Grasim Industries Ltd. · NSE:GRASIM
Grasim Industries — Q3 FY19 Earnings Presentation
39 slides from Grasim Industries's earnings presentation, Feb 7, 2019
Slide 1: Cover letter to stock exchanges on Q3 results presentation
ADITYA BIRLA GRASIM Ref No. GIL/CFD/SEC/19/108/SE 7th February 2019 BSE Limited The Secretary Department of Corporate Services National Stock Exchange of India Ltd. 1st Floor, New Trading Ring, Exchange Plaza Rotunda Building, P J Towers, Dalal Street, Bandra-Kurla Complex, Bandra ( East) Fort, Mumb
Slide 2: India's New Growth Story – Q3 FY19 Performance Review
Grasim Industries Limited India’s New Growth Story Q3 FY19 Performance Review 7th February, 2019
Slide 3: Our Leadership Businesses
Our Leadership Businesses Viscose # Producer in India Caustic Soda Specialty Chemicals* (Epoxy resins, SBP, CP and others) Pulp & Fibre^ JVs UltraTech Cement Aditya Birla Capital Amongst Asset Global DG pulp Cement Producer Management # producer # in India Top companies$ Private Global Producer# Amo
Slide 4: Contents
CONTENTS Content Performance Financial Business Highlights Performance Performance Glossary ABCL: Aditya Birla Capital Ltd., FCF: Free Cash Flow, NBFC: Non Banking Finance Company, VSF: Viscose Staple Fibre, VFY: Viscose Filament Yarn, MT : Metric Ton, K: One Thousand, TPA : Tons Per Annum, YoY: Yea
Slide 5: Performance Highlights – Q3FY19
Performance Highlights – Q3FY19 Net Revenue (Rs. Cr.) EBITDA (Rs. Cr.) PAT (Rs. Cr.) 5,293 Cr. 1,111 Cr. 608 Cr. Up by 21% YoY Up by 21% YoY Up by 28% YoY 18,419 Cr. 2,958 Cr. 958 Cr. Up by 22% YoY Up by 11% YoY Up by 76% YoY ► Reported Standalone Revenue of Rs.5,293 Cr. recording a growth of 21% Yo
Slide 6: Content
Content Performance Financial Business Highlights Performance Performance Grasim Presentation – Q3FY19 5
Slide 7: Income Statement Q3 FY19
Income Statement Q3 FY19 Standalone % Consolidated % Particulars (Rs. Cr.) Q3FY19 Q3FY18 Change Q3FY19 Q3FY18 Change Net Revenue from Operations 5,293 4,377 21 18,419 15,153 22 Other Income 58 37 56 173 191 -10 EBITDA 1,111 920 21 2,958 2,675 11 EBITDA Margin (%) 21% 21% 16% 17% Finance Cost 41 30 4
Slide 8: Income Statement 9M FY19
Income Statement 9M FY19 Standalone Consolidated % Particulars (Rs. Cr.) % Change 9M FY19 9M FY18 9M FY19 9M FY18 Change Net Revenue from Operations 15,201 11,176 36 52,062 38,532 35 Other Income 464 367 27 591 660 -10 EBITDA 3,639 2,595 40 9,024 7,911 14 EBITDA Margin (%) 23% 22% 17% 20% Finance Co
Slide 9: Strong Consolidated Financials
Strong Consolidated Financials Financial Ratios Debt / Surplus ( Rs. Cr.) 22,402 31st Mar 31st Dec 2018 2018 13,575 Net Worth (Rs. in Cr.) 57,362 56,880 8,828 Debt Liquid Debt: Equity 0.27 0.33 investments Mar-18 27,444 Net Debt Net Debt: Equity 0.16 0.26 21,630 Net Debt/ EBITDA 1.25 1.80 5,814 Dec-
Slide 10: Strong Balance Sheet
Strong Balance Sheet Standalone Debt / Surplus ( Rs. Cr.) 3,358 2,969 AAA Rating 389 Debt Consistent Strong Free Liquidity Liquid Mar-18 Cash Flow Zero Net investments 3,630 generation Debt Surplus 2,605 No equity dilution - Growth funded by 1,025 internal accruals Dec-18 Robust FCF generation of Rs
Slide 11: Strong business model to deliver sustained earnings
Strong business model to deliver sustained earnings Last 10 Years Current Status - 9M FY19 Rs. Cr. Rs. Cr. ~21,000 Rs. 3,639 ~7,000 Rs. 1,240 ~2,500 Rs. 456* EBITDA Capex Dividend EBITDA Capex^ Dividend Payment# 9M FY19 Payment for FY18# ^ Total Capex planned for next 3 years is Rs. 7,627 Cr. Strong
Slide 12: Capex Plan
Capex Plan Capex* Cash Outflow Capex spent (Net of CWIP Particulars (Rs. Cr.) FY20 as on FY19 YTD Dec'18 1/4/2018) Onwards VSF: Brownfield Expansion (including debottlenecking) 4,156 Normal Capex (Water supply augmentation & usage 925 reduction, R&D, Environment and Others) Chemical: Brownfield Expa
Slide 13: Business Performance
Performance Financial Business Highlights Performance Performance Grasim Presentation – Q3FY19 12
Slide 14: Viscose Industry
Viscose Industry Global Prices Trend ($/Kg) 2.30 Grey 2.10 VSF 14,846 14,543 2.0% 1.90 (RMB Q2FY19 Q3FY19 QoQ 1.70 per ton) 1.50 Cotton 2.07 1.91 1.30 (USD 8.0% 1.10 per Kg) Q2FY19 Q3FY19 QoQ 0.90 Industry Data 0.70 0.50 PSF 1.30 1.19 8.0% (USD QoQ Jan-17 Jun-17 Feb-17 Sep-17 Jan-18 Jun-18 Feb-18 Se
Slide 15: Viscose business at a glance – Q3FY19
Viscose business at a glance – Q3FY19 Volume ► The share of domestic sales volume in the overall sales volume improved to 89% (Q3FY19) from 77% (Q3FY18) led by market Vibrant Domestic development efforts Demand ► 20 TPD capacity added during the quarter through debottlenecking Volume Up 17% YoY Cost
Slide 16: Business Performance: Viscose
Business Performance: Viscose Sales volume (KT)* Net Revenue EBITDA 1% 20% 3% ► The domestic market maintained a strong demand momentum in Q3FY19, with VSF business registering record sales volume of 119KT (102KT Q3FY18) ► The buoyancy in the domestic demand growth has been driven by our market deve
Slide 17: VSF Vilayat Project Progress – January 2019
VSF Vilayat Project Progress-January 2019 - since Ground breaking in Nov-18 Capacity 219 KTPA Commissioning Timeline FY21 Capex Commitment 40% (Jan-19) Grasim Presentation – Q3FY19 16
Slide 18: VSF Specialty Project Update (January 2019)
VSF Specialty Project Update (January 2019) Grasim Presentation – Q3FY19 17
Slide 19: Launched livaeco: The Ecofriendly fibre
Launched livaeco: The Ecofriendly fibre LIVA Tagging (Mn.) Livaeco garment has a unique molecular tracer which helps the end buyer trace the origin and full journey of the garment across the supply chain Fully Biodegradable in 6/8 weeks Livaeco also promises minimal usage of water vis-à-vis other na
Slide 20: Chlor Alkali Industry
Chlor Alkali Industry ► Chlor-Alkali prices were steady during the quarter with firm demand from consuming segments ► Caustic demand in domestic market is expected to remain balanced with good demand and stable pricing ► Chlorine is expected to drive the industry with stable demand growth as new dow
Slide 21: Chemical business at a glance – Q3FY19
Chemical business at a glance – Q3FY19 Volume ► Caustic soda reported 9% YoY increase in production volume ► Strong focus on growing the chlorine VAPs – Revenue up by 33% YoY Healthy Demand growth in ► The production ramp up from newly commissioned phosphoric acid plant Caustic and Chlorine VAP’s ex
Slide 22: Business Performance: Chemicals
Business Performance: Chemicals Sales volume* (KT) Net Revenues# EBITDA# 10% 19% 23% ► Caustic Soda reported 10% YoY increase sales volume ► Market expansion in the eastern India helped sustain the sales volume ► EBITDA up by 23% YoY, supported by higher ECU realization and better sales volume ► Chl
Slide 23: Chemicals VAP Project Update (Commissioning June-2019)
Chemicals VAP Project Update (Commissioning June-2019) Grasim Presentation – Q3FY19 22
Slide 24: Business Performance: DG Pulp JVs
Business Performance: DG Pulp JVs Pulp prices ($/Mt) Net Revenues (Rs. In Cr.) 950 930 910 890 Up by 23% YoY 870 850 EBITDA (Rs. In Cr.) 830 Down by April May June July Aug Sept Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 17 17 17 17 17 17 17 17 17 18 18 18 18 18 18 18 18 18 18 18 18
Slide 25: Business Performance: UltraTech
Business Performance: UltraTech Sales volume (MT) Net Revenue (Rs. Cr.) EBITDA (Rs. Cr.) 15% 19% 4% ► Industry demand growth at 9-10% in Q3FY19 ► Average cement prices down by 1-2% QoQ ► Operating Costs increased on YoY basis (Logistics up 4% YoY, Energy up 16% YoY and Raw material up 3% YoY) ► Dema
Slide 26: Business Performance: ABCL
Business Performance: ABCL Lending Book(Rs. Cr.)* AUM(Rs. Cr.) ► Revenue and Net profit after minority interest for Q3FY19 are at Rs. 3,780 Cr. and Rs.206 Cr ► Lending book (Incl. housing) grew 29% YoY to Rs.60,129 Cr., backed by well-matched Asset and Liability mix Raised about Rs.9,000 Cr. Of lo
Slide 27: Business Performance – Other Businesses
Business Performance- Other Businesses Net Revenue (Rs. Cr.) EBITDA (Rs. Cr.) Fertilizers Higher sales volume and better operational efficiency Textile Better Sales volume and improvement in realization Insulator Demand conditions remain weak Grasim Presentation – Q3FY19 26
Slide 28: Thank You
THANK YOU Grasim Presentation – Q3FY19 27
Slide 29: Consolidated Financial Performance
Consolidated Financial Performance Quarter 3 % YTD Dec % Particulars (Rs. Cr.) 2018-19 2017-18 Change 2018-19 2017-18 Change Net Sales & Op. Income 18,419 15,153 22 52,062 38,532 35 Other Income 173 191 -10 591 660 -10 EBITDA 2,958 2,675 11 9,024 7,911 14 Finance Cost 465 388 1,284 967 Finance Cost
Slide 30: Standalone Financial Performance
Standalone Financial Performance Quarter 3 YTD Dec Particulars (Rs. Cr.) % % 2018-19 2017-18 2018-19 2017-18 Change Change Net Sales & Op. Income 5,293 4,377 21 15,201 11,176 36 Other Income 58 37 56 464 367 27 EBITDA 1,111 920 21 3,639 2,595 40 Finance Cost 41 30 152 80 Depreciation 193 166 563 442
Slide 31: Balance Sheet
Balance Sheet Standalone (Rs. Cr.) Consolidated (Rs. Cr.) 31st Dec'18 31st Mar'18 EQUITY & LIABILITIES 31st Dec'18 31st Mar'18 43,602 44,790 Net Worth 56,880 57,362 - - Non Controlling Interest 27,096 26,337 - - Borrowings related to financial services 53,909 44,667 2,605 2,969 Other Borrowings * 27
Slide 32: Viscose Business Summary
Viscose Business Summary Quarter 3 % YTD Dec % Particulars 2018-19 2017-18 Change 2018-19 2017-18 Change Capacity VSF KTPA 546 498 10 546 498 10 VFY KTPA 47 - 47 - Production VSF KT 141 127 11 412 387 6 VFY KT 12 5 35 5 Sales Volume VSF KT 134 133 1 402 384 5 VFY KT 11 5 35 5 Net Revenue Rs. Cr. 2,6
Slide 33: Chemical Business Summary
Chemical Business Summary Quarter 3 % YTD Dec % Particulars 2018-19 2017-18 Change 2018-19 2017-18 Change Capacity KTPA 1,140 840 36 1,140 840 36 Production* KT 250 228 9 740 646 15 Sales Volume* KT 250 226 10 742 644 15 Net Revenue Rs. Cr. 1,559 1,314 19 4,749 3,566 33 EBITDA Rs. Cr. 441 359 23 1,3
Slide 34: Cement Business Summary
Cement Business Summary Quarter 3 % YTD Dec % Particulars 2018-19 2017-18 Change 2018-19 2017-18 Change Capacity* Mn. TPA 101 89 14 101 89 14 Production (Grey) Mn. MT 18 16 15 51 43 19 Sales Volume (Grey + White) Mn. MT 19 17 15 54 45 20 Net Revenue Rs. Cr. 9,390 7,900 19 26,527 21,688 22 EBITDA Rs.
Slide 35: Grasim: Group Structure
Grasim: Group Structure VSF - 546K TPA Caustic Soda - UTCL (60.20%)* ABCL (55.99)* Overseas VFY - 47K TPA ~1140K TPA Others Subsidiary Pulp & VSF JVs Subsidiary Pulp - 70K TPA Epoxy – 94K TPA Domestic NBFC Broking Nagda Nagda Fertilizers AV Group NB (100%)* (75%)* 155K TPA 270K TPA Inc. Grey Cement
Slide 36: Forward Looking & Cautionary Statement
Forward Looking & Cautionary Statement Certain statements in this report may be “forward looking statements” within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expressed or implied. Important factors that could make a difference to the
Slide 37: Notes
NOTES Grasim Presentation – Q3FY19 36
Slide 38: Notes
NOTES Grasim Presentation – Q3FY19 37
Slide 39: Grasim Industries Limited – Quarterly Performance Review
Grasim Industries Limited Quarterly Performance Review Q3 FY19, 7th February 2019 Grasim Presentation – Q3FY19 38