Gaurav Chakraborty 21 st Feb’09

1. Gaurav Chakraborty 21st Feb’09 Enabling Business to Scale New Heights Benefits of Implementing SAP

2. Agenda • SAP Overview • Solution Coverage • Benefits of Implementing SAP

3. Summary of SAP today SAP AG in 2007 revenues: Rs 72,000 Cr More than 43,000 companies run SAP software Providing more than 25 industry solutions 43,772 SAP employees (December, 2007) 12 million users in 120+ countries team with us to… Integrate their business processes Extend their competitive capabilities Get a better return on investment at a lower total cost of ownership Unique partner ecosystem More than 3,850 partners Overall more than 180,000 SAP partner certificates More than 10% spent in R&D each year

4. SAP in India • Market Leader - 4500+ Customers • Country wide Offices , 7500+ Employees & Growing • SAP Labs – R&D Centre at Bangalore & Delhi • Mature India Localization & India Payroll • Customer Care Centre at Bangalore • Large & Leveragable Skill Base • Knowledge Services

5. SAP in India – Some Interesting Facts SAP Support Office SAP Labs SAP Sales Office No. 1 ERP SAP Sales Office, Calcutta SAP Sales Office SAP Global Delivery Center SAP Labs SAP Sales Office SAP India Headquarters 11 out of 16 “Navratnas” run SAP 9 out of 10 most profitable and largest companies run SAP 24 out of 30 companies in Sensex run SAP 37 out of 50 companies in Nifty run SAP 36 out of 50 in ET 500 run SAP 21 of the top 25 brands in India run SAP 18 of the 20 companies listed in the BCG Global Challengers list run on SAP 25 out of the 40 Largest Indian Companies named by Forbes run SAP 7 out of the 13 Indian firms named by BusinessWeek in 'Asia's Hot Growth Companies' list run SAP

6. Auto CPG Oil & Gas E&C IT Service Telecom Solid Penetration … Hallmark of the Leader

7. Agenda • SAP Overview • Solution Coverage • Benefits of Implementing SAP

8. Financial Management General Ledger Analytics Legal Consolidation Parallel Accounting Accounts Receivables Billing Accounts Payable Expense Management Asset Accounting Check Printing Budgeting Payroll Overhead Cost Controlling Funds Management Activity Based Costing Treasury Profitability Analysis Cash Management • Streamlines information control, analysis, and delivery • Enables performance planning, measurement, and management • Optimizes the financial supply chain • Most comprehensive, functionally-rich solution on the market • Market-leading solutions and customers in all industries • Reliable, proven business partner with solution and industry expertise

9. Initiation Planning & Approval Project Execution Closing Project Management Project Initiation Project Reuse Project Team Project Archiving Project Estimation & Budgeting Project Status Management Project Planning & Scheduling Project Base lining & Simulation Capacity Management Multi -Project Management Project Procurement Project Progress Tracking Project Production Project Claims Project Costing Project Confirmations Project – EH&S Project Document Distribution • Flexible Search/E-PublishingProject documents can be searched by various search engines and can also be published for external access on the Internet. • Life-Cycle Data ManagementFull integration into the Document Management System of mySAP Life-Cycle Data Management; assignment of all various documents supported by all DMS functions (i.e. versioning, vaulting) • Integrated Viewing / MaintenanceAll originals of assigned document masters can be viewed/maintained directly from the project’s maintenance environment.

10. Initiation Planning & Approval Project Execution Closing Procurement and Material Management Purchase Requisition Knowledge Management RFQ & Purchase Orders Supplier Payments Tendering Supplier Collaboration Supplier Evaluation & Blacklisting Contract Management Delivery Schedules Quality Inspection Physical Inventory Audits Approvals & Workflows Shelf Live & Status Service Masters Goods Movements Warehouse Management Workflows • MonitorMonitor progress & payments as per schedule. • ExecuteCheck deleverables of the supplier & sub contractor based on contracts & confirm using service entry sheets • DefineDefine the project requirements. Select Source & complete detailing

11. mySAP HR – A Total, Integrated HCM Solution • Workforce Planning • Workforce Cost & Headcount Planning & Simulation • Employee Succession Planning • Balanced Scorecard • Lifecycle Management • Career Planning • Recruiting and Talent Management • Shift Planning • Performance Management • Compensation Management • Learning • Training & Events Management • Skills/Qualification Management • Transaction Management • Organizational Management • Personnel Administration • Payroll • Claims , Loans • Time Management • Reporting • Global Employee Management • Relationship Management • Expert Finder • Manager Self-Service • Employee Self-Service • Employee Interaction Center • Collaboration Tools • Workforce Analytics • 91 pre-defined Key Performance Indicators • SAP Business Warehouse Integration

12. Internal / External resource- planning • Release / Print • Control / Execution • Time- / Material confirmation • Technical completion • Order settlement • Techn. Object • Condition description • Item data • Activities / Tasks • Priorities • Objects • Orders / Notifications • Costs • Downtimes PM Order Notification History Completion Maintenance Management Work Force Management Equipment History Location & Asset Mapping GPS Interface Maintenance Planning & Scheduling Early Warning System Budgeting & Sanctions Meter Reading & Counter Based Tools & Documents Mobile Device Complaint Management Valuation & Status Management Warranty & AMC Preventive / Predictive / Breakdown / Shutdown Maintenance Contracts & Subcontracting Work Clearance Spares Management

13. E-Procurement Solution for 2 Envelope Bid 1 Publish Requirements in portal 3 2 Consolidate Requirement for project EBP Tender fee payment by Contractor ERP Contractor – Download tender 4 Payment Gateway 5 6 Contractor - Upload Bid Supporting documents 7 (Secure Network) Bid Opening and Comparison Reverse Auction Enhanced Supply base 8 Tender award 9 Reduced Spend

14. INDIAN REGULATORY COMPLIANCE Country Chart Of Accounts Analytics Schedule VI Parallel Accounting Balance Sheet Sales Tax – Octroi / Entry Tax EWT - TDS Aging Analysis Provisional Tax Excise Bonds / LOU Vendor Certifications CVD Annual Returns – Section 194A/C/D…etc Subcontractor Challans Income Tax Depreciation Excise Invoice Capture & Post Excise Duty – BED , AED , SED CENVAT

15. Drag & Drop Drag & Drop Security User Authentication Transaction History Role / Group / Job / Position Access Control Mass Change Transaction Access Digital Signature Process Access Field Access Multiple Access Locking Firewall Protection Time-Out Encryption Access Effectivity Administration Master Data Security Portal Security • Troubleshooting Authorizations • Transport of Security Related Objects • Integration with Organizational Management

16. Proven Implementation Methodology

17. Agenda • SAP Overview • Solution Coverage • Benefits of Implementing SAP

18. Typical Challenges across key business process in Industry Illustrative KPIs Area of Business Emerging IT Needs Project Management Project Planning, Scheduling & Execution • Variance /earned value analysis of time and cost • Resources expended per month in Rs. In Cr. Enterprise Asset Management • Plant load factor • Auxiliary power consumption • Station heat rate • Highest uninterrupted running days Integrated Asset and Maintenance Management Improved Visibility and Analytics Finance & Reporting • Operating Margin (%) • O&M cost per unit of generation (paisa/unit) • Return on capital employed Business Systems & Applications Consolidation Sourcing & Procurement • Coal inventory turnover = Annual coal consumption/Average coal inventory • Out of stock Index = No. of times out of stock/ No. of times requisitioned • Planning efficiency index = No. of rush orders placed/ Total no. of orders • Spare parts index = Avg value of spare parts inventory/ Avg Value of total inventory • Obsolescence index = Value of non-moving items/Total inventory value Monitoring of human capacity building initiatives Human Resource Mgmt. • Man-MW Ratio • Generation (‘000 MU’s) per employees • Turnover (Rs. Lakhs) per employee • Employee Cost per unit of generation • Training days per employee

19. SAP can drive business value across Fuctions Solution Enablers Area of Business Key SAP Solutions Project Management SAP ERP • Project Systems • Materials Management • Quality Management • Document Management • Unifies project management, time tracking, financial data, and employee skills information in a portfolio management tool • Allows users to create project teams based on skills and availability, monitor progress on a project, track time, analyze results, and much more • Integrated project controls for management of distributed projects SAP ERP • Plant Maintenance • Materials Management • Quality Management • Financials and Controls • Business Intelligence Enterprise Asset Management • Standardizing on SAP will help free work management from tedious and manual data entry, improving productivity among workforce • Improved equipment and asset utilization • Improved scheduling capabilities and resource utilization • Decreased approval time through the use of automated workflow Finance & Reporting SAP ERP • Financials and Controls • Business Intelligence • Increase efficiency of reporting, consolidation and analytics • Automate transactional finance activities which will greatly enhance decision support capabilities • Highlight the variance between actual and forecasted performance, allowing drill-down capabilities to better understand potential issues and opportunities Sourcing & Procurement SAP ERP • Materials Management • Quality Management • Greater visibility into forecast requirements and supplier capabilities will help enhance the effectiveness of materials management • XXX will be able to manage its supply chain more effectively with better planning and forecasting Human Resource Mgmt. SAP Human Capital Mgmt. • Succession Planning • Talent Mgmt. • Compensation Mgmt. • Employee Self Service • Utilizes resources more efficiently to fit organizational needs and lets users assign workers to appropriate jobs, projects and teams • Enable self service to provide timely access to information • Provide a single place to access all standard HR transactions

20. Business Benefits Area of Business Immediate Benefits • 45% reduction in books closure cycle time (from 16 to 11 days) • Seamless reconciliation improved accounting efficiency • Access up-to-date cost records • System-enforced consistency in adherence to policies/ std. procedures across all locations • Management dashboard with complete overview of business in a single screen powered by SAP BI Finance & Reporting Project Management • Real-time tracking of key project activities and milestones • Reduction in project coordination effort • Better project execution visibility helps identify and eliminate potential bottlenecks Human Resource Mgmt. • Enabling employees to manage/ track transactions in self-service mode has significant productivity benefits • Centralized payroll management has enhanced HR productivity - 9 FTE’s can now handle payroll against 40 – 50 earlier

21. Business Benefits Area of Business Immediate Benefits Enterprise Asset Management • 50% rationalization of asset item codes • Complete visibility into asset maintenance history and spare parts movement • Monitor overhauling and OPI (schedules, costs, material availability, sequence of activities etc.) by leveraging SAP capabilities extensively • Spares purchased cost reduction achieved through visibility of common spares across plants and centralized PO process • Lower procurement lead times • Improved vendor collaboration enabled by streamlined workflows and standard processes • 40% rationalization of vendor base through code unification • Consolidation of spend value by supplier help gain savings through “Preferred” vendor discounts • SAP Fuel Management application helped optimize spend by tracking procurement, transportation and consumption trends accurately Sourcing & Procurement Billings and Settlement • Real-time visibility into cash-flows • Uniform bills created for customers drawing power from various divisions/ locations through centralization of commercial billing function • Eliminated errors and revenue loss by standardizing plant level interpretation of billing clauses and terms

22. Typical Improvement Ranges for Power Generation Utilities Conservative Scenario Business Function Likely Scenario Enterprise Asset Management Finance, Accounting and Reporting Reduced Auxiliary Consumption due to Improved Maintenance Practices 5% Shortened Annual Close Process for Filling ARR with DERC 10% 7% 12% Improved Asset Management and Maintenance Efficiency 10% Improved Finance Department Productivity 20% 12% 25% Increased revenues through improvement in scheduled up-time and reduction in unplanned downtimes 2% Integrated reporting/ analytics productivity improvements 10% 3% 12% Reduced Maintenance and Spare Parts Inventory Levels through better visibility 10% Human Capital Management 15% Improved planning and execution of employee redeployment program 20% Sourcing and Procurement 25% Material and Services Rationalization, Standardization, and Consolidation 15% HR Process Development Benefits 25% 20% 35% Better Supplier Contract Negotiation due to Better Contract Handling Efficiency 10% Improved Resource Utilization 20% 15% 35% Reduced Procurement Spend on In-direct Materials (equipment and spares) 5% 10%

23. Key benefit statements made by BPCL . . . BPCL’s – Success with SAP Implementation

24. Kochi Refineries – Success with SAP Implementation

25. A large Gas Public Sector Co. – Success with SAP Implementation

26. TISCO’s experience with SAP. . . 13:20 – 18:07

27. Q & A Thank you for your interest!