A green alternative to air conditioning..…

Sumaya HMX Systems Ltd.

Bangalore 560 058November 2006

Objective� About HMX – introduce company / product

� Background

� Product - Ambiator

� Market

� Product Positioning

� Market details

� Carbon Advantages

� Business this far

� Performance

� Infrastructure available

� Promoters

� The way forward

� Growth plans

� Strategy

� Financials

� Funding Sought

About HMX

� HMX has developed an innovative product Ambiator to the Indian market, and successfully commercialized the same.

� Ambiator is an energy efficient and eco friendly alternative to air conditioner

Background

Ambiator

� Products working on similar principles are called IDEC systems or Two stage evaporative cooling systems

� Identified as Zero ODP and Zero GWP systems

� Contemporary research references available from leading institutions

� DOE – USA

� Lawrence Berkeley lab

� California Energy Commission

Ambiator - features

� Provides 100% fresh air

� Filtered fresh cool air

� Ambiator Cools air to sensible levels without CFC’s, as it does not have a compressor

� Typically consumes about 35% power compared to Air conditioning

What is new in Ambiator?

� Ambiators represent a new technology

� These incorporate a Wet plate, Cross flow heat exchanger, where based on Indirect Evaporative Cooling, sensible cooling is achieved.

� This forms the core technology of Ambiator.

Product positioning

� Our positioning to market is as under:

Thermal Comfort 1 3 6 8 10

///_______////__________////_______////____________

Fan Air Ambiator Air

(Ventilation) Cooler Conditioning

� Product positioning validated by repeat orders from leading customers

� Large Institutional projects such as DNA, IMTMA

Product Evaluation

� Product endorsed by TERI, GTZ n EMC (GOI)

� Report reference DCS –001

� Report confirms

� Energy saving potential of Ambiators

� Quantifies Carbon emission reduction

Carbon advantages..

� Ambiator is Eco friendly and Energy efficient thus offers Carbon Emission Reduction (CER)

� Ambiator offers CER, thus offers huge financial advantages – 0.00085 per CFM/ Hour

� TERI report quantifies CER advantages

� Ratification of Kyoto Protocol will further the markets for products that offer CER

Market Acceptance of the product

� Early development phase was challenging, but have been able to make an impact.

� Customers include :

� Software: Wipro, HP, PCS,Polaris

� Engineering:Bosch, ABB, Ford

� Pharma: Sunpharma, Glenmark pharma

� Others: IMTMA, Taj Hotels, DNA

HVAC Market in India

� Total Market USD 1.6 billion

� Air conditioners

� 0.9 billion $

� Air Coolers

� 0.35 billion $

� Ventilation

� 0.35 billion $

� Growing at 30% p.a

HVAC Market in india

Air conditioners

Air Cooliers

Ventilation

Market by Volume..

� Total Market 1.5 Billion CFM

� A.C – 450 M.CFM

� Air cooling –470 M.CFM

� Ventilation – 510 M.CfM

Market - Million CFM

Air conditioning

31%

Air cooling

33%

Ventilation

36% Air conditioning

Air cooling

Ventilation

Comparison

8 to 1025 to 50n.aBtu/wattsEER

2020NoneMicronsFiltration

5100100%Fresh air

45 to 5555 to 65>75%Rh

22 to 2523 to 2730 to 35Deg.CIndoor temp

454545Deg.COutdoor temp

A.CAmbiatorAir coolerUnitsDescription

Infrastructure available

� Owns Manufacturing unit at Bangalore

� 8000 sft of factory

� 1600 sft of office

� Designs and standardization of models complete

� Vendors and associates developed

� Networked office and factory

Personnel

� HMX has its core team of skilled technicians, operators

� HMX to focus on building its team of Engineers and executives

Promoters

Promoters

� A.Vaidyanathan – B.E., MBA ( IIM B)

� Over 2 decades techno commercial experience in Industry

� H. Indushekar – B.E

� Over 2 decades of experience in Capital equipment manufacture

The way forward…

Consolidate on good start..

� HMX believes it has reached an inflection point

� HMX has got Ambiator and its positioning accepted in the market

� Funds required to leverage its position and accelerate its growth

Growth Plan

� HMX plans to consolidate its presence and grow to a Rs.1700 Million (about $ 38 million) company in 5 years time� HMX has a comprehensive business plan and strategy.

� The key elements required for acceleration in place

� Product Acceptance – various segments

� Product Standardization & Coinage

Key drivers for market….

� Changing Demographic profile

� Higher expectations of Workers & Employees

� Changing User requirement

� Seeking World class facilities

� Clean and Quality production facility

� Key sectors driving growth

� Services – Software, Finance, Telecom

� Manufacturing – Automobiles, Components

� Exports – Textiles, Gems and Jewellery

� Indian GDP growing at over 8% p.a

Important external factors

� Global factors � Wellness awareness

� Fresh air vs. Re-circulated air� SARS

� Bird Flu

� Green Compulsions

� Newer standards – adaptive models

� India perspective� Tropical realities

� Energy costs

Innovation / technology lead

� HMX plans to stay at the leading edge of technology by integrating appropriate developments - relevant to add value proposition to customers

� HMX has lined up two other products to retain the edge� Hybrid air conditioners

� Economizers

Market and Marketing related

� Distinct positioning as an innovative company

� Excellent set of referral customers and repeat orders from them

� Awareness among opinion makers

� Leading consultants

� Architects

� Institutions including Air conditioning companies

Funding sought

� Funding sought

� Equity of Rs.45 Million ($ 1 Million) during year1

� Debt of Rs.60 Million ($1.2 Million) during Year 2

Projections and profitability

Current Year Year Year Year Year

PARTICULARS Year 1 2 3 4 5

A SALES & PROFIT

1 Net sales 78.05 174.22 372.95 707.15 1189.53 1709.34

2 Operating profit 9.83 27.78 90.98 224.20 434.10 636.48

3 EBIDTA 15.10 34.62 111.66 253.96 469.71 680.05

4 PBT 10.38 23.38 86.73 220.20 430.10 632.48

5 PAT 6.54 14.73 54.64 138.73 270.96 398.46

B PROFITABILITY RATIOS

6 EBIDTA / Net Sales 19.35% 19.87% 29.94% 35.91% 39.49% 39.78%

7 PBT/ Net sales % 13.30% 13.42% 23.25% 31.14% 36.16% 37.00%

8 Net Profit / Sales 8.38% 8.45% 14.65% 19.62% 22.78% 23.31%

Rupees Millions

Sumaya HMX Systems Ltd.,A 422 Peenya Industrial Estate

Bangalore 560 058

Ph : +91.80.23721065 Fax: +91.80.23722326

vaidy@hmx.biz