Grasim Industries Ltd. · NSE:GRASIM

Grasim Industries — Investor Presentation (February 2016)

44 slides from Grasim Industries's investor presentation, February 2016

  1. Slide 1: Grasim Industries Limited: A VSF and Cement Major

    Grasim Industries Limited A VSF and Cement Major February 2016

  2. Slide 2: Cautionary Statement

    Cautionary Statement Statements in this ‘Presentation’ describing the Company’s objectives, estimates, expectations or predictions may be ‘forward looking statements’ within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expressed or impl

  3. Slide 3: Presentation Structure

    Presentation Structure Introduction Our Businesses Financial Highlights Capex 3

  4. Slide 4: The Aditya Birla Group

    The Aditya Birla Group  Amongst the top business houses in India  Operations spread over 36 countries  Revenue at $ 41 Bn., over 50% from overseas operations  Anchored by 120,000 employees, belonging to 42 nationalities  Ranked 1st in India by Nielson Corporate Image Monitor consecutively for 3

  5. Slide 5: The Aditya Birla Group: Leadership Across Businesses

    The Aditya Birla Group : Leadership Across Businesses Leading Global Player – Hindalco – Novelis is the largest aluminum rolling company – Largest producer of carbon black – Second largest producers of Viscose Staple Fiber (VSF) – Fourth largest producer of insulators and acrylic fibre Leadership po

  6. Slide 6: Grasim: Market leader across Business Segments

    Grasim: Market leader across Business Segments Viscose Staple Leading Global Player Fibre – Capacity : 498K TPA Revenue ` 73 Bn. – Grasim commands 9% global share; ABG share 17% (US$ 1.1 Bn.) – Integrated model with experience of more than six decades Largest Chlor-Alkali Manufacturer in India Chemi

  7. Slide 7: Investment in Growth

    Investment in Growth Substantial Investment made across Businesses – US$ 4 Bn. over last five years..... VSF KTPA* Caustic KTPA* Cement Mn. TPA* Gross Fixed Asset 45% Rs. Bn. 50% 210% 105% 74.8# 468.0 498 804 69.3 334 51.8 228.0 258 FY 11 FY 16 FY 11 FY 16 FY 11 FY16 Mar' 11 Dec' 15 Leading Global P

  8. Slide 8: Consolidated Business Mix – 9M FY16

    Consolidated Business Mix – 9M FY16 Net Revenue - ` 266 Bn. EBITDA - ` 50 Bn. PAT - ` 16.6 Bn. 0.3 0.7 12.1 24.8 1.2 5.2 Others VSF & 7.5 Chemical 42.9 Cement 6.0 9.4 186.3 36.3 8

  9. Slide 9: Presentation Structure

    Presentation Structure Introduction Our Businesses Financial Highlights Capex 9

  10. Slide 10: Viscose Staple Fibre (VSF)

    Viscose Staple Fibre (VSF) Birla Viscose Birla Modal Birla Excel

  11. Slide 11: VSF Global Industry Scenario

    VSF Global Industry Scenario Global Fibre Pie (92 Mn. MT)  VSF: A cellulosic fibre Others VSF  5% of global fibre market 1% 5% Cotton  7% of global man-made fibre market 26% Wool  Major Global Players’ Capacity ‘000 TPA 1% Synthetic 67%  ABG group (incl. Grasim) : 935  of which Grasim : 498 

  12. Slide 12: VSF: Fastest Growing Fibre

    VSF : Fastest Growing Fibre (Mn. Ton) VSF Polyester Staple Fibre Cotton 5.5 CAGR 26.2 25.3 -1% 24.4 4.8 24.5 22.2 3.5 21.9 17.0 15.5 2.7 12.6 8.6 2009-10 2014-15 Production Consumption 2009 2014 2009 2014 Season End Stock Capacity Demand  VSF fastest growing among competing fibres – Preference for

  13. Slide 13: VSF: Global Presence

    VSF: Global Presence Sweden • Domsjo pulp plant China,Hubei Canada JV • VSF JV • 3 Pulp plants JVs India • 4 VSF plants South East Asia • 1 Pulp plant • 2 VSF plants of AVB • 2 Caustic soda Group Cos. plants VSF Plant - Own VSF Plant - JV VSF Plant - Group Cos. Pulp Plant - Own Pulp Plant - JV 13

  14. Slide 14: VSF: Sustainable Competitive Strengths

    VSF : Sustainable Competitive Strengths  Amongst the low cost producers globally  Highly integrated operations  Captive raw materials - Pulp & Caustic Soda  Five pulp manufacturing plants – India : 1, Overseas JVs : 4 (Canada : 3, Sweden : 1)  Captive power and steam  Self managed water supply

  15. Slide 15: LIVA: Greater Connect with Consumers

    LIVA : Greater Connect with Consumers A Co-branded partner uses a “liva tag” on each garment 15

  16. Slide 16: VSF: 9M FY16 Performance

    VSF: 9M FY16 Performance 9M Global Industry Scenario (` Bn.) 2013-14 2014-15 2015-16  Global prices witnessed uptrend in first half, softened recently Capacity (‘000 Ton)* 375 434 374 Sales Volume (‘000 MT) 367 403 337 Business performance  Robust volume growth - up by 19% YoY Net Revenue 47.1 49.

  17. Slide 17: VSF: Outlook

    VSF: Outlook  Textile consumption in India expected to grow at higher rates, $/ Kg vis-à-vis global consumption 2.3 2.1  Will support VSF demand growth 1.9 1.78 1.7  Prices likely to be influenced by 1.5 1.55 1.3  Developments in China and down stream industry 1.1 0.86 0.9  Competing fiber pric

  18. Slide 18: Chemical

    Chemical Largest Chlor - Alkali manufacturer in India Largest producer of Epoxy Resins in India Largest value-added product portfolio including water treatment chemicals 18

  19. Slide 19: Chemical Business: On a strong growth path

    Chemical Business : On a strong growth path….. Market share more than doubled – Merger of ABCIL & Vilayat Greenfield Capacity 22% 13% 10% 11% FY12 FY14 FY15 FY16E * Source : AMAI and Company data Volume (‘000 Tons) EBITDA (` Cr.) 690 745 287 310 380 458 292 314 409 225 266 161 FY12 FY14 FY15 FY16E *

  20. Slide 20: Chemical Business: Footprints

    Chemical Business : Footprints Renukoot Nagda Rehla Vilayat Geographical diversification Ganjam with ABCIL merger Grasim plants ABCIL Plants Karwar Map not to scale 20

  21. Slide 21: Chemical Business: 9M FY16 Performance

    Chemical Business : 9M FY16 Performance 9M# Business Performance (` Bn.) 2013-14 2014-15 2015-16  Revenue doubled YoY (LFL increase 20%) Capacity (000’ Ton)* 352 452 559  Caustic volume up 84%  Merger of ABCIL Sales Volume Caustic Soda 314 409 558  Vilayat Caustic plant achieved 100% capacity (‘

  22. Slide 22: Cement

    Cement ``q India’s Largest Selling Cement Brand Different Products to provide No. 1 RMC player in India complete Building Solutions No.1 Player of White Cement With > 100 plants > 1100 stores & Cement based Putty

  23. Slide 23: Indian Cement Industry: Overview

    Indian Cement Industry : Overview  Second largest cement market in world  Cement Capacity ~ 404 Mn. TPA  2nd fastest growing cement market globally : CAGR 8% (last decade)  Long term average growth has been 1.2 x of GDP  Industry capacity doubled in last decade  Around 70 million tons capacity

  24. Slide 24: Global Cement Capacity and Per Capita Consumption

    Global Cement Capacity and Per Capita Consumption Top Cement Producing Countries - 2014 Per Capita Consumption - 2014 Kgs/person Mn. Tons 2,438 1,780 830 580 470 355 280 255 200 81 71 72 68 USA World Turkey China Brazil India Russia USA China Turkey India Brazil Russia ______________________________

  25. Slide 25: Cement – Major Growth Drivers in India

    Cement – Major Growth Drivers in India  Favorable demographics with growing young population  Rising affordability - Increasing income level Housing  Government vision of house for every family by 2022  Rapid Urbanisation (28.7% in 2005, likely to exceed 40% by 2030)  No. of Cities with populat

  26. Slide 26: Cement Sector Outlook

    Cement Sector Outlook % Growth  Capacity addition pace slowing down….. Leading 14 12.1 towards improvement in utilisation 12 10  Setting up new Cement capacity becoming more 8.5 8 7.1 challenging due to 5.7 5.2 6  Tougher land acquisition process 3.5 4 2.6  Increased gestation period 2  Availab

  27. Slide 27: Cement Business: Key Strengths

    Cement Business : Key Strengths  Excellent growth record Capacity (Mn. Tons) 67.7  From 8 Mn. TPA in 2001 to ~75 Mn. TPA by 2016 63.2  Grew organically as well as inorganically 51.8  Market Leadership 35.0 29.7  “UltraTech” – Premium national brand 14.2  Leadership in key consuming markets 8.2

  28. Slide 28: Cement Business Footprint – A Pan India Player

    Cement Business Footprint – A Pan India Player Current Mix 2016 * Mix North 19.6 28% 24.6 34% East 9.8 13% 11.4 16% Bhatinda Panipat West 19.8 33% 19.8 28% Jhajjar Dadri Kotputli Aligarh South 15.5 26% 15.5 22% Jodhpur P All India 64.7 100% 71.2 100% Shambhupura Sewagram Patliputra Wanakbori Jawad K

  29. Slide 29: Cement Business: 9M FY16 Performance

    Cement Business : 9M FY16 Performance Industry Scenario 9M (` Bn.) 2013-14 2014-15  Sign of improvement in demand, growth 2015-16 estimated at ~4.5% in Q3FY16  Benefits on cost front with softening of energy Capacity (Mn. Ton) 57.0 63.2 48.5 prices Sales Volume Cement and Clinker Business Performa

  30. Slide 30: Presentation Structure

    Presentation Structure Introduction Our Businesses Financial Highlights Capex Summary 30

  31. Slide 31: Financial Performance

    Financial Performance Standalone Amount in ` bn. Revenue EBITDA Net Profit 40% 64% 49% 13.7 7.5 64.4 50% 46.0 8.3 5.0 128% 178% 23.4 4.8 2.6 15.6 2.1 0.9 Q3FY15 Q3FY16 9MFY15 9MFY16 Q3FY15 Q3FY16 9MFY15 9MFY16 Q3FY15 Q3FY16 9MFY15 9MFY16 LFL Growth 28% 19% 93% 36% 162% 35% Consolidated Revenue EBITD

  32. Slide 32: Presentation Structure

    Presentation Structure Introduction Our Businesses Financial Highlights Capex 32

  33. Slide 33: Capex plan

    Capex plan Capex Cash Outflow (Net of CWIP FY16 FY17 as on onward 1-4-15) Standalone VSF Expansion : Vilayat (120K TPA) – Residual Capex 1.4 Normal Capex : VSF 3.1 : Chemical & Others 2.6 Standalone Capex (A) 7.1 4.5 2.6 Cement Subsidiary Capacity expansion # 20.2 Logistic Infrastructure 6.6 RMC Bus

  34. Slide 34: Grasim Group Structure

    Grasim Group Structure Pulp & Fibre Chemical UltraTech Cement (60.25%) Others VSF VSF JV Pulp Overseas Caustic Epoxy Domestic Overseas 498K TPA China 70K TPA Pulp JVs 804K TPA 52K TPA 3 Mn. TPA, (UAE, Bangladesh, Sri Lanka) Grey Cement Grasim Birla Jingwei AV Cell Bhiwani 70K TPA (26%) 130K TPA (45%

  35. Slide 35: Thank You

    Thank You Contacts: Grasim Industries Limited (Corporate Finance Division) Aditya Birla Centre, S.K. Ahire Marg, Worli, Mumbai - 400 030 CIN: L17124MP1947PLC000410 Sharad Agarwal +91-22-66525062 [email protected] Shirin Sancheti +91-22-66525097 [email protected]

  36. Slide 36: Grasim Industries Limited – Supplement

    Grasim Industries Limited - A VSF and Cement Major (Supplement)

  37. Slide 37: Supplement

    Supplement • Consolidated Financial Performance • Standalone Financial Performance • Balance Sheet - Grasim • Balance Sheet – UltraTech (Consolidated) • Consolidated Businesswise Performance 37

  38. Slide 38: Consolidated Financial Performance

    Consolidated Financial Performance ` Bn. Quarter 3 % Nine Months % Full Year 2015-16 2014-15 Change 2015-16 2014-15 Change 2014-15 Net Sales & Op. Income 90.4 80.3 13 266.4 240.2 11 328.4 Other Income 0.8 0.6 36 2.8 4.3 (35) 5.4 EBIDTA 18.0 12.6 43 49.7 40.2 23 56.8 EBIDTA Margin (%) 19.7% 15.6% 18.

  39. Slide 39: Standalone Financial Performance

    Standalone Financial Performance ` Bn. Quarter 3 % Nine Months % Full Year 2015-16 2014-15 Change 2014-15 2013-14 Change 2014-15 Net Sales & Op. Income 23.4 15.6 50 64.4 46.0 40 63.3 Other Income 0.2 0.3 (23) 2.5 3.0 (15) 3.5 EBIDTA 4.8 2.1 128 13.7 8.3 64 10.1 EBIDTA Margin (%) 20.4% 13.3% 20.4% 17

  40. Slide 40: Balance Sheet - Grasim

    Balance Sheet - Grasim ` Bn. Standalone * Consolidated 31st Dec'15 31stMar'15 EQUITY & LIABILITIES 31st Dec'15 31stMar'15 123.7 111.8 Net Worth 252.9 231.4 - - Minority Interest 82.1 76.8 22.4 11.1 Borrowings 117.1 119.3 9.2 6.1 Deferred Tax Liability (Net) 40.7 34.1 16.9 14.5 Liabilities & Provisio

  41. Slide 41: Balance Sheet – UltraTech (Consolidated)

    Balance Sheet – UltraTech (Consolidated) ` Bn. * EQUITY & LIABILITIES 31st Dec'15 31stMar'15 Net Worth 206.4 190.4 Minority Interest 0.2 0.2 Borrowings 85.3 98.3 Deferred Tax Liability (Net) 31.3 27.9 Liabilities & Provisions 64.2 63.8 SOURCES OF FUNDS 387.3 380.5 ASSETS Net Fixed Assets 233.7 222.9

  42. Slide 42: Viscose Staple Fibre: Summary (Standalone)

    Viscose Staple Fibre : Summary (Standalone) Quarter 3 % Nine Months % Full Year 2015-16 2014-15 Change 2015-16 2014-15 Change 2014-15 Capacity* KTPA 125 115 9 374 317 18 434 Production (in '000s) MT 126 106 19 341 297 15 408 Sales Volumes (in '000s) MT 121 97 24 337 284 19 403 Net Revenue ` Bn. 16.0

  43. Slide 43: Chemical: Summary

    Chemical : Summary Quarter 3 % Nine Months % Full Year 2015-16 2014-15 Change 2015-16 2014-15 Change 2014-15 Capacity KTPA 201 113 78 559 339 65 453 Production (in '000s) MT 195 106 83 547 308 78 412 Sales Volumes (in '000s) MT 202 108 87 558 304 84 409 Net Revenue ` Bn. 8.7 4.4 97 24.8 12.7 95 17.0

  44. Slide 44: Cement: Summary

    Cement : Summary Quarter 3 % Nine Months % Full Year 2015-16 2014-15 Change 2015-16 2014-15 Change 2014-15 Grey Cement Capacity Mn. TPA 16.91 15.79 7 48.50 46.67 4 63.15 Production Mn. MT 12.01 11.31 6 36.31 34.26 6 46.71 Cement Sales Volumes $ Mn. MT 12.25 11.48 7 36.56 34.57 6 47.09 Clinker Sales

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