Arvind Limited · NSE:ARVIND
Arvind — Investor Presentation (May 2016)
20 slides from Arvind's investor presentation, May 2016
Slide 1: Arvind 3.0 Investor Presentation May 2016
Arvind 3.0 Investor Presentation May 2016
Slide 2: Agenda
Agenda • FY2016 – at a glance • Strategic agenda – Brands and Retail • Value creation case 2
Slide 3: Robust revenue growth while maintaining margins, returns and stable leverage
Over the last 5 years, we have achieved robust revenue growth, while maintaining margins, returns and a stable leverage 14% overall top-line growth during Margins maintained on ..and robust returns the last 5 years an overall basis… with stable leverage Op. Rev, Rs Cr Margins % D/E % D/EBIDTA 9,000
Slide 4: Recap: Arvind's growth and value creation agenda driven by two strategic journeys
Recap: Arvind’s growth and value creation agenda driven by two parallel strategic journeys Opportunity Arvind’s strategic journeys Value creation logic 1 Brands & Retail: Break-through growth • Portfolio of high and moderate growth – Industry leading portfolio of brands: businesses own and licensed
Slide 5: Fabric business delivered strong EBITDA and ROCE growth despite volatility
Fabric business has delivered strong EBITDA and ROCE growth despite volatile external environment 10% top-line growth in fabrics was coupled with ..while cotton prices and US$ expanded margin, improved ROCE and cashflows… remained highly volatile 19.5% 150 Margin Cotton Price (c/lb) expansion, 18.1
Slide 6: Vertical garmenting will dominate the agenda for our fabrics business
Vertical garmenting will dominate the agenda for our fabrics business Top-line from garmenting grew by 10+ customers already served through ~20% in FY2016 vertical offering – clear plans to step-up % of fabric output sold as garment ~ 20-22% 1,000 +18% 883 800 712 672 600 504 ~ 6% 460 400 200 FY 15-
Slide 7: Brands & Retail business has achieved breakthrough growth
Brands & Retail business has achieved breakthrough growth, increased revenue by 2.5x over last 5 years Sales growing at 25%+ yoy Strong and improving bottom line Capital efficiency : Poised to Improve EBIDTA (Rs Cr) ROCE (%) Sales (Rs. Cr) 2,740 178 8.7% 2,361 7.7% +25% +27% 1,915 122 5.5% 97 1,314
Slide 8: Power Brands strong growth and margin expansion; growth brands positive EBITDA
Power Brands delivered strong revenue growth and margin expansion, while growth brands started delivering positive EBITDA Power Brands delivered steady growth, Growth Brands collectively delivered +ve increasing profitability EBITDA, as they grew rapidly Revenues Rs Cr Revenues Rs Cr 2,000 +21% 500
Slide 9: Specialty retail forays successful; value retail restructuring delivering
Specialty retail forays were very successful, while re-structuring of discount/value retail started to deliver results Successful debutants in specialty retail Mega-mart relaunched as Unlimited • Enabled play in new fast growing categories – • Restructuring agenda youth, children’s wear and women’s
Slide 10: Agenda
Agenda • FY2016 – at a glance • Strategic agenda – Brands and Retail • Value creation case 10
Slide 11: Indian apparel demand at the cusp of significant growth
Indian apparel demand is at the cusp of significant growth as the economy crosses $2000 GDP per capita China apparel consumption took-off Indian apparel consumption Branded segment to grow at $2k GDP per capita stands to grow significantly at 1.5x the overall market USD per capita Billion USD ‘000 U
Slide 12: Arvind well positioned to be India's lifestyle powerhouse by 2020
Arvind is well positioned to be India’s lifestyle powerhouse by 2020 Strong portfolio of iconic global brands Robust platform and industry leading across all market segments/ formats capabilities to enable the growth Powerful Platforms For Sustained Growth Brand Relationships 3. Global Supply 1. Go-
Slide 13: Our agenda in Brands and Retail driven by three sets of priorities
Our agenda in Brands and Retail will be driven by 3 clear sets of priorities 1 • Build on the power brands through category and channel expansion Consolidate existing • Specialty retail to quickly gain strength due to strengths of brands business • Growth brands moving towards double digit EBITDA •
Slide 14: Key priority of B&R over next two years: grow topline with improved profitability and ROCE
1 Consolidate existing businesses Key Priority of the Brands & Retail business over the next Two Years is to grow Topline with Improved Profitability and ROCE Top-line expected to grow at 25%+… … and EBITDA at 35%+ Healthy returns • ROCE will improve 2x 4,618 466 to reach 16-18% range 25-26% 35-38%
Slide 15: Strategically manage the B&R portfolio
2 Strategically manage portfolio We will continue to manage our B&R portfolio to ensure that we meet the evolving market needs while balancing financial performance Critical to dynamically maintain B&R portfolio Calibrated additions to B&R portfolio • Large opportunities with potential to • ‘Current
Slide 16: Arvind launched NNNOW.com omni-channel portal
3 Powerful Omni/ Digital play Arvind Ltd. has launched NNNOW.com – a powerful omni-channel portal that integrates online and offline shopping Arvind Internet Offer Integral to B&R Strategy • Official online channel for ALBL brands • Platform for creating own-brands or brand extensions in select cate
Slide 17: Healthy growth, profitability and capital efficiency in quest to $1B in B&R by 2020
We expect to clock healthy growth, profitability and capital efficiency in our quest to $1B in B&R by 2020 Sales growing at ~22%+ yoy Strong bottom line growth Improving capital efficiency Sales (Rs. Cr) EBIDTA (Rs. Cr) ROCE (%) 22% - 25% 30% - 35% 20% - 25% 2740 5.5% 2361 3.9% 178 122 FY15 FY16 FY1
Slide 18: Agenda
Agenda • FY2016 – at a glance • Strategic agenda – Brands and Retail • Value creation case 18
Slide 19: Summary of value creation agenda over next 4-5 years
Summary of value creation agenda over next 4-5 years GROWTH PROFITABILITY Maintain 15% overall topline growth EBITDA growth in tandem with topline • Target yoy improvement in margins in B2C • Powered by 25-30% continuing growth in business as B2C businesses • Almost all brands/Retail formats are • M
Slide 20: Thank You!
Thank You!