Aries Agro Ltd. · NSE:ARIES
Aries Agro — Investor Presentation (August 2010)
30 slides from Aries Agro's investor presentation, Aug 16, 2010
Slide 1: Energizing Earth
Energizing Earth AUGUST 2010 1
Slide 2: Aries' Unique Niche
Aries’ Unique Niche Commodity Water Soluble NPK Secondary Value added Inorganic NPK Fertilizers Fertilizers nutrients Micronutrients Micronutrients Aries Presence X √ √ √ √ Typical products Urea, DAP, 20-20-20, 13-0-45, Ca, Mg, S Chelates Sulphates SOP 0-52-34, 0-0-50 Price Control √ X X X X Subsidi
Slide 3: Aries Agro (Standalone): Installed Capacities and Utilization
Aries Agro (Standalone) : Installed Capacities and Utilization Installed Capacity Installed Capacity Capacity Capacity Location Capacity Utilization Capacity Utilization Utilization Utilization 2008-09 2008-09 2009-10 2009-10 2010-11E 2011-12E (MT) % (MT) % % % Mumbai 10,800 64.11 10,800 50.95 80.00
Slide 4: All India Rainfall
All India Rainfall • Status up to August 11, 2010 shows a positive outlook • 91% Meteorological sub-divisions show normal to excess rain so far • All India Departure from Normal is only 4% from the long period average • MP, UP, Bihar, Jharkhand, WB and Assam are rain deficient as of mid-August • The
Slide 5: Our Wake up Call
Our Wake up Call 2004- 2005- 2006- 2008- 2001-02 2002-03 2003-04 05 06 07 2007-08 09 2009-10 Net Sales 2,759 1,913 2,729 3,943 5,936 7,405 10,338 11,044 13,975 % districts with normal or excess rainfall 67% 39% 77% 56% 72% 60% 72% 76% 41% Sales Growth % 13% -31% 43% 45% 51% 25% 40% 7% 27% 16000 1400
Slide 6: Reduced Rain Dependence
Reduced Rain Dependence • Correlation of 9 years sales growth with 9 years rainfall data • Correlation between rainfall and Aries sales growth is NOT STATISTICALLY SIGNIFICANT • Correlation coefficient between Aries Sales Growth and percentage of districts receiving normal rainfall is only 0.508 • C
Slide 7: Wide Distribution of Revenues
Wide Distribution of Revenues 7
Slide 8: Strong Marketing Network
Strong Marketing network Aries has 344 trained marketing personnel 25 branches spread across 22 states AAL First link of distribution channel has more than 5600 distributors 344 Marketing personnel providing technical support Direct access to 79000+ retail dealers Database of purchase reco
Slide 9: Meeting the Challenges of the Changing Seasons
Meeting the Challenges of the Changing Seasons Deliberate focus on developing cash crop Quantitative Quantitative Volume markets Sales (MT) Sales (MT) Growth % Reduced focus on cereals grown in Kharif 2008-09 2009-10 season 24,666 MT 40,765 MT + 65.27 % Campaigns during Rabi season for horticu
Slide 10: New Product Launches - Update
New Product launches - Update in Lakhs Products 2009-10 2010-11 E Bio Degradable Chelates 68 180 Natural Amino Acid Chelates 222 308 Sea Weed Extract 131 237 Water Treatment Formulation 41 104 Calcium Nitrate Derivatives 82 135 Agricultural Sprayers 23 473 TOTAL – NEW PRODUCTS 568 1437 15 successful
Slide 11: Typical Seasonality of Indian Operations
Typical Seasonality of Indian Operations Q1 (Apr - Jun) Q2 (Jul – Sep) Q3 (Oct – Dec) Q4 (Jan – Mar) Annual Revenues – Nutrients 10% 30% 35% 25% 100% Revenues - Insecticides -- 35% 50% 15% 100% Revenues - Sprayers 35% 35% 30% -- 100% Inventory (across all High – to build Highest High Reduces by Idea
Slide 12: A Fleet of Krishi Vigyan Vahans
A Fleet of 100 Krishi Vigyan Vahans 12
Slide 13: Aries KVVs: Researched & applauded by the Wall Street Journal
Aries KVVs : Researched & applauded by the Wall Street Journal Video and Article available online : http://online.wsj.com/article/NA_WSJ_PUB:SB 125558077864186837.html 13
Slide 14: KVV Operations – Progress so far
KVV Operations – Progress so far # OF KVVS as NO OF VILLAGES AVG STATE on 31 July LAUNCH DATE KMS COVERED IN ROUTE DISTANCE/DAY AP 31 9-Jul 617,807 1800 77 KM TN 11 11-Jul 282,770 450 73 KM NIPANI 4 15-Jul 87,250 280 65 KM BIHAR 10 22-Jul 198,980 340 77 KM WEST UP 7 24-Jul 145,860 300 72 KM HARYANA
Slide 15: KVV Operations – Cost versus Revenues
KVV Operations – Cost versus Revenues COST AS A BOOKINGS AVG % OF GENERATED COST/KVV/ TOTAL COST COST/KM BOOKINGS STATE (Rs in LAKHS) BOOKINGS/KM MONTH INCURRED (IN Rs) (IN Rs) GENERATED AP 318 51 22000 1634270 3 5% TN 296 105 16000 356818 1 1% NIPANI 51 58 18000 424987 5 8% BIHAR 171 86 28000 16818
Slide 16: Golden Harvest Middle East FZC, Sharjah
Golden Harvest Middle East FZC, Sharjah • First of Aries’ Chelates Manufacturing Unit overseas • Commenced commercial production in October 2008 • 25% sold to Aries in 2009-10, 75% sold to other customers located in Nepal, Bangladesh, UAE, Taiwan & Uganda • Y-o-Y Quantity manufactured of Chelates up
Slide 17: Amarak Chemicals FZC, Fujairah
Amarak Chemicals FZC, Fujairah • Largest overseas investment of Aries • Trial Production commenced : July 2010 • Quantity produced & sold to Aries : 1200 MT Rationale : • Proximity to UAE’s oil refineries for Sulphur by products which are the main raw materials • Proximity to Asian markets, especial
Slide 18: Amarak Chemicals FZC, Fujairah
Amarak Chemicals FZC, Fujairah BENTONITE INCLUSION SULPHUR RE-MELTER HIGH CAPACITY BOILER PASTILLIZATION BELTS 18
Slide 19: Amarak Chemicals FZC, Fujairah: Current Project Status
Amarak Chemicals FZC, Fujairah : Current Project Status • Installation of all manufacturing equipments for 60000 MT capacity of Sulphur Bentonite completed in April 2010 • Showcase of factory to 200 Chairman’s Club customers in end-April 2010 • Onsite booking received for 9000 MT • Annual contract f
Slide 20: Growing Demand for Sulphur in Agriculture
Growing Demand for Sulphur in Agriculture 20
Slide 21: Markets for Amarak: Sulphur Deficit Regions of the World
Markets for Amarak : Sulphur Deficit Regions of the World 21
Slide 22: Marketing Strategy for International Business
Marketing Strategy for International Business • Distributors appointed and sales have commenced : Nepal, Bangladesh, UAE, Taiwan & Uganda. • MoU for registration of products : Romania, Hungary, Bulgaria, Poland, France & Finland. • Agents appointed : UAE & North Africa. • A global business team, loc
Slide 23: Aries Group: Our Growth Story
Aries Group : Our Growth Story in Crores 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 E E Sales 74.1 103.3 113.1 152.45 225 295 PBT 14.0 18.1 8.3 23.86 39.15 53.00 PAT 8.7 14.2 6.4 16.24 29.00 40.25 2009-10 2010-11 Q1 Sales 18.19 21.75 Q2 Sales 33.59 50.00 (E) H1 Sales 51.78 71.75 (E)
Slide 24: Aries Group – Consolidated Global Operations
Aries Group – Consolidated Global Operations in Crores 2009-10 2010-11 E 2011-12 E Sales EBIDTA Sales EBIDTA Sales EBIDTA Aries Agro 134.39 28.26 175 38.50 205 47.00 Indian Subsidiaries 2.18 0.38 5 0.75 10 1.50 Golden Harvest 15.88 5.69 20 5.00 30 7.50 Amarak Chemicals - - 25 6.00 50 12.50 TOTAL : 1
Slide 25: Spreading Knowledge in Rural Communities
Spreading Knowledge in Rural Communities • UniConnect • Bal Krishak Sambodhan • Suryodaya 4000 students in 50 Rural schools conducted by Aries expert staff to expose students to latest knowledge of agricultural practices 66 structured lab-to-land programmes that connected university faculty, res
Slide 26: Strategic CSR Initiatives - 1
Strategic CSR Initiatives - 1 Environmentally Sensitive Chelates form the flagship product range Water Soluble packaging eliminates use of plastic and aluminium foil Helping Indian Rural farmers understand and strategize to deal with Climate Change Knowledge spread in rural communities Uni
Slide 27: Strategic CSR Initiatives - 2
Strategic CSR Initiatives - 2 Encouraging Innovation in Farming Next Practices Advisory Services through MCX’s Grameen Suvidha Kendra Network Certifying Essential Skills to increase employability of rural youth Philanthrophy National Association for the Blind, Gujarat – classrooms for blin
Slide 28: Key Takeaways
Key Takeaways Vast experience of the Promoter Group Highly qualified and experienced management team Locational advantage of manufacturing units, branches and distribution network Unmatched distribution reach, including a fleet of 100 Rural Retail Vehicles International manufacturing base
Slide 29: Energizing Earth
Energizing Earth Aries House, Plot No.24, Deonar, Govandi (East), Mumbai 400 043, India. www.ariesagro.com 29
Slide 30: Industry | The Wonder of Chelation Technology
Industry | The Wonder of Chelation Technology Nutrients can be applied to crops in inorganic form or Chelate form 60% of inorganic compounds are wasted by leaching, fixation and due to its property of reacting easily with air, water & soil Aries products, which are Chelated, are able to delive