Everest Kanto Cylinder Limited · NSE:EKC
Everest Kanto Cylinder — Investor Presentation (July 2020)
39 slides from Everest Kanto Cylinder's investor presentation, Jul 29, 2020
Slide 1: Regulation 30 disclosure cover letter
July 29, 2020 To, BSE LIMITED National Stock Exchange of India P.J. Towers, Ltd. Dalal Street, Exchange Plaza, Mumbai – 400 001 Bandra Kurla Complex, Bandra (East), Mumbai – 400051 BSE Scrip Code: 532684 NSE Symbol: EKC NSE Series: EQ Dear Sir(s), Sub: Disclosure under Regulation 30 of SEBI (Listing
Slide 2: Everest Kanto Cylinder Limited Investor Presentation July 2020
Everest Kanto Cylinder Limited Investor Presentation July 2020
Slide 3: Safe Harbor
Safe Harbor Certain statements in this communication may be ‘forward looking statements’ within the meaning of applicable laws and regulations. These forward-looking statements involve a number of risks, uncertainties and other factors that could cause actual results to differ materially from those
Slide 4: Table of Contents
Table of Contents Company Overview 4 Industry Overview 16 Key Attributes 22 Financial Overview 26 3
Slide 5: Company Overview
Company Overview
Slide 6: The 'EKC' Edge
The ‘EKC’ Edge #1 Market Leadership • India’s largest player in high pressure gas cylinders with market share of ~50% 42 Years Experienced Management • 42 years of focused domain experience in the field of high pressure seamless cylinder manufacturing • More than 200 SKU’s including Industrial, CNG
Slide 7: Key Milestones
Key Milestones Set up marketing/product Significantly scaled up supply Commissioned development subsidiary in of medical oxygen cylinders second plant at Doubled capacity at Germany used in the fight against the Tarapur Dubai Plant Closed Aurangabad plant COVID-19 pandemic Initiated Acquired majorit
Slide 8: Board of Directors
Board of Directors Executive Chairman Managing Director Independent Director • Joined EKC business in 1994 • Joined EKC business in 1996 • Finance, Banking and Law professional • Commerce graduate from Mumbai University • MBA (International Business) from EU Business • Specializes in audit, taxation
Slide 9: Global Footprint
Global Footprint Germany Hungary Delhi Kandla SEZ, USA Gujarat Dubai Mexico Thailand India Tarapur, Mumbai Pittsburgh, PA Colombia Maharashtra Peru Bangalore Jabel Ali Free Jabel Ali Free Zone (North) Zone (South) Manufacturing Locations Sales & Marketing Offices 8
Slide 10: Corporate Structure
Corporate Structure Everest Kanto Cylinder Limited (EKC) EKC Industries Calcutta EKC International (Tianjin) Co. Ltd. EKC Industries Next Gen Cylinder Compressions & FZE EKC Industries, Pvt. Ltd. Liquefaction (Thailand) (China) Dubai Branch Engineering Ltd. (Dubai, UAE) Company Ltd. (India) Ownershi
Slide 11: Manufacturing Facilities – India
Manufacturing Facilities – India Tarapur, Maharashtra, India Kandla SEZ, Gujarat, India • Manufactures a wide range of high pressure seamless • Manufactures small cylinders (1 litre to 21 litres), gas steel cylinders with storage capacity of up to 280 litres cylinders (up to 3000 litres), jumbo skid
Slide 12: Manufacturing Facilities – Overseas
Manufacturing Facilities – Overseas Plant I – Dubai Plant II – Dubai • Located at the renowned Jabel Ali Free Zone (North) in Dubai • Located at the renowned Jabel Ali Free Zone (South) in Dubai • Area: 21,000 sq m • Area: 25,000 sq m • Annual capacity: 120,000 cylinders • Annual capacity: 120,000 c
Slide 13: Extensive Range of Products
Extensive Range of Products CNG Steel Cylinders Medical Oxygen Industrial Cylinders Cylinders For Hydrogen Gases • Wide range of CNG cylinders • Safe, contamination-free • Wide range of industrial • Cylinders, quads and cascades designed and manufactured to cylinders storing gases such as cylinders
Slide 14: Extensive Range of Products
Extensive Range of Products Fire Extinguisher Body Jumbo Cylinders Breathing Air Cylinders Type 4 Composite Cylinders • Cylinders for storage of carbon • Large Capacity Jumbo Large • Compressed breathing air • Type 4 composite cylinders dioxide – used in fire capacity cylinders conforming cylinders
Slide 15: Manufacturing Process
Manufacturing Process Seamless Heat Hardness Painting Tubes Treatment Checking Neck Final Product Tube Cutting Neck Drilling Stamping Threading Inside Bottom Ultrasonic Int. & Ext. Neck Forming Milling Testing Shot Blasting Bottom Bottom Hydro stretch Air leakage forming Forming testing testing 14
Slide 16: Global Quality Certifications
Global Quality Certifications India USA UAE ISO 9001:2015 Certificate from American Society for Canadian Standards US Department of Manufacturing License of Bureau Veritas for High Pressure Transport Canada Mechanicals Engineers Association Transportation Special Equipment (China) seamless steel gas
Slide 17: Industry Overview
Industry = is a cD) > 6
Slide 18: CNG Demand Outlook
CNG Demand Outlook CNG Stations CNG Vehicles (mn) 3.6 2,000 3.1 1,500 Currently India’s CNG ecosystem is confined to just three states India Maharashtra, Gujarat India Maharashtra, Gujarat and Delhi and Delhi CNG Stations CNG Demand (mmscmd) 11,000 57 City gas distribution set to expand significantl
Slide 19: CNG Demand Outlook
CNG Demand Outlook Auto manufacturers planning to stop production BS-VI transition of diesel vehicles based on rising costs Policy to be finalized soon, expected to drive Vehicle Scrappage Policy new vehicle sales and CNG adoption Government urging state transportation CNG conversion of diesel buses
Slide 20: Industrial Demand Outlook
Industrial Demand Outlook Demand is driven by expansion in industrial production – Gross Fixed Capital Formation (GFCF) expected to rebound after the recent weakness Gross Fixed Capital Formation GVA from Industrial Sector (Current Prices) CAGR: 6% CAGR: 12% CAGR: 10% CAGR: 10% 55.7 49.0 37.1 43.4 3
Slide 21: Industrial Demand Outlook
Industrial Demand Outlook Fire Equipment and Fire Suppression Systems Supply to Medical Establishments • The global fire safety equipment market is estimated at $ 58 • Medical gas supply systems in hospitals and other healthcare billion in 2018 – and expected to expand at CAGR of 8.8% from facilitie
Slide 22: Industrial Demand Outlook
Industrial Demand Outlook Aerospace and Defense Speciality Gases • The Global Aerospace and Defence Industry has been growing on the • Growing number of gas applications in non-traditional areas such as back of rising commercial aircraft production and strong defence space research, food preservatio
Slide 23: Key Attributes
Key Attributes
Slide 24: Strengths
Strengths Sustained Established Large Capacity Wide Range of Leadership in Experienced Global High Quality Production and Wide Established the Indian Management Presence Products Infrastructure Product Range Relationships Market Large, multi- Compliance with Global scale Unique ability and Eminent c
Slide 25: Growth Drivers
Growth Drivers Diversified Customer Mix Environmental Favorable Concerns Operating High Barriers to Environment Customer base Entry Government consists of domestic Policy Support CNG has a higher- and international Robust octane rating over automobile OEMs, Demand Continued regulatory gasoline, CNG
Slide 26: International Operations
International Operations • Deals in CNG cylinders, industrial cylinders, cascades, multiple element gas containers, specialized fire suppression systems and fire detection/alarm systems • Targets markets include the Middle East, South America, Eastern and Western Europe Need pic Dubai • Received app
Slide 27: Consolidated Financial Performance
Consolidated Financial Performance
Slide 28: Management Commentary
Management Commentary “FY20 was another significant milestone for EKC, we continued to make steady business progress in the backdrop of weak economic conditions that impacted overall industrial activity. During the year, our domestic business grew its revenues by utilizing existing facilities while
Slide 29: Key Performance Highlights – Q4 FY20
Key Performance Highlights – Q4 FY20 Revenues 6.1% Rs. 198.6 Cr Revenue Break-up (Rs. Cr) Others 8.5 USA & Hungary EBITDA 47.2% Rs. 23.9 Cr 22.7 UAE 28.7 PBT* * Rs. 6.1 Cr India 147.5 PAT** ** (-) Rs. 0.8 Cr * PBT before exceptional items and tax from continuing operations was at (-) Rs. 0.1 crore i
Slide 30: Financial Summary – Q4 FY20
Financial Summary – Q4 FY20 Revenue ( Rs. Cr ) EBITDA (Rs. Cr) Margin (%) PBT (Rs cr) Margins (%) 12.0% 198.7 3.1% 187.3 8.7% 6.1 -0.1% 16.2 23.9 -0.1 Q4 FY19 Q4 FY20 Q4 FY19 Q4 FY20 Q4 FY19 Q4 FY20 Growth momentum continued in Margin expansion based on PBT expansion delivered Indian operations desp
Slide 31: Key Performance Highlights – FY20
Key Performance Highlights – FY20 Revenues 8.3% Rs. 760.5 Cr Revenue Break-up (Rs. Cr) Others 23.6 USA & EBITDA 4.6% Rs. 96 Cr Hungary 127.3 India PBT* (24.6%) Rs. 23.5 Cr UAE 501.6 136.0 PAT** (90.8%) Rs. 6.7 Cr *PBT before exceptional items and tax from continuing operations ** PAT during FY19 inc
Slide 32: Financial Summary – FY20
Financial Summary – FY20 Revenue EBITDA (Rs. Cr) Margin (%) PBT (Rs cr) Margins (%) 760.5 702.1 13.0% 4.4% 12.6% 3.1% 91.8 96.0 31.2 23.5 FY19 FY20 FY19 FY20 FY19 FY20 Revenue expansion achieved Profit margin has remained in PBT decline attributed to in the backdrop of slow the range despite increas
Slide 33: Revenue Growth
Revenue Growth Revenue* (INR Rs. Crore) 760.5 702.1 588.7 542.5 472.3 505.8 FY15 FY16 FY17 FY18 FY19 FY20 India UAE USA & Hungary 187.7 180.5 462.0 501.6 167.7 149.1 136 131.4 132.0 117.9 127.3 333.4 113.1 273.1 94.1 180.0 169.2 60.2 FY15 FY16 FY17 FY18 FY19 FY20 FY15 FY16 FY17 FY18 FY19 FY20 FY15 F
Slide 34: Profit Margin
Profit Margin Gross Profit (Cons) Gross Margin EBITDA EBITDA Margin PAT PAT Margin 53.9% 13.4% 48.3% 48.2% 10.4% 44.8% 43.6% 44.7% 14.4% 5.0% 13.1% 12.6% 0.9% 11.4% 78.7 27.2 73.0 6.7 -97.7 -124.1 0.6% 2.3% 211.5 220.3 284.2 292.7 338.1 340.2 2.6 11.8 64.6 77.8 91.7 96.0 -20.7% -24.5% FY15 FY16 FY17
Slide 35: Consolidated Balance Sheet
Consolidated Balance Sheet Assets ( Rs. Cr) 2017 2018 2019 2020 Liabilities ( Rs. Cr) 2017 2018 2019 2020 Fixed Assets 437.3 348.9 347.6 364.9 Shareholder Equity 421.9 444.1 517.8 537.7 Other Non-Current Assets 9.8 17.5 8.5 22.5 Long Term Debt 199.7 184.5 88.6 52.6 Deferred Tax Assets (net) 0.6 0.4
Slide 36: Ratios
Ratios Net Debt/Equity Net Debt/EBITDA Interest Coverage 7.5 1.7 1.5 1.5 1.3 4.5 0.8 3.3 0.8 0.6 2.1 0.4 FY17 FY18 FY19 FY20 FY17 FY18 FY19 FY20 FY17 FY18 FY19 FY20 Assets Turnover Working Capital Days 284 1.7 1.6 1.2 193 178 1.1 138 FY17 FY18 FY19 FY20 FY17 FY18 FY19 FY20 35
Slide 37: Corporate Summary
Corporate Summary • Auto manufacturers expanding CNG production based on superior buyer economics Strong Macro • PNGRB auctions mandate time-bound nationwide expansion of CNG ecosystem Framework • Medical oxygen demand expected to drive secular growth as India invests in healthcare • Industrial dema
Slide 38: About Us
About Us Everest Kanto Cylinder Limited (EKC) (BSE: 532684, NSE: EKC), established in 1978, is a clean energy solutions company and a leading global manufacturer of seamless steel gas cylinders with over 30 million industrial gas and CNG cylinders currently in service. Contact Us: EKC operates two m
Slide 39: Thank You
ERC The Fastest Growing Cylinder Manufacturer Since 1978 Thank You
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