REAL CLIENT MANAGED PORTFOLIO

RUI DENG FRANK DAMIAN PO-CHIEH SHIH March 29, 2012

AGENDA

 Introduction  Macroeconomic Review  Relevant Stock Market  Company Review & Business  Financial Analysis  Financial Projections  Recommendations

INTRODUCTION

Source: Capital IQ Benchmark S&P 500

INTRODUCTION – TARGET COMPANY

EnerSys (ENS) is one of largest manufacturer, marketer and distributor of industrial batteries. ENS manufacture, market and distribute related products such as chargers, power equipment and battery accessories. In addition, ENS provides related after-market and customer support services for industrial batteries. ENS’s products sell globally to over 10,000 customers in more than 100 countries.

Source: ENS 2011 Annual Report, Form 10-K, p. 5

INTRODUCTION – TARGET COMPANY

 Position in GICS Map 201040 Electrical Equipment 20104010 Electrical Components & Equipment Companies that produce electric cables and wires, electrical components or equipment not classified in the Heavy Electrical Equipment Sub-Industry.

INTRODUCTION – TARGET COMPANY STOCK PRICE

Source: Morningstar

INTRODUCTION – TARGET’S KEY STATISTICS

Ticker Stock Price Beta: 52wk Range: Market Cap: P/E (ttm): EPS (ttm): Dividend Yield: ENS 35.79

1.79

17.35 - 40.32

1.71B

13.83

2.59

N/A (N/A) 50,044,246 Number of Shares Oustanding: Gross Profit Margin: Operating Income Margin: Net Profit Margin: Return on Assets (ttm): Return on Equity (ttm): 22.90% 9.40% 5.80% 7.01% 13.67% SOURCE: Yahoo Finance

INTRODUCTION – TARGET’S KEY STATISTICS

MACROECONOMICS REVIEW – GLOBAL STATISTICS

MACROECONOMICS REVIEW – US STOCK MARKET

RELEVENT STOCK MARKET INDUSTRY MARKET IN THE U.S.

RELEVENT STOCK MARKET INDUSTRY COSTS STRUCTURE

RELEVENT STOCK MARKET COMPETITORS

The industrial battery market is highly competitive. ENS’s competitors range from development stage companies to large domestic and international corporations. • Europe • Exide Technologies, FIAMM, NorthStar, SAFT, and Hoppecke.

Americas • Exide Technologies, East Penn Manufacturing, C&D Technologies Inc, NorthStar, SAFT and EaglePicher (OM Group).

Asia GS-Yuasa, Shin-Kobe and Zibo Torch, Coslight, Narada, and China Shoto.

Source: ENS 2011 Annual Report, Form 10-K, p. 8

RELEVENT STOCK MARKET ENS MARKET SHARE IN THE U.S.

RELEVENT STOCK MARKET COMPETITORS

RELEVENT STOCK MARKET COMPETITORS

RELEVENT STOCK MARKET COMPETITORS

Competitor Comparisons

Market Cap: Employees: Qtrly Rev Growth (yoy): Revenue (ttm): Gross Margin (ttm): EBITDA (ttm): Operating Margin (ttm): Net Income (ttm): EPS (ttm): P/E (ttm): PEG (5 yr expected): P/S (ttm): Dividend Yield: Return on Assets (ttm): Return on Equity (ttm): ENS 1.71B

8,400 12.90% 2.24B

21.97% 250.08M

9.02% 128.74M

2.59

13.83

1.71

0.75

N/A 7.01% XIDE 252.07M

10,027 -2.00% 3.08B

16.91% 185.88M

3.28% 45.75M

0.55

5.81

0.25

0.08

N/A 3.05% JCI 21.86B

162,000 9.20% 41.71B

15.07% 2.76B

4.79% 1.66B

2.41

13.34

0.62

0.53

2.20% 4.49% 13.67% 11.08% 15.98%

SOURCE: Yahoo Finance

COMPANY REVIEW & BUSINESS HISTORY

• • • • EnerSys and its predecessor companies have been manufacturers of industrial batteries for over 100 years. Morgan Stanley Capital Partners teamed with the management of Yuasa, Inc. in late 2000 to acquire from Yuasa Corporation (Japan) its reserve power and motive power battery businesses in North and South America. On January 1, 2001, the company changed its name from Yuasa, Inc. to EnerSys to reflect our focus on the energy systems nature of our businesses.

In 2004, EnerSys completed an initial public offering (the “IPO”). Source: ENS 2011 Annual Report, Form 10-K, p. 6

COMPANY REVIEW & BUSINESS PRODUCTS & SERVICES

ENS has two primary industrial battery product lines: reserve power products and motive power products. • • • •

Reserve power products

Backup power for the continuous operation of critical applications in telecommunications systems.

Uninterruptible power systems, or “UPS”, applications for computer and computer-controlled systems.

Other specialty power applications • •

Motive power products

Are used to provide power for manufacturing, warehousing and other material handling equipment, primarily electric industrial forklift trucks, mining equipment, and for diesel locomotive starting and other rail equipment.

Source: ENS 2011 Annual Report, Form 10-K, p. 5

COMPANY REVIEW & BUSINES PRODUCTS & SERVICES

ENS’s trademarks:

ArmaSafePlus, Cyclon, DataSafe, Deserthog, Douglas Battery, Douglas Legacy, Energia , FIAMM Motive Power, General Battery, Genesis, Hawker, HUP, Ironclad, LifeGuard, LifePlus, Life Speed, LifeTech, Loadhog, Odyssey, Oerlikon Battery, Oldham, Perfect Plus, PowerGuard, PowerSafe, ProSeries, Redion, Smarthog, Superhog, Supersafe, TeleData, Varta, Waterless, Wi-IQ, Workhog and XFC Flex.

ENS offer high-quality service, including preventative maintenance programs and customer support. The extensive industry experience of ENS’s sales organization results in strong long-term customer relationships.

Source: ENS 2011 Annual Report, Form 10-K, p. 6

Financial Analysis

 Recent News:   Mar 22, 2012 Completed a license and technology development agreement with PowerGenix Systems, Inc. to provide nickel-zinc batteries to EnerSys' industrial battery customers worldwide   Mar 28, 2012 Announced the formation of a new joint venture company in India to produce and market batteries for industrial applications  Expands the addressable markets for its products Source: ENS Investor Relations http://phx.corporate-ir.net/phoenix.zhtml?c=180086&p=irol-newsArticle&ID=1677641&highlight= http://phx.corporate-ir.net/phoenix.zhtml?c=180086&p=irol-newsArticle&ID=1675579&highlight=

Financial Analysis

 Sales (2010-2011) ($million) Europe Americas Asia Total net sales 2010% Net sales 742 700.3

47.0% 44.3% 137.1

1579.4

8.7% 100.0% 2011% Net sales $ Increase % Increase 890.3

896.6

45.3% 45.6% 148.3

196.3

20.0% 28.0% 177.5

1964.4

9.0% 100.0% 40.4

385 29.5%

24.4%

Reserve power Motive power Total net sales 820.5

758.9

1579.4

52.0% 48.0% 100.0% 970.4

994 1964.4

49.4% 50.6% 100.0% 149.9

235.1

385 18.3% 31.0%

24.4%

 Contributions to % Increase Europe Americas Asia Reserve power Motive power Volume 16% Price 19% 25% 6% Acquisition 3% FoEx 4% -2% 5% -5% Total % Increase 20.0% 6% 28.0% 29.5% 16% 21% 2% 6% 2% 6% -2% -2% 18.3% 31.0%

Financial Analysis

 Interest Expense ($million) Avg debt outstanding Avg cash interest rate Interest Accured interest Amortization of deferred financing fees Interest expense 2009 395.8

5.00% 19.8

4.3

1.7

25.8

2010 364.1

4.30% 15.7

5.4

1.7

22.8

2011 326.3

4.40% 14.4

5.9

1.9

22.2

Average 362.1

4.57% 5.2

1.8

 Estimated Interest Expense ($ million) Avg debt outstanding Avg cash interest rate Interest Accured interest Amortization of deferred financing fees Interest expense 2012 362.1

4.57% 16.5

5.2

1.8

23.5

2013 362.1

4.57% 16.5

5.2

1.8

23.5

2014 362.1

4.57% 16.5

5.2

1.8

23.5

2015 362.1

4.57% 16.5

5.2

1.8

23.5

2016 362.1

4.57% 16.5

5.2

1.8

23.5

2017 362.1

4.57% 16.5

5.2

1.8

23.5

2018 362.1

4.57% 16.5

5.2

1.8

23.5

Financial Analysis

 Profitability For the Fiscal Period Ending Profitability Return on Assets % Return on Capital % Return on Equity % Return on Common Equity %  Margin Analysis For the Fiscal Period Ending Margin Analysis Gross Margin % SG&A Margin % EBITDA Margin % EBITA Margin % EBIT Margin % Net Income Margin % 12 months Mar-31 2007 12 months Mar-31 2008 12 months Mar-31 2009 12 months Mar-31 2010 12 months Mar-31 LTM 12 months 2011 Jan-01-2012 4.2% 6.3% 9.1% 9.2% 5.3% 8.0% 9.6% 9.7% 6.1% 9.0% 12.0% 12.0% 5.1% 7.2% 8.5% 8.6% 6.8% 10.0% 12.9% 12.9% 7.0% 10.1% 13.7% 13.8% 12 months Mar-31 2007 12 months Mar-31 2008 12 months Mar-31 2009 12 months Mar-31 2010 12 months Mar-31 LTM 12 months 2011 Jan-01-2012 20.7% 14.7% 9.1% 6.0% 6.0% 3.0% 18.8% 12.3% 8.9% 6.6% 6.5% 2.9% 21.0% 13.0% 10.3% 8.0% 8.0% 4.2% 22.9% 14.8% 10.9% 8.1% 8.1% 3.9% 22.9% 13.2% 12.0% 9.7% 9.7% 5.8% 22.0% 13.0% 11.2% 9.1% 9.0% 5.8%

Financial Analysis

 Outperform the benchmark Source: Bloomberg

Financial Analysis

 Asset Turnover For the Fiscal Period Ending Asset Turnover Total Asset Turnover Accounts Receivable Turnover Inventory Turnover  Short-term Liquidity 12 months Mar-31 2007 12 months Mar-31 2008 12 months Mar-31 2009 12 months Mar-31 2010 12 months LTM Mar-31 12 months 2011 Jan-01-2012 1.1x

4.6x

5.8x

1.3x

4.7x

5.8x

1.2x

4.6x

5.7x

1.0x

4.3x

5.3x

1.1x

4.6x

5.1x

1.2x

5.1x

5.3x

For the Fiscal Period Ending Short Term Liquidity Current Ratio Quick Ratio Cash from Ops. to Current Liability Avg. Days Sales Outstanding Avg. Days Inventory Outstanding Avg. Days Payable Outstanding Avg. Cash Conversion Cycle 12 months Mar-31 2007 12 months Mar-31 2008 12 months Mar-31 2009 12 months Mar-31 2010 12 months Mar-31 LTM 12 months 2011 Jan-01-2012 1.7x

1.0x

0.2x

1.7x

1.0x

0.0x

2.2x

1.5x

0.6x

2.1x

1.4x

0.3x

2.2x

1.3x

0.2x

2.2x

1.2x

0.3x

80.1 63.3 52.3 91.0 77.2 63.4 48.3 92.3 79.5 63.8 49.4 93.8 85.5 69.5 47.1 107.9 78.8 71.0 51.5 98.3 71.1 68.3 46.9 92.4

Financial Analysis

 Solvency For the Fiscal Period Ending Long Term Solvency Total Debt/Equity Total Debt/Capital LT Debt/Equity LT Debt/Capital Total Liabilities/Total Assets  Growth For the Fiscal Period Ending Growth Over Prior Year Gross Profit Net Income Accounts Receivable Inventory Net PP&E Total Assets Tangible Book Value Common Equity Cash from Ops.

Capital Expenditures 12 months Mar-31 2007 12 months Mar-31 2008 12 months Mar-31 2009 12 months Mar-31 2010 12 months LTM Mar-31 12 months 2011 Jan-01-2012 73.8% 42.5% 69.7% 40.1% 61.3% 61.4% 38.0% 53.6% 33.2% 59.4% 57.7% 36.6% 52.9% 33.5% 54.8% 45.9% 31.5% 42.5% 29.1% 52.5% 26.5% 20.9% 26.1% 20.6% 46.5% 28.4% 22.1% 26.0% 20.3% 46.7% 12 months Mar-31 2007 12 months Mar-31 2008 12 months Mar-31 2009 12 months Mar-31 2010 12 months Mar-31 LTM 12 months 2011 Jan-01-2012 12.4% 47.1% 13.9% 30.5% 6.8% 11.5% 170.2% 21.8% 68.9% 6.8% 22.7% 32.0% 43.1% 43.3% 13.0% 21.4% 96.6% 27.6% (94.5%) 6.3% 8.3% 37.2% (29.2%) (37.6%) (11.4%) (12.7%) 14.2% (3.1%) 5,361.3% 26.9% (12.7%) (24.0%) 7.7% 21.5% 4.6% 10.7% 28.9% 16.4% (37.7%) (21.1%) 24.6% 82.1% 21.0% 31.7% 9.3% 10.7% 42.8% 24.9% (44.0%) 32.9% 16.6% 27.3% 8.0% 14.3% 3.8% 3.5% 4.8% 6.6% 112.3% (3.4%)

Comparables – Multiples Valuation

Reality Check

 DuPont Analysis NPM TAT EM ROE  Estimated NPM TAT EM ROE 2012 7.2% 1.24

1.86

16.6% 2008 2.9% 1.30

2.53

9.7% 2009 4.2% 1.23

2.35

12.0% 2010 3.9% 1.00

2.17

8.6% 2011 5.8% 1.13

1.98

12.9% 2013 8.2% 1.28

1.80

19.0% 2014 8.9% 1.29

1.70

19.4% 2015 9.3% 1.27

1.57

18.5% 2016 9.6% 1.25

1.44

17.2% 2017 9.8% 1.20

1.34

15.8% 2018 9.9% 1.16

1.24

14.2%

DCF Model

 CAPM Risk -free rate Beta 2% 1.79

Risk Premium CAPM 6% 12.7%  Historical ROE ROE 31-Mar 2007 9.2%  Cost of Equity 31-Mar 2008 9.7% 31-Mar 2009 12.0% 31-Mar 2010 8.6% 31-Mar LTM 12 m 1-Jan 2011 12.9% 2012 13.8% CAPM ROE Cost of equity 12.74% Weight 80% 13.35% 12.86% 20%  WACC Debt Cost of debt Equity Cost of equity Tax rate WACC 253,400 7.26% 1,679,493 12.86% 28.80% 11.9%  Discount Rate Adjustment Discount rate 1.0%

12.9%

Financial Analysis

 Sensitivity Analysis  Sensitive to discount rate  1% increase in discount rate  Price estimation drops to $33 (13% decrease)  1% decrease in discount rate  Price estimation increases to $45 (17% increase)

Recommendation

• • • Current Price = $34.77

DCF Model = $35.80

Comparables Approach = $36.31 • • • • Uncertainty over its ability to compete with new technologies and companies in Asia Insider Transaction Need to see tangible results from its cost-cutting initiatives and recent acquisitions Still believe in management and business • Recommendation: WATCH LIST