Asian Paints Ltd. · NSE:ASIANPAINT
Asian Paints — The 2005 DSP Merrill Lynch Institutional Investor Conference
36 slides from Asian Paints's conference presentation, Feb 3, 2005
Slide 1: The 2005 DSP Merrill Lynch Institutional Investor Conference
1 The 2005 DSP Merrill Lynch Institutional Investor Conference Taj Krishna, Hyderabad February 3, 2005
Slide 2: The Asian Paints group
2 The Asian Paints group India’s Largest paint company for over three decades with revenues of over Rs 22.64 billion (USD 513 million) Among the top 10 Decorative Coatings Company in the World Operates in 22 countries 27 paint manufacturing facilities across the globe producing 370 million litres of
Slide 3: Presentation structure
3 Presentation structure • Asian Paints Consolidated Results : Q3 – FY 2005 • Asian Paints Consolidated Results : 9M – FY 2005 • Outlook and Risks
Slide 4: Consolidated Profit & Loss Account – Q3 FY2005
4 Asian Paints - Consolidated results Profit & Loss Account – Q3 – FY 2005 (Rs. in Millions) Q3 04-05 Q3 03-04 Gr % Sales & Op. Income 7,537.28 5,854.44 28.74% Other Income 109.02 55.21 97.47% Total Income 7,646.31 5,909.65 29.39% PBDIT 1,135.09 897.68 26.45% Interest 30.27 37.28 -18.81% Depreciatio
Slide 5: Explanation - Asian Paints Consolidated Q3 FY2005
5 Explanation - Asian Paints Consolidated Q3 - FY2005 • Sales & operating income has increased by 28.74% to Rs. 7,537.28 million – APIL - Paints, APICL+Asian PPG, and international business has registered growth of 32.4%, 35.2% and 12.7% respectively • PBDIT has increased by 26.45% to Rs. 1,135 mill
Slide 6: Standalone Profit & Loss Account: Q3 FY2005
6 Asian Paints – Stand alone Profit & Loss Account : Q3 - FY2005 (Rs. in Millions) Q3 04-05 Q3 03-04 Gr % Sales & Op. Income 5,959.52 4,510.72 32.12% Other Income 87.96 35.88 145.18% Total Income 6,047.48 4,546.60 33.01% PBDIT 990.42 781.91 26.67% Interest 7.67 13.07 -41.30% Depreciation 122.09 121.
Slide 7: Presentation structure
7 Presentation structure • Asian Paints Consolidated Results : Q3 – FY 2005 • Asian Paints Consolidated Results : 9M – FY 2005 • Outlook and Risks
Slide 8: Dividend
8 Dividend • For H1 FY05, the company distributed an interim dividend of 40 % (Rs.4.00 /-)per share • For H1 FY04, the company distributed an interim dividend of 35 % (Rs. 3.50 /-)per share. For the financial year 2003- 04, the company distributed total dividend of 85% (Rs. 8.5 /-) per share.The pay
Slide 9: Consolidated Profit & Loss Account – 9M FY2005
9 Asian Paints - Consolidated results Profit & Loss Account – 9M – FY 2005 (Rs. in Millions) 9M 04-05 9M 03-04 Gr % Sales & Op. Income 19,844.01 16,920.73 17.28% Other Income 266.06 146.58 81.51% Total Income 20,110.07 17,067.31 17.83% PBDIT 2,910.41 2,511.60 15.88% Interest 91.35 121.28 -24.68% Dep
Slide 10: Asian Paints Consolidated Sales: Q3 & 9M FY2005
10 Asian Paints Consolidated Sales: Q3 & 9M-FY 2005 9M-FY'05 9M-FY'04 Growth % to tot sales % to tot sales % 9M-FY'05 9M-FY'04 APIL - Paints 14,407 12,377 16.4% 72.6% 73.1% Chemicals 995 836 19.0% 5.0% 4.9% APPG* & APICL 934 735 27.1% 4.7% 4.3% International 3,509 2,973 18.0% 17.7% 17.6% 19,844 16,9
Slide 11: Highlights - Asian Paints consolidated accounts – 9M FY'05
11 Highlights - Asian Paints consolidated accounts – 9M FY’05 • Sales growth and profit growth for the group is higher than standalone results of Asian Paints (India) Limited • Other income has increased by 81.5% due to – Dividend income and gain on disposal of the Malta unit • Overheads for the gro
Slide 12: Components of Asian Paints Consolidated Sales
12 Components of Asian Paints Consolidated Sales • Asian Paints Standalone – APIL Paints – APIL Chemicals • Asian Paints Industrial Coatings Limited(APICL) + Asian PPG Industries • International Business
Slide 13: Standalone Profit & Loss Account: 9M FY2005
13 Asian Paints – Stand alone Profit & Loss Account : 9M - FY2005 (Rs. in Millions) 9M 04-05 9M 03-04 Gr % Sales & Op. Income 15,455.71 13,255.88 16.60% Other Income 224.74 119.63 87.87% Total Income 15,680.45 13,375.51 17.23% PBDIT 2,553.43 2,228.67 14.57% Interest 21.19 42.28 -49.88% Depreciation
Slide 14: Standalone Segment Results: Q3 & 9M FY2005
14 Asian Paints – Stand alone Segment Results : Q3 & 9M - FY 2005
Slide 15: APIL Paints: 9M FY2005
15 APIL Paints : 9M - FY 2005 • Revenue for the paints business has grown by 16.3% – Aided by good growth for decorative paints in all product segments and in all geographies – Industrial coatings viz high performance and road markings segment, which is around 3 % of APIL- Paints sales registered gr
Slide 16: APIL Paints: Decorative BU
16 APIL Paints : Decorative BU • In Decorative products, performance has been good in all regions; especially good in many competitive markets • The Utsav range of economy products is now well established and is doing well • Emulsion growths have been strong – These have been driven by quality enhan
Slide 17: APIL Paints: Decorative BU - raw material prices
17 APIL Paints : Decorative BU (2003 - 04 Base = 100) Prices of Key Raw Materials Item Unit Jun'04 Sep'04 Dec'04 Price Indices Q1-FY05 Q2-FY05 Q3-FY05 TiO2 Rutile Imp USD/MT 1900 1925 1975 Raw Material 100.12 104.42 111.55 Soyabean Oil Rs/Kg 45 47 42 Packing Material 106.15 108.85 113.44 Comm. Casto
Slide 18: APIL Paints: Decorative BU
18 APIL Paints : Decorative BU • Impressive Q3 sales growth due to late Diwali in current year. • APIL-Paints sales growth of 16.3 % for 9M-FY’05 • Raw Material prices rose sharply during Q3. The ratio of material cost to sales was over 300 basis points higher than the corresponding quarter of the p
Slide 19: APIL Chemicals
19 APIL Chemicals • Chemicals business revenue has increased by 20.4 % and PBIT has increased by 119.8 % • PBIT as a percentage to revenue has increased from 6 % to 11 % for 9M - FY’2005 – Due to better price realisations for Phthallic Anhydride • The chemicals business which contributes 5% to overa
Slide 20: Components of Asian Paints Consolidated Sales
20 Components of Asian Paints Consolidated Sales • Asian Paints Standalone – APIL Paints – APIL Chemicals • Asian Paints Industrial Coatings Limited(APICL) + Asian PPG Industries • International Business
Slide 21: APICL & APPG
21 APICL & APPG • Automotive paints and powder coatings business combined have recorded growth of 35.2% for Q3 & 27.1% for 9M - FY’05. • The good growth in the passenger vehicle segment have helped Asian PPG industries record very good top-line growth for 9M FY2005
Slide 22: Components of Asian Paints Consolidated Sales
22 Components of Asian Paints Consolidated Sales • Asian Paints Standalone – APIL Paints – APIL Chemicals • Asian Paints Industrial Coatings Limited(APICL) + Asian PPG Industries • International Business
Slide 23: International BU: 9M-FY2005
23 International BU : 9M-FY2005 • Volume sales for international business has increased by 20% to 48,905 KL • Value Sales for international business has increased by 18 % to Rs. 3,509 million • Due to increase in material cost and also a shift in the regional mix more in favour of Middle East, the m
Slide 24: International Operations Regionwise Sales Breakup
24 International Operations Regionwise Sales Breakup 9M-FY'05 9M - FY'04 Middle Caribbean Caribbean 29.6% Middle East 25.5% 36.5% East 32.3% South South Pacific Pacific 13.3% S Asia S Asia 9.4% 13.2% S E Asia S E Asia 8.8% 15.3% 16.1% • Middle East region, the largest contributor to the revenue of i
Slide 25: International BU: Initiatives
25 International BU : Initiatives • Asian Paints subsidiary Berger International exited operations in Malta – No strategic fit, as it was the only subsidiary in Europe – Contribution to group sales was insignificant – Exit has resulted in gain of Rs. 13 million – Technical service and trademark lice
Slide 26: International BU: Initiatives
26 International BU : Initiatives • Exports/licensing arrangements is a revenue stream being actively pursued by overseas units – Exports to over 40 countries being made by various group subsidiaries. – Technical consultancy agreement signed with Berger Paints Pakistan limited, the 2nd largest paint
Slide 27: International BU: Initiatives
27 International BU : Initiatives • Launch of dealer tinting systems in key markets • New brand architecture being implemented across International markets • Global insurance policies taken to cover key risks – Standardized template put in place to cover other risks • Regional Technology centres ful
Slide 28: Asian Paints Standalone – Balance Sheet 9M-FY2005
28 Asian Paints Standalone – Balance Sheet 9M-FY2005
Slide 29: Asian Paints Standalone – Key Ratios 9M-FY2005
29 Asian Paints Standalone – Key Ratios 9M-FY2005
Slide 30: Asian Paints Standalone - Cash Flow 9M-FY2005
30 Asian Paints Standalone - Cash Flow 9M -FY2005
Slide 31: Indian Paint Market
31 Indian Paint Market Paint Revenue Share FY 2003 Paint Revenue Share FY 2004 Top 6 paint companies Top 6 paint companies 11.1% 0.4% 10.9% 1.5% 17.3% 3.9% 17.5% 3.8% 19.5% 46.8% 20.3% 46.9% Asian Paints Nerolac Berger Asian Paints Nerolac Berger ICI J&N Shalimar ICI J&N Shalimar
Slide 32: Net working capital & ROCE for the last five years
32 Asian Paints - Net working capital & ROCE for the last five years 80 72 60 71 46 39 37.4 40 33.6 36.5 27 20 30.7 27.9 0 FY'00 FY'01 FY'02 FY'03 FY'04 ROCE (%) NWC(in days) ROCE : EBIT/Cap.emp
Slide 33: Presentation structure
33 Presentation structure • Asian Paints Consolidated Results : Q2 – FY 2005 • Asian Paints Consolidated Results : 9M – FY 2005 • Outlook and Risks
Slide 34: Economic Environment - India
34 Economic Environment - India • GDP likely to grow at 6 - 7% due to – Lower agriculture growth – High base • Inflation is likely to remain around 7 % for the remaining months – Cause for concern – Likely to put pressure on interest rates – Crude oil price and other downstream products still remain
Slide 35: Outlook and Risks
35 Outlook and Risks • Outlook on demand for Paints in India – So far, demand has been good – Demand especially good for industrial products due to automobile boom. This is likely to continue for the remaining part of the year – In seasonal decoratives business, due to late Diwali the Q3 growth was
Slide 36: End...
36 End...
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