0 41,771.6 50,513.9 - 1,211.2 1,037.0 637.0 499.7 499.7 499.7 499.7 499.7 1,540.9 2,049.2 1,655.3 1,847.3 1,847.3 1,847.3 1,847.3 1,847.3 2,752.1 3,086.2 2,292.3 2,347.0 2,347.0 2,347.0 2,347.0 2,347.0 390.8 533.1 562.3 851.8 851.8 851.8 851.8 851.8 573.7 755.7 944.5 1,098.9 1,552.5 2,075.2 2,677.3 3,370.8 13,540.3 16,406.7 20,898.9 26,171.9 32,343.4 39,455.0 47,647.7 57,083.5

443.5 505.5 367.3 371.9 371.9 371.9 371.9 371.9

12,112.2 14,614.1 15,003.9 19,877.5 6,336.6 6,483.8 6,275.7 7,150.7 5,775.6 8,130.3 8,728.2 12,726.8 1,141.8 921.1 4,072.3 433.2

6,917.4 9,051.4 12,800.5 13,160.0 13,603.1 14,112.7 14,698.7 15,372.6 2,766.5 784.0 6,241.1 9,219.5 9,219.5 9,219.5 9,219.5 9,219.5

10,127.4 10,340.9 19,408.9 22,751.4 23,194.5 23,704.1 24,290.1 24,964.0

1,107.1 2,103.7 1,058.3 1,330.4 8,081.5 14,853.0 22,334.4 30,952.3 0.9 5.5 2.1 2.0 2.0 2.0 2.0 2.0 7,140.1 7,689.5 9,558.8 13,054.3 12,674.1 14,575.2 16,761.5 19,275.8 4,603.3 5,719.2 5,425.2 5,855.3 6,070.0 6,980.5 8,027.6 9,231.7 559.6 491.2 646.3 893.1 886.2 1,019.2 1,172.0 1,347.8 1,525.2 1,978.0 1,746.2 2,054.4 2,304.2 2,649.8 3,047.3 3,504.3 14,936.2 17,987.1 18,436.9 23,189.5 30,018.0 40,079.7 51,344.7 64,313.9

9,859.3 10,146.8 13,796.5 16,403.7 16,960.8 19,825.3 22,799.1 26,218.9 1,664.0 1,774.5 3,150.4 3,365.3 3,908.2 4,503.5 5,188.1 5,975.4 11,523.3 11,921.3 16,946.9 19,769.0 20,869.0 24,328.8 27,987.2 32,194.3 3,412.9 6,065.8 1,490.0 3,420.5 9,148.9 15,750.9 23,357.6 32,119.5 13,540.3 16,406.7 20,898.9 26,171.9 32,343.4 39,455.0 47,647.7 57,083.5

- - - - - - - - where is the ERROR! - NO ERROR as such

Corporate Bridge

9859.3 10146.8 13796.5 16403.7 16,960.8 19,825.3 22,799.1 26,218.9 2183.2 1795.4 2987.7 3152.7 3,598.0 4,137.7 4,758.4 5,472.2 5719.6 5541.5 7183.2 8913.8 8,376.9 9,953.8 11,446.8 13,163.9 4539.4 4416.4 5993.8 7686.1 6,989.1 8,357.8 9,611.5 11,053.2 1180.2 1125.1 1189.4 1227.7 1,387.8 1,596.0 1,835.4 2,110.7

31.7 29.1 34.5 41.4 51.4 59.1 68.0 78.2 1924.8 2780.8 3591.1 4295.8 4,934.5 5,674.6 6,525.8 7,504.7

13,160.0 13,603.1 14,112.7 14,698.7 1,772.4 2,038.3 2,344.0 2,695.7

(1,329.3) (1,528.7) (1,758.0) (2,021.7) 13,160.0 13,603.1 14,112.7 14,698.7 15,372.6

7.0% 5.7% 5.9% 2.0% 2.00% 2.00% 2.00% 2.00%1.3% 1.4% 1.3% 1.5% 1.50% 1.50% 1.50% 1.50%

2,906.9 2,919.2 2,689.3 2,319.7 2,347.0 2,347.0 2,347.0 2,347.0 211.6 263.2 284.7 222.3 223.0 223.0 223.0 223.0

7.3% 9.0% 10.6% 9.6% 9.5% 9.5% 9.5% 9.5%

1.3 1.5 1.1 1.2 0.7 0.9 0.5 0.5 0.1 0.2 0.1 0.1

10.0 10.6 12.0 13.7 3.9 4.5 4.4 4.0 6.5 7.6 7.6 7.1

if in 365 days -> material cost is 51400 what will be the figure for 90 days?

36.5 34.5 30.4 26.7 25.0 25.0 25.0 25.0 92.9 80.3 83.8 92.2 90.0 90.0 90.0 90.0 55.8 47.7 48.2 51.8 50.0 50.0 50.0 50.0 73.6 67.1 66.0 67.2 65.0 65.0 65.0 65.0

1.3% 0.9% 1.0% 1.2% 1.0% 1.0% 1.0% 1.0%3.5% 3.6% 2.6% 2.7% 2.6% 2.6% 2.6% 2.6%

8.5% 5.3% 8.0% 7.0% 7.0% 7.0% 7.0% 7.0%4.6% 3.3% 3.2% 2.7% 2.7% 2.7% 2.7% 2.7%0.1% 0.1% 0.1% 0.1% 0.1% 0.1% 0.1% 0.1%7.5% 8.3% 9.6% 9.6% 9.6% 9.6% 9.6% 9.6%

3.5 3.6 3.6 3.3 7.4 6.8 6.1 5.9 5.0 5.0 4.6 4.0

41.5% 38.3% 43.8% 41.9%13.6% 10.9% 17.1% 15.6%

9.3% 7.3% 12.5% 10.9%

52.3% 44.8% 65.8% 55.8%46.5% 36.4% 57.4% 43.3%

9.3% 7.3% 12.5% 10.9% 3.5 3.6 3.6 3.3 1.43 1.37 1.28 1.21

46.5% 36.4% 57.4% 43.3%

0.3 0.3 0.1 0.10.2 0.2 0.1 0.1

31.2 25.5 43.1 59.1

ASIAN PAINTSSource:

CASH FLOW STATEMENT (in INR mn) 2006 2007 2008 2009Cash Flow from Operating Activities:

Profit before tax and prior period items 3,431.4 4,271.0 6,330.1 6,191.4 Adjustment for: Depreciation/Impairment 606.2 611.4 591.7 743.8 Impairment of Goodwill 76.0 - - 12.4 Prior period item (Net) (10.3) 26.5 (15.9) (22.7)Profit on sale of investments (3.6) 70.8 (16.0) (1.3)Profit on disposal of subsidiaries 10.1 9.7 68.4 - Gain on disposal of assets (2.2) (14.7) (37.8) (65.4)Interest Expense 114.3 189.1 211.6 263.2 Interest Income (17.5) (14.3) (44.7) (56.9)Dividend Income (58.1) (115.3) (245.4) (140.8)Effect of exchange rates on op cashflows - - (177.7) 320.6

Operating Profit before Working Capital changes 4,146.3 5,034.2 6,664.3 7,244.3 - Adjustment for: Changes in working capital (886.4) (869.9) 39.9 (1,431.1)

Asset Trade Receivables (sundry debtors) (636.7) (1,111.8) (888.5) (922.2)Asset Other Receivables (loans & advances) - - - - Asset Inventories (343.2) (1,044.8) (1,194.3) (549.4)Liabiliti Trade and other payables (current liablilities) 93.6 1,286.7 2,122.7 40.5 Assets Changes in other current assets - - - -

Cash generated from Operations 3,259.9 4,164.3 6,704.2 5,813.2 Income tax paid (net of refund) (1,473.1) (1,585.0) (1,906.0) (1,919.2)Others

Net cash generated from operating activities 1,786.8 2,579.3 4,798.2 3,894.0 Cash Flow from Investing Activities:

Purchase of Fixed Assets / Capex (867.2) (819.5) (3,080.5) (3,100.5)Proceeds from sale of Fixed Assets 39.9 133.7 262.4 217.5 Purchase of Investment (797.2) (395.6) (1,981.5) - Sale of Investment 298.5 54.0 1,158.3 2.1

investmInterest received 17.6 14.0 44.7 52.3 Dividend received 58.1 115.3 245.4 140.8 Cash outflow on additional stake in subsidiary - (269.4) (3.6) (12.7)Cash inflow arising on disposal of subsidiary - 72.8 6.9 -

Net cash used in investing activities (1,250.3) (1,094.7) (3,347.9) (2,700.5)Cash Flow from Financing Activities

debt Proceeds from long term borrowings 494.7 - 224.3 - debt Proceeds from short term borrowings 56.7 736.8 - - debt Repayment of long term borrowings (333.7) (280.5) - (25.6)debt Repayment of short term borrowings - - (380.8) (15.6)

Corporate Bridge

Interest Paid (114.3) (189.1) (211.6) (263.2)Dividend and Dividend tax paid and Provisions (519.2) (1,374.9) (968.2) (1,999.3)

Net cash used in financing activities (415.7) (1,107.7) (1,336.3) (2,303.7)Net Inc/(Dec) in Cash and Cash Equivalents 120.8 376.9 114.0 (1,110.2)

Cash and Cash Equivalents - bop 608.2 734.1 1,053.9 3,088.8 Net effect of changes in exchange rate 5.1 (57.1) (60.8) 125.1

Cash and Cash Equivalents - eop 734.1 1,053.9 1,107.1 2,103.7

Net change in Cash = CFO + CFF + CFI

10.0

2010 2011 2012 2013 2014 2015

12,572.4 12,602.4 14,399.6 16,593.0 19,115.4 22,016.2 - - 835.6 1,131.3 1,329.3 1,528.7 1,758.0 2,021.7 - - (2.2) - (627.2) (4.5) (11.5) - (78.8) (27.1) 284.7 222.3 223.0 223.0 223.0 223.0 (110.6) (104.8) (226.2) (354.7) (172.9) (161.0)

12,463.3 13,303.9 15,951.9 18,344.7 21,096.4 24,260.9

1,337.7 (1,767.0) 479.7 (425.7) (809.9) (931.4) (508.8) (819.4) (214.68) (910.50) (1,047.07) (1,204.13) - - (249.8) (345.6) (397.5) (457.1) (1,913.5) (3,495.5) 380.17 (1,901.12) (2,186.29) (2,514.23) 3,760.0 2,547.9 557.12 2,864.44 2,973.79 3,419.86 - 6.88 (132.93) (152.87) (175.80)

13,801.0 11,536.9 16,431.6 17,919.0 20,286.5 23,329.5 (3,169.4) (3,924.2) (4,319.89) (4,977.90) (5,734.62) (6,604.85) cash

10,631.6 7,612.7 12,111.8 12,941.1 14,551.9 16,724.6

(3,953.1) (1,561.0) (1,772.44) (2,038.30) (2,344.05) (2,695.65) 120.6 57.9 (543.6) (3,109.9) 986.6 4.5 114.0 104.9 226.2 354.7 - 59.1

(2,990.2) (4,148.9) (1,772.4) (2,038.3) (2,344.0) (2,695.7)

119.3 (145.5) (63.8) (529.7) -

(284.7) (222.3) (223.0) (223.0) (223.0) (223.0) (2,358.9) (3,168.3) (3,365.3) (3,908.2) (4,503.5) (5,188.1)

(3,318.8) (3,335.1) (3,588.3) (4,131.2) (4,726.5) (5,411.1) 4,322.6 128.7 6,751.1 6,771.6 7,481.3 8,617.9 2,103.7 6,374.7 1,330.4 8,081.5 14,853.0 22,334.4 (51.6) 11.9 6,374.7 6,515.3 8,081.5 14,853.0 22,334.4 30,952.3

BS 1,330.40 ending Cash Flows -> linked finally to the BS cash both should match 5,184.90

Net change in Cash = CFO + CFF + CFI

CB Research & Analytics Asian Paints Model Valuation Sheet

DCF SummaryNet Income

+ Depreciation+ Interest*(1-T)- Capex

+/- Changes in working capitalFree Cash Flow to Firm

DateFCFF (explicit forecast)Terminal value

Present value of "explicit forecast period" - till 2015EPV of Terminal Value

Valuation Assumptions

Terminal growth rate 5.0%Cost of debt 10.0%

Beta 1.1

8.0%Market Premium 5.0%

Cost of Equity

WACC Calculation Total DebtShareholders' equityCapitalization:Debt: EquityDebt: Total CapitalEquity: Total Capital

Cost of Equity

WACC

CB Research & Analytics Asian Paints Model

Risk free rate (rf )

EV Computation Present value of "explicit forecast period" - till 2015EPV of Terminal ValueTotal Valuation

Less: DebtLess: Minority InterestAdd: Cash and bank depositsOther adjustments:Add: InvestmentsAdd: Other non-operating assets

Intrinsic Value (in mn)No of Shares (in mn)Share Price (INR)

SENSITIVITY ANALYSIS - 4.0%

12.1%12.6%13.1%13.6%14.1%

Asian Paints Model Historical Forecast

FY 09 FY 10 FY 11E FY 12E FY 13E FY 14E FY 15E 2009 2010 2011 2012 2013 2014 2015

2023 2011 2012 2013 2014 2015

Asian Paints Model

5.0% 5.5% 6.00%

2016 2017 2018 2019 2020 21,889 24,402 27,217 30,370 33,901 - - - - - - - - - - - - - - - 7,141 - - - - 29,029 24,402 27,217 30,370 33,901

FYE 31-Mar-11Date 7-Apr-23

Days -4390

Relative Valuation Asian Paints Corporate Bridge Academy (www.corporatebridge.net / www.cbacademy.in / cbjobs.in) (In Crores)

Peer CompaniesAsian Paints Nerolac Berger Paints Akzo Nobel

Debt CashMarket PriceShares OutstandingEquity ValueEnterprise Value

Capital Invested

(In Crores)SalesExcise

Net SalesCOGSTotal ExpensesOperating ExpensesEBITDAGP MarginsEBITDA Margins

Net Profit Net Profit Margins

Total Assets

Multiple AnalysisP/EEV/SalesEV/EBITDAP/Sales

Peer CompaniesShalimar Paints

Asian PaintsFIXED ASSETS SCHEDULE Source: AR 2010 ,pg no 45(Rs. in Crores)

Gross Block Depreciation/Amortisation Impairment Net Block

SCHEDULE D : FIXED ASSETS Additions

Tangible Assets : Freehold Land 90.38 - 0.50 - 90.88 - - - - - - - - - 90.88 90.38 Leasehold Land 28.33 - 66.75 - 95.08 1.25 - 0.58 - 1.83 - - - - 93.25 27.08 Buildings 206.26 12.35 11.02 0.16 229.47 46.93 1.53 6.37 0.04 54.79 - - - - 174.68 159.33 Plant and Machinery 575.71 - 40.01 14.49 601.23 302.68 - 39.54 13.20 329.02 7.92 0.15 0.99 7.08 265.13 265.11

72.83 - 0.21 53.38 19.66 52.60 - 2.21 40.11 14.70 17.49 - 13.01 4.48 0.48 2.74 Scientific Research: Equipment 35.22 - 1.89 0.98 36.13 11.31 - 3.66 0.04 14.93 0.48 - - 0.48 20.72 23.43 Buildings 37.02 - 0.36 - 37.38 0.90 - 1.24 - 2.14 - - - - 35.24 36.12 Furniture and Off. Equipment 28.43 - 5.60 1.13 32.90 16.99 - 2.75 1.02 18.72 1.31 0.01 0.08 1.24 12.94 10.13 Vehicles 2.62 - 0.05 1.16 1.51 1.76 - 0.26 0.87 1.15 - - - - 0.36 0.86 Leasehold improvements 3.45 - - - 3.45 0.84 - 1.12 - 1.96 - - - - 1.49 2.61 Intangible Assets : Trademark 11.92 - - - 11.92 11.92 - - - 11.92 - - - - - - Software 24.76 - 10.02 - 34.78 19.64 - 2.85 - 22.49 - - - - 12.29 5.12 Total 1,116.93 12.35 136.41 71.30 1,194.39 466.82 1.53 60.58 55.28 473.65 27.20 0.16 14.08 13.28 707.46 622.91

Previous year 937.89 - 252.75 73.71 1,116.93 469.41 - 57.05 59.64 466.82 39.65 0.10 12.55 27.20 622.91

As at01.04.09

Assetsacquired

on merger

Additionsduring

the year

Deductionsand / or

adjustmentsAs at

31.03.10As at

01.04.09

Assetsacquired

on merger*

Additionsduring

the year

Deductionsand / or

adjustmentsAs at

31.03.10As at

01.04.09

Deductionsand / or

adjustmentsAs at

31.03.10As at

31.03.10As at

31.03.09

Assets given on Operating Lease : Tinting systems

ASIAN PAINTS Production Details:

Items Unit Location Installed Capacity Production Utilization

2010 2009 2010 2009 2010 2009a) Paints, enamels MT/KL In-house 444,150 404,150 411,369 354,370 93% 88%

and varnishes Contract Manufacture/ Purchase - - 182,059 141,616

b) Synthetic Resins MT In-house 138,880 119,380 98,676 71,979 71% 60%and Polymers (Mainly for captive consumption)

c) Phthalic Anhydride MT Ankleshwar 29,796 25,200 23,721 19,941 80% 79%d) Maleic Acid MT Ankleshwar 4,860 5,400 4,267 3,073 88% 57%e) Pentaerythritol MT Cuddalore 5,400 5,400 4,700 4,500 87% 83%f) Sodium Formate MT Cuddalore 3,300 3,240 2,406 2,080 73% 64%g) Formaldehyde

(100%)(8) MT Cuddalore 8,100 8,100 4,944 5,363 61% 66%Purchase - - 1,023 -