Grasim Industries Ltd. · NSE:GRASIM
Grasim Industries — Investor Presentation (November 2015)
44 slides from Grasim Industries's investor presentation, November 2015
Slide 1: Grasim Industries Limited
Grasim Industries Limited A VSF and Cement Major November 2015
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
Slide 3: Presentation Structure
Presentation Structure Introduction Our Businesses Financial Highlights Capex 3
Slide 4: The Aditya Birla Group
The Aditya Birla Group Amongst the top business houses in India Operations spread over 36 countries Revenue at $41 Bn., Over 50% from overseas operations Anchored by 120,000 employees, belonging to 42 nationalities Ranked 1st in India by Nielson Corporate Image Monitor consecutively for 3
Slide 5: The Aditya Birla Group: Leadership Across Businesses
The Aditya Birla Group : Leadership Across Businesses Leading Global Player – Hindalco – Novelis is the largest aluminum rolling company – Largest producer of carbon black – One of the two largest producers of VSF – Fourth-largest producer of insulators and acrylic fibre Leadership position in India
Slide 6: Grasim: Market leader across Business Segments
Grasim: Market leader across Business Segments Viscose Staple Leading Global Player Fibre – Capacity : 498K TPA Revenue ` 66 Bn. – Grasim commands 9% Global share; ABG share 17% (US$ 1.1 Bn.) – Integrated model with experience of more than six decades Largest Chlor-Alkali Manufacturer in India – Cap
Slide 7: Investment in Growth
Investment in Growth Substantial Investment made across Businesses – US$ 4 Bn. over last five years..... VSF * Caustic * Cement * Gross Fixed Asset KTPA KTPA 55% Rs. Cr Mn. TPA 50% 310% 110% 30% 74.8# 75% 45577 498 804 69.3 63.2 334 452 48.8 21717 258 FY 10 FY 15 FY 10 FY 15 FY 16 FY 10 FY 15 FY 16
Slide 8: Yielding Results
……Yielding Results Driving Robust Volume Growth VSF ('000) Caustic ('000) Cement (Mn. Tons) 409 48.2 403 44.7 44.0 43.6 367 314 41.6 336 39.6 266 269 308 305 307 230 241 FY10 FY11 FY12 FY13 FY14 FY15 FY10 FY11 FY12 FY13 FY14 FY15 FY10 FY11 FY12 FY13 FY14 FY15 .....and Revenue Growth ` Bn. VSF Causti
Slide 9: Consolidated Business Mix – H1 FY16
Consolidated Business Mix – H1 FY16 Net Revenue - ` 170 Bn. EBITDA - ` 30 Bn. 0.2 0.9 8.3 10.1 1.9 3.5 26.9 124.4 23.9 9
Slide 10: Presentation Structure
Presentation Structure Introduction Our Businesses Financial Highlights Capex 10
Slide 11: Viscose Staple Fibre (VSF)
Viscose Staple Fibre (VSF) Birla Viscose Birla Modal Birla Excel
Slide 12: 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 ABG group (incl. Grasim) : 935 67% of which Grasim : 498
Slide 13: VSF: Fastest Growing Fibre
VSF : Fastest Growing Fibre (Mn. Ton) VSF PSF 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 – Rising prosperity in emerging econ
Slide 14: 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 Co. Pulp Plant - Own Pulp Plant - JV 14
Slide 15: 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
Slide 16: VSF: H1 FY16 Performance
VSF: H1 FY16 Performance H1 Global Industry Scenario (` Bn.) 2013-14 2014-15 2015-16 Increase in global prices in H1 FY16 after prolonged decline Capacity (‘000 Ton)* 375 434 249 Rise in raw material cost and stoppage of few plants in China for environmental issues and maintenance Sales Volume (
Slide 17: VSF: Outlook
VSF: Outlook VSF continues to hold favorable position in comparison to other fibres $/ Kg Preference for comfort fabric leading to increase in demand for high 2.3 International Fibre Prices 2.1 1.90 quality cellulosic fibre 1.9 Rising population and increasing prosperity in developing 1.7 1.52
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
Slide 19: Chemical Business: H1 FY16 Performance
Chemical Business : H1 FY16 Performance H1 Business Performance (` Bn.) 2013-14 2014-15 2015-16 Revenue up by 21% Capacity (000’ Ton)* 352 452 226 Epoxy volumes up by 78% with product approvals from major customers in place Sales Volume Caustic Soda 314 409 220 Vilayat Caustic plant achieved ~
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
Slide 21: Cement
Cement ``q India’s Largest Selling Brand No. 1 RMC player in India Different Products to provide No.1 Player of White Cement With > 100 plants complete Building Solutions & Cement based Putty
Slide 22: Indian Cement Industry: Overview
Indian Cement Industry : Overview Second largest cement market in world Cement Capacity ~ 399 Mn. TPA Fast growing cement market : CAGR 8% (last decade) Long term average growth has been 1.2 x of GDP Industry capacity more than doubled in last decade Around 70 million tons capacity added
Slide 23: 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 1,780 830 600 470 355 280 255 200 81 71 72 68 USA World Turkey China Brazil India Russia USA China Turkey India Brazil Russia ______________________________
Slide 24: Cement – Major Growth Drivers in India
Cement – Major Growth Drivers in India Favorable demographics with growing young population Rising affordability - Increasing income level Government vision of house for every family by 2022 Housing Rapid Urbanisation (28.7% in 2005 to exceed 40% by 2030) No. of Cities with population of 1
Slide 25: 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 Lower a
Slide 26: Cement Business: Key Strengths
Cement Business : Key Strengths Excellent growth record Capacity (Mn. Tons) From 8 Mn. TPA in FY2000 to ~75 Mn. TPA 63.2 74.8# Grew organically as well as inorganically 51.8 67.7 Market Leadership 35.0 29.7 “UltraTech” – Premium brand, largest in India 14.2 Leadership in key consuming ma
Slide 27: Cement Business Footprint – A Pan India Player
Cement Business Footprint – A Pan India Player Current Mix FY16 Mix North 19.0 29% 23.9 34% East 9.8 15% 11.4 16% Bhatinda Panipat West 20.5 32% 20.5 28% Jhajjar Dadri Kotputli Aligarh South 15.5 24% 15.5 22% Jodhpur P All India 64.7 100% 71.2 100% Shambhupura Sewagram Patliputra Wanakbori Jawad Kat
Slide 28: Cement Business: H1 FY16 Performance
Cement Business : H1 FY16 Performance Industry Scenario H1 (` Bn.) 2013-14 2014-15 Industry off take estimated flat at ~1% 2015-16 Low capacity utilisation for the sector Capacity (Mn. Ton) 57.0 63.2 33.8 Positive signs on cost front with softening of petcoke costs Sales Volume Raw material
Slide 29: Cement Business: Strategy for profitable growth
Cement Business: Strategy for profitable growth Capacity to increase to ~75 Mn. TPA on completion of existing projects and acquisition Grinding unit in Bihar : 1.6 Mn. TPA Grinding unit in Bahrain : 0.6 Mn. TPA Acquisition of JAL’s Bela and Siddhi units : 4.9 Mn. TPA Strengthening cost com
Slide 30: Presentation Structure
Presentation Structure Introduction Our Businesses Financial Highlights Capex Summary 30
Slide 31: Financial Performance – Q2 / H1FY16
Financial Performance – Q2 / H1FY16 Standalone Amount in ` Cr. Revenue EBITDA Net Profit 15% 17% 35.0 10% 7.3 30.4 13% 4.4 15% 6.2 4.1 15% 4.9 3.4 4.3 3.0 18.4 16.0 Q2FY15 Q2FY16 H1FY15 H1FY16 Q2FY15 Q2FY16 H1FY15 H1FY16 Q2FY15 Q2FY16 H1FY15 H1FY16 Consolidated Revenue EBITDA Net Profit 6% 9% 8% 159
Slide 32: Presentation Structure
Presentation Structure Introduction Our Businesses Financial Highlights Capex 32
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 1.6 Nagda Revamp 1.5 Normal Capex : VSF 2.6 : Chemical & Others 1.5 Standalone Capex (A) 7.2 4.3 3.0 Cement Subsidiary Capacity expansion # 16.8 Logistic Infrastru
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 452K TPA 51K TPA 3 Mn. TPA, (UAE, Bangladesh, Sri Lanka) Grey Cement Grasim Nagda Birla Jingwei Harihar AV Cell Nagda Bhiwani 67.7 Mn
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]
Slide 36: Grasim Industries Limited (Supplement)
Grasim Industries Limited - A VSF and Cement Major (Supplement)
Slide 37: Supplement
Supplement • Consolidated Financial Performance • Standalone Financial Performance • Balance Sheet - Grasim • Balance Sheet – UltraTech (Consolidated) • Consolidated Businesswise Performance 37
Slide 38: Consolidated Financial Performance
Consolidated Financial Performance ` Bn. Quarter 2 % Half Year % Full Year 2015-16 2014-15 Change 2015-16 2014-15 Change 2014-15 Net Sales & Op. Income 83.9 79.4 6 169.9 159.9 6 328.4 Other Income 0.9 1.0 (15) 2.0 3.7 (46) 5.4 EBITDA 14.9 12.8 16 30.2 27.7 9 56.8 EBITDA Margin (%) 17.5% 15.9% 17.5%
Slide 39: Standalone Financial Performance
Standalone Financial Performance ` Bn. Quarter 2 % Half Year % Full Year 2015-16 2014-15 Change 2015-16 2014-15 Change 2014-15 Net Sales & Op. Income 18.4 16.0 15 35.0 30.4 15 63.3 Other Income 2.1 2.1 (2) 2.3 2.7 (14) 3.5 EBITDA 4.9 4.3 15 7.3 6.2 17 10.1 EBITDA Margin (%) 24.0% 23.5% 19.5% 18.8% -
Slide 40: Balance Sheet - Grasim
Balance Sheet - Grasim Standalone Consolidated ` Bn. * 30th Sep'15 31 st Mar'15 EQUITY & LIABILITIES 30th Sep'15 31st Mar'15 116.3 111.8 Net Worth 241.6 231.4 - - Minority Interest 79.9 76.8 10.1 11.2 Borrowings 112.6 119.3 7.1 6.2 Deferred Tax Liability (Net) 36.9 34.1 13.7 14.5 Liabilities & Provi
Slide 41: Balance Sheet – UltraTech (Consolidated)
Balance Sheet – UltraTech (Consolidated) ` Bn. EQUITY & LIABILITIES * 30th Sep'15 31st Mar'15 Net Worth 200.8 190.4 Minority Interest 0.1 0.2 Borrowings 93.2 98.3 Deferred Tax Liability (Net) 29.7 27.9 Liabilities & Provisions 63 63.8 SOURCES OF FUNDS 386.9 380.5 ASSETS Net Fixed Assets 230.8 222.9
Slide 42: Viscose Staple Fibre: Summary (Standalone)
Viscose Staple Fibre : Summary (Standalone) Quarter 2 % Half Year % Full Year 2015-16 2014-15 Change 2015-16 2014-15 Change 2014-15 Capacity* K TPA 125 108 15 249 202 23 434 Production K MT 121 101 20 215 191 13 408 Sales Volumes K MT 114 101 13 216 187 16 403 Net Revenue ` Bn. 14.4 12.7 13 26.9 23.
Slide 43: Chemical: Summary
Chemical : Summary Quarter 2 % Half Year % Full Year 2015-16 2014-15 Change 2015-16 2014-15 Change 2014-15 Capacity K TPA 113 113 - 226 226 - 453 Production K MT 113 102 12 213 202 6 412 Sales Volumes K MT 118 98 20 220 196 12 409 Net Revenue ` Bn. 5.2 4.2 26 10.1 8.3 21 17.0 EBITDA ` Bn. 0.9 0.8 17
Slide 44: Cement: Summary
Cement : Summary Quarter 2 % Half Year % Full Year 2015-16 2014-15 Change 2015-16 2014-15 Change 2014-15 Grey Cement Capacity Mn. TPA 16.90 15.45 9 33.80 30.85 10 63.15 Production Mn. MT 11.45 10.91 5 24.30 22.95 6 46.71 Cement Sales Volumes $ Mn. MT 11.44 10.92 5 24.31 23.09 5 47.09 Clinker Sales V
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