This presentation ponders in to the recently announced merger of ABNL with Grasim Industries and demerger of ABFSL and listing of a new entity. The advantages and disadvantages to the shareholders of the merged / demerged entities is listed.

1. MERGER OF
GRASIM AND
ADITYA BIRLA NUVO
Name Roll Nos.
GROUP 1 – BATCH 39 & 40 (FINANCE)
Anirban Bhattacharya KHR2014SMBA39P038
Poonam Pandey KHR2014SMBA39P037
Jyoti Upadhyay Shukla KHR2014SMBA39P064
Jyoti R Choudhary KHR2014SMBA40P024
1

2. KEY TERMS
• MERGER:
An amicable involvement of two or
more companies to form one unit,
and to increase overall efficiency.
• DEMERGER:
A business strategy in which a single
business is broken into components
• COMPANIES INVOLVED:
1. Grasim Industries
2. ABNL: Aditya Birla Nuvo
(Target Entity) Formerly Indian
Rayon and Industries
3. ABFSL: Aditya Birla Financial
Services Ltd. (Demerged
Entity)
The board of directors of the 3
companies approved the scheme at
their respective board meetings
• KEY COMPANIES / BUSINESS -
GRASIM:
 Ultratech Cement
 Textiles
 Chemicals
• KEY COMPANIES / BUSINESS –
ADITYA BIRLA NUVO:
 ABFSL
 Idea Cellular
 Birla Sun Life Insurance
2

3. STEPS IN MERGER
• 2 step Merger / Demerger:
STEP 1:
Merger of ABNL with
Grasim Industries
STEP 2:
Demerger of (ABFSL –
Aditya Birla Financial
Services Ltd.)
STEP 3:
Resulting in a listed financial
services co. with 57% owned
by post-merger Grasim
Industries
3
SPIN OFFMERGER LISTING

4. GRASIM AND ABNL SHAREHOLDING
4
LIC, 6%
Aberdeen,
6%
FPI, 23%
Domestic
MF, 9%
ICICI
Prudential,
4%
GDR
holders,
8%
Retail
holders&
non-
promoters,
12.30%
Promoters
holding,
31%
Grasim shareholding Other
Institutions,
6%
Individuals,
11%
FII, 12%
Domestic MF,
8%
Other Non-
Institutions,
4%
Promoters
holding, 58%
ABNL shareholding

5. 5

6. Public holding in
ABFSL is 26%
6

7. What will shareholders get
Share – Swap ratio:
1. For merger:
i) ABNL Shareholders:
Each shareholder of Aditya Birla Nuvo (ABNL) will get three new equity shares of
Grasim Industries for every 10 equity shares held in ABNL
Shareholder holding 100 shares in ABNL will get 30 shares in Grasim
Hence, Swap ratio is 1:3.33
ii) Grasim shareholder’s:
Will continue to hold equity shares in Grasim (Post merger)
2. For Demerger:
i) ABNL Shareholders:
Will get 2.1 shares of ABFSL for every one share held in the company.
ii) Grasim shareholder’s:
Will get 7 equity shares in ABFSL for each equity share held in Grasim (Post merger)
7

8. Scenario Post merger
Business Pre-merger
holding (%)
Post Merger
holding (%)
Remarks - Overall
Holding
(Increase/Decrease)
Promoters Public TOTAL Promoters Public
Grasim 31.3 68.7 100 39 61 +7.1% increase in
holding by promoters
and similar reduction
for public shareholders
ABNL 58.4 41.6 100 ----- ----- ABNL will cease to
exist after the
merger
8

9. Business Pre-merger
holding (%)
Post Merger
holding (%)
Remarks - Overall Holding
(Increase/Decrease)
ABNL GRASIM TOTAL GRASIM+
ABNL
ABFSL 100 0 100 57 Grasim increases 57%
exposure to Financial
services. ABNL reduces
exposure. [ -ve for ABNL
shareholders]
ABNL 0 2.6 2.6 100 ABNL will cease to exist after
the merger
Idea Cellular 23.3 4.7 28 28 +23.3% increase in stake for
Grasim
Hindalco 1.6 2.6 4.2 4.3 +1.7% increase in stake for
Grasim
Ultratech 0 60.2 60.2 60.2 Maintains
Aditya Birla
Fashion &
Retail
9.1 2.3 11.4 11.4 +9.1% increase in stake for
Grasim
Birla Sun Life
Insurance
51 0 51 57 Will be merged with ABFSL
Scenario Post merger
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10. Scenario Post Merger
Manufacturing
(68%)
Cement
Textiles
Chemicals
Insulators
Solar
Services
(32%)
Financial Services
Telecom
Financing
Insurance
Asset Management
Wealth Management
Payments Bank
Chemical
9%
Textiles,
17%
Others,
1%
Financial
Services,
15%
Telecom,
16%
Cement,
42%
Chemicals Textiles
Others Financial Services
Telecom Cement
10

11. Scenario Post Merger
57%26%
17%
ABFSL Percentage holding post
merger
Post meger
Grasim (i.e.
Grasim + ABNL)
Public & Grasim
shareholders on
proportionate
basis
Promoters
including K M
Birla
Consolidated Financial Performance Post merger
Particulars
FY16 (Rs. Cr)
Grasim
Aditya Birla
Nuvo
Aggregate
Revenue 36,637 23,129 59,766
EBITDA 7,025 4,935 11,961
PAT 2,359 1,886 4,245
Debt 9,732 33,959 43,691
11

12. IDEA CELLULAR – YEARLY RESULTS
12
Idea Cellular
Consolidated Yearly Results ------------------- in Rs. Cr. -------------------
Particulars Mar '16 Mar '15 Mar '14 Mar '13 Mar '12
Net Sales/Income from operations 35,935.29 31,526.87 26,431.97 22,407.44 19,488.68
Other Operating Income 45.66 44.02 86.94 50.21 52.48
Total Income From Operations 35,980.95 31,570.89 26,518.91 22,457.65 19,541.16
EXPENDITURE
Purchase of Traded Goods 28.9 145.17 192.7 231.84 141.37
Employees Cost 1,659.90 1,529.87 1,312.12 1,122.53 949.92
Depreciation 6,650.78 5,303.62 4,519.40 3,477.77 2,981.34
Admin. And Selling Expenses 3,353.25 2,878.27 2,467.36 2,518.76 4,738.20
Other Expenses 17,908.94 16,205.91 14,213.05 12,579.98 8,619.33
P/L Before Other Inc., Int., Excpt. Items & Tax 6,379.18 5,508.05 3,814.28 2,526.77 2,111.00
Other Income 227.12 469.67 -- -- --
P/L Before Int., Excpt. Items & Tax 6,606.30 5,977.72 3,814.28 2,526.77 2,111.00
Interest 1,881.64 1,045.19 770.01 949.45 1,055.73
P/L Before Exceptional Items & Tax 4,724.66 4,932.53 3,044.27 1,577.32 1,055.27
P/L Before Tax 4,724.66 4,932.53 3,044.27 1,577.32 1,055.27
Tax 1,644.73 1,739.62 1,076.45 566.39 332.28
P/L After Tax from Ordinary Activities 3,079.93 3,192.91 1,967.82 1,010.93 722.99
Net Profit/(Loss) For the Period 3,079.93 3,192.91 1,967.82 1,010.93 722.99
Minority Interest -- -- -- -- --
Share Of P/L Of Associates -- -- -- -- --
Net P/L After M.I & Associates 3,079.93 3,192.91 1,967.82 1,010.93 722.99
Equity Share Capital 3,600.51 3,597.84 3,319.63 3,314.32 3,308.85
Reserves Excluding Revaluation Reserves 22,165.11 19,429.47 13,205.42 10,989.04 9,739.45
EPS Before Extra Ordinary
Basic EPS 8.56 9.03 5.93 3.05 2.19
Diluted EPS 8.53 8.99 5.92 3.05 2.18
EPS After Extra Ordinary
Basic EPS 8.56 9.03 5.93 3.05 2.19
Diluted EPS 8.53 8.99 5.92 3.05 2.18
Public Share Holding
No Of Shares (Crores) -- 207.72 179.9 179.36 17.88
Share Holding (%) -- 57.73 54.19 54.12 54.04
Promoters and Promoter Group Shareholding
a) Non-encumbered
- Number of shares (Crores) -- 152.07 152.07 152.07 152.07
- Per. of shares (as a % of the total sh. of prom. and
promoter group)
-- 100 100 100 100
- Per. of shares (as a % of the total Share Cap. of the
company)
-- 42.27 45.81 45.88 45.96

13. ULTRATECH– YEARLY RESULTS
13
UltraTech Cement
Standalone Yearly Results
------------------- in Rs. Cr. -------------------
Mar '16 Mar '15 Mar '14 Mar '13 Mar '12
Net Sales/Income from operations 23,841.03 22,656.48 20,077.88 20,017.94 18,166.38
Other Operating Income 266.33 279.69 201.92 157 146.75
Total Income From Operations 24,107.36 22,936.17 20,279.80 20,174.94 18,313.13
EXPENDITURE
Consumption of Raw Materials 3,553.71 3,280.62 2,910.95 2,792.12 2,377.70
Purchase of Traded Goods 439.68 389.52 309.37 235.71 177.34
Increase/Decrease in Stocks -12.31 -110.06 106.98 -118.19 21.26
Power & Fuel 4,240.81 4,742.89 4,135.42 4,298.94 4,303.97
Employees Cost 1,341.52 1,218.29 1,014.63 968.35 831.04
Depreciation 1,289.03 1,133.11 1,052.26 945.37 902.56
Other Expenses 9,927.83 9,219.88 7,984.55 7,322.53 6,454.40
P/L Before Other Inc. , Int., Excpt. Items & Tax 3,327.09 3,061.92 2,765.64 3,730.11 3,244.86
Other Income 235.16 371.78 329.04 305 371.87
P/L Before Int., Excpt. Items & Tax 3,562.25 3,433.70 3,094.68 4,035.11 3,616.73
Interest 505.29 547.45 319.17 209.71 223.86
P/L Before Exceptional Items & Tax 3,056.96 2,886.25 2,775.51 3,825.40 3,392.87
Exceptional Items -- -- -- -- --
P/L Before Tax 3,056.96 2,886.25 2,775.51 3,825.40 3,392.87
Tax 882.31 871.52 631.04 1,169.97 946.68
P/L After Tax from Ordinary Activities 2,174.65 2,014.73 2,144.47 2,655.43 2,446.19
Prior Year Adjustments -- -- -- -- --
Extra Ordinary Items -- -- -- -- --
Net Profit/(Loss) For the Period 2,174.65 2,014.73 2,144.47 2,655.43 2,446.19
Equity Share Capital 274.43 274.4 274.24 274.18 274.07
Reserves Excluding Revaluation Reserves 20,461.66 18,583.28 16,823.27 14,960.64 12,585.75
Equity Dividend Rate (%) -- 90 90 90 80
EPS Before Extra Ordinary
Basic EPS 79.25 73.44 78.21 96.87 89.26
Diluted EPS 79.2 73.39 78.18 96.85 89.22
EPS After Extra Ordinary
Basic EPS 79.25 73.44 78.21 96.87 89.26
Diluted EPS 79.2 73.39 78.18 96.85 89.22
Public Share Holding
No Of Shares (Crores) -- 10.03 10 9.88 9.49
Share Holding (%) -- 36.56 36.47 36.02 34.64
Promoters and Promoter Group Shareholding
a) Non-encumbered
- Number of shares (Crores) -- 16.93 16.93 17 17.36
- Per. of shares (as a % of the total sh. of prom. and promoter
group)
-- 100 100 100 100
- Per. of shares (as a % of the total Share Cap. of the company) -- 61.69 61.73 62.01 63.34
High
Reserves
of
Ultratech

14. 14
GRASIM YEARLY RESULTSGrasim Industries
Consolidated Yearly Results ------------------- in Rs. Cr. -------------------
Particulars Mar '16 Mar '15 Mar '14 Mar '13 Mar '12
Net Sales/Income from operations 36,217.70 32,437.63 29,008.19 27,639.72 24,987.84
Other Operating Income 419.18 409.71 319.85 264.6 256.46
Total Income From Operations 36,636.88 32,847.34 29,328.04 27,904.32 25,244.30
EXPENDITURE
Consumption of Raw Materials 8,879.61 8,030.39 7,029.44 6,143.15 5,365.67
Purchase of Traded Goods 591.43 556.51 457.12 339.65 261.61
Increase/Decrease in Stocks 31.25 -159.61 45.35 -196.25 -85.82
Power & Fuel 6,217.06 6,452.71 5,653.14 5,603.83 5,460.49
Employees Cost 2,407.19 2,141.16 1,847.09 1,670.63 1,377.17
Depreciation 1,910.96 1,563.22 1,457.48 1,252.06 1,154.41
Other Expenses 11,821.21 10,681.72 9,381.47 8,419.72 7,290.29
P/L Before Other Inc., Int., Excpt. Items & Tax 4,778.17 3,581.24 3,456.95 4,671.53 4,420.48
Other Income 336.36 538.96 576.59 619.53 745.36
P/L Before Int., Excpt. Items & Tax 5,114.53 4,120.20 4,033.54 5,291.06 5,165.84
Interest 751.34 667.39 447.32 324.14 313.64
P/L Before Exceptional Items & Tax 4,363.19 3,452.81 3,586.22 4,966.92 4,852.20
Exceptional Items -27.85 -9.46 -- 204.43 --
P/L Before Tax 4,335.34 3,443.35 3,586.22 5,171.35 4,852.20
Tax 1,211.13 1,015.92 734.79 1,467.21 1,320.77
P/L After Tax from Ordinary Activities 3,124.21 2,427.43 2,851.43 3,704.14 3,531.43
Net Profit/(Loss) For the Period 3,124.21 2,427.43 2,851.43 3,704.14 3,531.43
Minority Interest -910.52 -837.86 -882.76 -1,073.40 -947.13
Share Of P/L Of Associates 145.46 154.23 102.87 73.65 63.16
Net P/L After M.I & Associates 2,359.15 1,743.80 2,071.54 2,704.39 2,647.46
Equity Share Capital 93.36 91.86 91.83 91.78 91.72
Reserves Excluding Revaluation Reserves 25,679.34 22,988.71 21,478.01 19,522.09 16,935.01
EPS Before Extra Ordinary
Basic EPS 252.75 189.84 225.61 294.75 288.65
Diluted EPS 252.52 189.84 225.5 294.51 288.4
EPS After Extra Ordinary
Basic EPS 252.75 189.84 225.61 294.75 288.65
Diluted EPS 252.52 189.84 225.5 294.51 288.4
Public Share Holding
No Of Shares (Crores) -- 5.51 5.51 5.54 5.77
Share Holding (%) -- 60.02 60.05 60.31 62.96
Promoters and Promoter Group Shareholding
a) Non-encumbered
- Number of shares (Crores) -- 2.34 2.34 2.34 2.34
- Per. of shares (as a % of the total sh. of prom. and
promoter group)
-- 100 100 100 100
- Per. of shares (as a % of the total Share Cap. of the
company)
-- 25.51 25.51 25.53 25.55

15. Key observations
• Ultratech (Under Grasim) has a Cash Reserves of 20,461.66 Cr at the end
of March 2016. Grasim on a consolidated basis has a Cash Reserves of
22,988.66 Cr i.e. 89% of the reserves are from Ultratech.
• The new entity will be a holding company which will have various
businesses under it. Holding companies do not get the kind of valuation a
normal company does. Holding companies derive their revenues by way of
dividends only.
• After the merger the cash reserves of Ultratech would be accessible to Idea
cellular.
• From a Grasim’s shareholders point of view, he would continue to hold the
same number of shares of the company and will also receive seven shares
of Aditya Birla Financial Services. Thus a Grasim shareholder has nothing
to lose.
• Debt levels:
15
Company Debt in crores Remarks
GRASIM 12,841 Idea cellular
has high level
of Debt
Ultratech 8,165
Idea Cellular 38,754

16. Pro’s and Cons
GRASIM VIEW:
1. The new entity will have a mixture
of mature and new-age
businesses with steady cash
flows
2. Provides shareholders of Grasim
with exposure to fast growing
sectors, including telecom and
financial sectors
3. Enable ABFSL to raise capital at
lower costs since Grasim has
better credit rating
4. Better liquidity of combined
company
5. ABNL shareholders will get direct
exposure to strong cash flow
generating business
6. All financial business including
Birla sun life and Payments bank
would be listed by May-June next
year as there is a rapid credit
boom for NBFC’s
OUR VIEW / SHAREHOLDER’s VIEW:
1. Grasim cash (Ultratech being cash surplus
company, Reserves of Rs. 20,461.66 Cr) would
be used to fund Idea’s capex requirement. i.e.
attempt to bulk up the balance sheet of Idea
cellular ahead of spectrum auction and
Reliance Jio
2. The exposure of ABNL shareholder’s to high
growth finance business could get diluted. In
contrast Grasim shareholder’s have no option
to choose whether they want stake in financial
business or not.
3. Absolute debt level will go up but Debt : Equity
(net gearing) will not be a problem. Idea
cellular debt will reflect (Rs.37,658 crores) will
reflect in Grasim balance sheet
4. Grasim shares will suffer from holding
company discount (i.e. Grasim M cap is less
than the sum of investments it holds) and Idea
and ABFSL will add to the holding co discount
5. Lower stock valuation for Grasim shareholders
and exposure to unrelated business i.e.
Telecom and Financial services
6. Perceived to be a complex corporate
restructuring
16

17. THANK YOU
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