Grasim Industries Ltd. · NSE:GRASIM
Grasim Industries — Q2 FY2019 Earnings Presentation
35 slides from Grasim Industries's earnings presentation, Nov 14, 2018
Slide 1: India's New Growth Story: Q2 FY19 Performance Review
Grasim Industries Limited India’s New Growth Story Ranked #59th Best Employer Globally By “Forbes” U.S.A Q2 FY19 Performance Review 14th November, 2018
Slide 2: Our Leadership Businesses
Our Leadership Businesses # 1 Producer in India Pulp & Viscose Staple Fibre Caustic Soda Specialty Chemicals* (Epoxy resins, SBP, CP and others) UltraTech Aditya Birla Fibre^ JVs Cement Capital # 4 Global DG pulp producer # 1 Cement Producer in India Amongst Top 3 Asset Management companies ^ VSF op
Slide 3: Contents
CONTENTS Content Performance Financial Business Highlights Performance Performance Glossary ABCL: Aditya Birla Capital Ltd., ABNL: Aditya Birla Nuvo Ltd., FCF: Free Cash Flow, NBFC: Non Banking Finance Company, VSF: Viscose Staple Fiber, VFY: Viscose Filament Yarn, MT : Metric Ton, K: One Thousand,
Slide 4: Performance Highlights – Q2FY19
Performance Highlights – Q2FY19 Net Revenue (Rs. Cr.) EBITDA (Rs. Cr.) PBT (Rs. Cr.) Standalone ` 5,118Cr. ` 1,352Cr. ` 1,113 Cr. Up by 26% YoY Up by 28% YoY Up by 32% YoY Consolidated ` 16,795 Cr. ` 2,854 Cr. ` 1,636 Cr. Up by 24% YoY Up by 1% YoY Up by 3% YoY ► Reported best ever Standalone Revenu
Slide 5: Quarterly Business Performance
Quarterly Business Performance Standalone Net Revenue (Rs. Cr) 5,118 4,789 4,606 4,384 4,059 Q2FY18 Q3FY18 Q4FY18 Q1FY19 Q2FY19 Standalone EBITDA (Rs. Cr) 1,352 1,176 195* 1,054 920 947 186* 1,157 868 Q2FY18 Q3FY18 Q4FY18 Q1FY19 Q2FY19 * Dividend Income Grasim Presentation – Q2FY19 5
Slide 6: Content
Content Performance Financial Business Highlights Performance Performance Grasim Presentation – Q2FY19 6
Slide 7: Income Statement Q2 FY19
Income Statement Q2 FY19 Standalone % Consolidated % Particulars (Rs. Cr.) Q2FY19 Q2FY18 Change Q2FY19 Q2FY18 Change Net Revenue from Operations 5,118 4,059 26 16,795 13,570 24 Other Income 282 263 7 301 290 4 EBITDA 1,352 1,054 28 2,854 2,817 1 EBITDA Margin (%) 25% 24% 17% 20% Finance Cost 52 43 4
Slide 8: Standalone PAT Bridge Q2FY19
Standalone PAT Bridge Q2FY19 • Post merger of Vodafone India Ltd with Idea Cellular Ltd., the merged entity Vodafone Idea Ltd. ceased to be an ‘Associate’ of the company w.e.f. 31st August 2018. Hence share in PAT of Vodafone idea Ltd has not been consolidated w.e.f. 31st August 2018. • Exceptional
Slide 9: Consolidated PAT Bridge Q2FY19
Consolidated PAT Bridge Q2FY19 • Post merger of Vodafone India Ltd with Idea Cellular Ltd., the merged entity Vodafone Idea Ltd. ceased to be an ‘Associate’ of the company w.e.f. 31st August 2018. Hence share in PAT of Vodafone idea Ltd has not been consolidated w.e.f. 31st August 2018. • Exceptiona
Slide 10: Standalone EBITDA Bridge Q2FY19 - YoY
Standalone EBITDA Bridge Q2FY19 - YoY (Rs. Cr.) 171 20 108 1,352 1,054 Q2 VSF Chemicals Others Q2 FY 2017-18 FY 2018-19 Grasim Presentation – Q2FY19 10
Slide 11: Income Statement H1 FY19
Income Statement H1 FY19 Standalone % Consolidated % Particulars (Rs. Cr.) H1FY19 H1FY18 Change H1FY19 H1FY18 Change Net Revenue from Operations 9,908 6,799 46 33,416 23,253 44 Other Income 404 329 23 644 594 8 EBITDA 2,528 1,675 51 6,066 5,236 16 EBITDA Margin (%) 25% 23% 18% 22% Finance Cost 111 5
Slide 12: Strong Balance Sheet and Financial Ratios
Strong Balance Sheet and Financial Ratios Consolidated Financial Ratios Consolidated Debt / Surplus ( Rs. Cr.) 31st Mar 30th Sept 22,402 22,495 2018 2018 13,575 14,194 Net Worth (Rs. in Cr.) 57,362 55,939* 8,828 8,300 Debt: Equity 0.27 0.27 Mar-18 Sep-18 Standalone Debt / Surplus ( Rs. Cr.) Net Debt
Slide 13: Capex Plan
Capex Plan Capex Cash Outflow Capex spent (Net of CWIP Particulars (Rs. Cr.) FY20 as on FY19 YTD Sep'18 1/4/2018) Onwards VSF: Brownfield Expansion (including debottlenecking) 4,257 Normal Capex (Water supply augmentation & usage 780 reduction, R&D, Environment and Others) Chemical: Brownfield Expan
Slide 14: Content
Content Performance Financial Business Highlights Performance Performance Grasim Presentation – Q2FY19 14
Slide 15: Viscose Industry
Viscose Industry Global Prices Trend ($/Kg) Grey VSF 14,672 14,842 1.0% (RMB Q1FY19 Q2FY19 QoQ per ton) Cotton 2.09 2.07 (USD 1.0% per Kg) Q1FY19 Q2FY19 QoQ Industry Data PSF 1.20 1.30 8.0% (USD per Kg) Q1FY19 Q2FY19 QoQ Monthly average prices ► VSF prices were range bound during the quarter ► Cotto
Slide 16: Viscose business at a glance – Q2FY19
Viscose business at a glance – Q2FY19 ► Higher volumes led by debottlenecking of capacity Volume ► The share of domestic sales volume in the overall sales volume improved to 84% (Q2FY19) from 70% (Q2FY18) Vibrant Domestic ► The demand for VAP products continues to remain buoyant Demand ► Prices rema
Slide 17: Business Performance: Viscose
Business Performance: Viscose Sales volume (KT)* Net Revenue EBITDA 4% 23% 23% 576 136 2,606 130 468 2,120 Q2FY18 Q2FY19 Q2FY18 Q2FY19 Q2FY18 Q2FY19 ► Q2FY19 quarterly performance was best ever with record production of 137KT and highest ever domestic sales of 114KT (92KT Q2FY18) ► EBITDA up by 23%
Slide 18: Reaching new Heights through LIVA
Reaching new Heights through LIVA The Brand Equity score of LIVA improved to 1.5 in SS18 compared to 1.1 AW17 LIVA tagged garments for SS18 doubled from SS17 26 Available in 12.6 33+ Brands covered, more than 3000+ stores across the 7 amongst Country 1.8 top brands SS15 SS16 SS17 SS18 LIVA Tagging (
Slide 19: Chemicals Industry
Chemicals Industry North America Europe Asia Operating level Demand Company Research ► Globally caustic prices marginally weakened on a sequential basis on back of few capacity restarts in China and Europe ► Caustic soda demand in India is expected to remain stable while the prices to remain range b
Slide 20: Chemical business at a glance – Q2FY19
Chemical business at a glance – Q2FY19 Volume ► Caustic demand growing at ~5%-6% CAGR ► Strong focus on growing the chlorine VAPs – Revenue up by 34% YoY Healthy Demand growth in Caustic and Chlorine VAP’s ► Chlorine VAP production up by 7% YoY Costs Up by Up by Power 17% Salt 14% Rise in Key input
Slide 21: Business Performance: Chemicals
Business Performance: Chemicals Sales volume* (KT) Net Revenues# EBITDA# 17% 38% 60% 456 258 1,612 285 1,168 220 Q2FY18 Q2FY19 Q2FY18 Q2FY19 Q2FY18 Q2FY19 Grasim Chlorine Price Movement ► Caustic Soda reported second successive quarter of 400 double digit jump of 17% YoY in production and sales 0 vo
Slide 22: Business Performance: Pulp JVs
Business Performance: Pulp JVs Pulp prices ($/Mt) Net Revenues (Rs. In Cr.) 1,040 1,020 Q2FY19 1,304 1,000 980 960 Q2FY18 1,176 Up by 11% 940 YoY 920 900 EBITDA (Rs. In Cr.) 880 860 Down by April May June July Aug Sept Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep 17 17 17 17 17 17 17 17 17 18 18
Slide 23: Business Performance: UltraTech
Business Performance: UltraTech Sales volume (MT) Net Revenue (Rs. Cr.) EBITDA (Rs. Cr.) 20% 18% 16 8,151 1,550 1,446 6,791 14 Q2FY18 Q2FY19 Q2FY18 Q2FY19 Q2FY18 Q2FY19 ► Industry demand growth at 10-11% in Q2FY19. Average cement prices up by 1% QoQ , up 3% North, Central and South, up 1% in East an
Slide 24: Business Performance: ABCL
Business Performance: ABCL Lending Book(Rs. Cr.)* AUM(Rs. Cr.) 30% 11% 2,71,556 57,945 44,675 2,44,609 Q2FY18 Q2FY19 Q2FY18 Q2FY19 ► Revenue and Net profit after minority interest for Q2FY19 are at Rs.3,590 Cr. and Rs.195 Cr ► Lending book (Incl. housing) grew 30% YoY to Rs.57,945 Cr., backed by wel
Slide 25: Business Performance- Other Businesses
Business Performance- Other Businesses Net Revenue (Rs. Cr.) EBITDA (Rs. Cr.) 75 743 69 Fertilizers 561 Improvement in production level on sequential basis Q2FY18 Q2FY19 Q2FY18 Q2FY19 327 13 14 298 Textile Rishra plant resumed operations in Aug’18 (post labour stake) Q2FY18 Q2FY19 Q2FY18 Q2FY19 9 11
Slide 26: Thank You
THANK YOU Grasim Presentation – Q2FY19 26
Slide 27: Consolidated Financial Performance
Consolidated Financial Performance Quarter 2 % Half Year % Particulars (Rs. Cr.) 2018-19 2017-18 Change 2018-19 2017-18 Change Net Sales & Op. Income 16,795 13,570 24 33,416 23,253 44 Other Income 301 290 4 644 594 8 EBITDA 2,854 2,817 1 6,066 5,236 16 Finance Cost 413 430 819 579 Finance Cost Relat
Slide 28: Standalone Financial Performance
Standalone Financial Performance Quarter 2 Half Year Particulars (Rs. Cr.) % % 2018-19 2017-18 2018-19 2017-18 Change Change Net Sales & Op. Income 5,118 4,059 26 9,908 6,799 46 Other Income 282 263 7 404 329 23 EBITDA 1,352 1,054 28 2,528 1,675 51 Finance Cost 52 43 111 50 Depreciation 187 166 370
Slide 29: Balance Sheet
Balance Sheet Standalone (Rs. Cr.) Consolidated (Rs. Cr.) 30th Sept'18 31st Mar'18 EQUITY & LIABILITIES 30th Sept'18 31st Mar'18 43,062 44,790 Net Worth 55,939 57,362 - - Non Controlling Interest 26,715 26,337 - - Borrowings related to financial services 50,937 44,667 2,365 2,969 Other Borrowings 22
Slide 30: Viscose Business Summary
Viscose Business Summary Quarter 2 % Half Year % Particulars 2018-19 2017-18 Change 2018-19 2017-18 Change Capacity VSF KTPA 546 498 10 546 498 10 VFY KTPA 46 - 46 - Production VSF KT 137 130 5 271 260 4 VFY KT 12 5 23 5 Sales Volume VSF KT 136 130 4 268 251 7 VFY KT 12 5 23 5 Net Revenue Rs. Cr. 2,
Slide 31: Chemical Business Summary
Chemical Business Summary Quarter 2 % Half Year % Particulars 2018-19 2017-18 Change 2018-19 2017-18 Change Capacity* KTPA 1,140 840 36 1,140 840 36 Production* KT 254 217 17 490 417 17 Sales Volume* KT 258 220 17 493 418 18 Net Revenue Rs. Cr. 1,612 1,168 38 3,190 2,252 42 EBITDA Rs. Cr. 456 285 60
Slide 32: Cement Business Summary
Cement Business Summary Quarter 2 % Half Year % Particulars 2018-19 2017-18 Change 2018-19 2017-18 Change Capacity* Mn. TPA 93 89 4 93 89 4 Production Mn. MT 16 13 17 17 14 27 Sales Volume Mn. MT 16 14 18 18 14 29 Net Revenue Rs. Cr. 8,151 6,791 20 16,912 13,663 24 EBITDA Rs. Cr. 1,446 1,550 -7 3,21
Slide 33: Grasim: Group Structure
Grasim: Group Structure VSF - 546K TPA Caustic Soda - UTCL (60.21%)* ABCL (55.99)* Overseas VFY - 46K TPA ~1140K TPA Others Subsidiary Pulp & VSF JVs Subsidiary Pulp - 70K TPA Epoxy – 94K TPA Domestic NBFC Broking Nagda Nagda Fertilizers AV Group NB (100%)* (75%)* 155K TPA 270K TPA Inc. Grey Cement
Slide 34: Forward Looking & Cautionary Statement
Forward Looking & Cautionary Statement Certain statements in this report may be “forward looking statements” within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expressed or implied. Important factors that could make a difference to the
Slide 35: Grasim Industries Limited Quarterly Performance Review
Grasim Industries Limited Quarterly Performance Review Q2 FY19, 14th November 2018 Grasim Presentation – Q2FY19 35