Slide 1: Exchange submission letter for investor presentation
Date:16th November 2022 BSE Limited (BSE) National Stock Exchange of India Limited (NSE) Department of Corporate services Exchange Plaza, Phirojee Jeejeebhoy Towers Plot no. C/1, G Block, Dalal Street, Mumbai – 400023 Bandra-Kurla Complex, Bandra (E), Mumbai – 400051 Scrip Code: 500136 Symbol: ESTER
Slide 2: Investor Presentation November 2022
estor Presentation JSTRIES LTD. November, 2022
Slide 3: Forward-looking statements disclaimer
Certain statements in this document may be forward-looking statements. Such forward-looking statements are subject to certain risks and uncertainties like government actions, local political or economic developments, technological risks, and many other factors that could cause actual results to diff
Slide 4: About Us, Q2 & H1 FY23 Performance, Ester 2.0
About Us Q2 & H1 FY23 Performance Ester 2.0 Investment Thesis Business Overview 3
Slide 5: Business Overview
Sales Mix (H1 FY23) Diversified business portfolio Comprehensive product suite Polyester Films 65% State-of-the-art manufacturing facilities Specialty Global footprint Polymers 17% Experienced management team Strong Financial profile *Engineering Plastics 18% * Financial results of EP Business repor
Slide 6: Company key facts
1985 GURGAON, INDIA #2 Year of Incorporation Corporate Headquarters Business Segments* 445 – KHATIMA, About 50 COUNTRIES SITARGANJ, CRISIL A GURGAON (stable outlook) 135 - HYDERABAD Global Footprint People Credit Rating (Long Term) * PF - Polyester Film; SP - Specialty Polymers; EP - Engineering Pla
Slide 7: Locations: Sitarganj, Khatima, Gurgaon
Sitarganj Haryana Uttarakhand Gurgaon Khatima Telangana* Corporate Headquarter Manufacturing facility *New BOPET Film plant under implementation Commercial production expected by December 22 6
Slide 8: We serve about 50 Countries
Global Pr We serve about 50 Countries : :
Slide 9: 8
8
Slide 10: Q2 & H1 FY23 financial performance
Particulars – Continued Operations (Rs.cr) Q2 Q2 % H1 H1 % Higher off-take in Specialty FY23 FY22 FY23 FY22 Polymers with favorable product – mix and higher per unit realization Revenues 304.22 258.78 17.6% 628.51 518.7 21.2% in Polyester Film consequent to EBITDA (including Non operating income)
Slide 11: Chairman's commentary on performance
Commenting on the performance, Mr. Arvind Singhania, Chairman, Ester Industries said: “We have had a good first half wherein both Films and Specialty Polymers reported good volume of sales resulting in higher revenue growth. Specialty Polymer business has had a stellar run with Q2 registering highes
Slide 12: Ester 2.0
ESTER INDUSTRIES LTD. Ester 2.0 Company “Specialty
Slide 13: Ester 2.0: Knowledge, Innovation, Customization, Technology
Knowledge Innovation ESTER Customization 2.0 Technology 12
Slide 14: Ester 1.0 Achievements and Ester 2.0
Achievements Ester 2.0 Ester 1.0 Commoditized product Specialty Polymer SBU Revenues portfolio o Largely patent protected (FY12-FY16) (FY17-FY22) – high entry barriers Limited bargaining power 2.4% CAGR 14.7% CAGR o High sustainable margins Low and unpredictable EBITDA margins o High growth
Slide 15: Revenues, EBITDA, EBITDA Margins, PAT
Revenues (Rs.cr) EBITDA (Rs.cr) 1,405 236 243 1,028 1,039 992 189 886 928 896 771 700 707 824 108 74 71 70 66 35 41 42 FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19FY20 FY21 FY22 FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19FY20 FY21 FY22 EBITDA Margins (%) * Decline due to higher denominator effect PAT (Rs.cr)
Slide 16: Debt, ROCE, Dividend Payout
Debt (Rs.cr) ROCE (%) 335 363 348 31% 304 300 290 28% 242 267 26% 237 142 157 14% 8% 7% 7% 7% 3% 3% 3% FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19FY20 FY21 FY22 FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19FY20 FY21 FY22 Dividend Payout (%) 37% 21% 20% 20% 13% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% FY12 FY13 FY14 FY15
Slide 17: Shareholding pattern
34.23 35.62 35.57 35.70 % % % % Mar 21 Mar 22 Jun 22 Sep 22 64.04 64.04 64.04 64.04 1.73% % 0.34% % 0.39% % 0.26% % 16
Slide 18: Investment thesis
Specialty Polymers - Polyester Films - High Largely IP protected share of value added product portfolio products Rewarding shareholders with Scaling up capacities dividend Strong balance sheet 17
Slide 19: Green Initiatives Focus On Sustainability
Green Initiatives Focus On Sustainability BIO-BASED Fuel Consumption oo $ PVC FREE fe oa wist Wrap / Shrink Film) BIO-BASED Raw Material me Pvec FREE PAC (Transparent High B Ss PACKAGING MATERIA Reduction/ Recycling y \3 IL REPLACEMENT & lized High Barrier film) ® w=
Slide 20: Specialty Polymer
Se 4 q ESTER INDUSTRIES LTD. Specialty Polymer
Slide 21: Largely IP protected business
Customer High entry retention Largely IP High barriers – ensured as Marquee Export protected margin patent largely clientele oriented business business protected patent protected
Slide 22: Business Opportunity: stain resistant carpets
Problem Solution Business Opportunity USA, largest High cost towards carpet stain Flexible low cost solution producer of Carpets removal Ester has developed a PET based & Rugs boasts of an industry with Stain marks on (nylon) carpets given master batch, which imparts permanent spillover / spilla
Slide 23: Innovative PBT supply agreement
Regularly manufacturing & supplying Innovative Signed ‘Manufacture and Supply Agreement’ with a Polybutylene Terephthalate (PBT) polymers to a global global chemical leader in April 2019 effective 1st April chemical leader 2019 for 2 years for 400 MT per annum Ester Industries is among the only comp
Slide 24: Applications
Consumer electronics Polyethylene Terephthalate (PET) Textile – Flame Retardant, Deep dyeable master batches, Cationic dyeable master batch Applications Products Polybutylene Terephthalate (PBT) Carpets – Stain Resistant Master Batches Carpets – Deep Dyeable Master Batch Polyethylene Naphthalate (PE
Slide 25: Specialty Polymers Q2 FY23 performance
Figs. in cr Q2 Q2 H1 H1 Particulars FY23 FY22 % FY23 FY22 % Volumes (MT) Sales Q2FY22 Q2FY23 1,248 884 41.1 2,330 1,745 33.5 (Vol's MT) Revenue 72 46 56.5 130 81 60.5 284 EBIT 23 17 35.3 41 30 36.7 Innovative PBT 605 Margins (%) 31.9 36.9 (500 bps) 31.5 37.0 (550 bps) Higher product off-take coupl
Slide 26: Packaging Film Business
ESTER INDUSTRIES LTD. Packaging Film Business 25
Slide 27: Global and domestic BOPET scenario
Global Scenario: Domestic Scenario: Demand growth of 6% - 6.5% Strong double digit growth rate of 11%-13% pa over BOPET film used in flexible packaging applications past 5 years will continue to be the key end use sector, Low per capita consumption of BOPET; new accounting for nearly 60% of
Slide 28: Film business capacities and key facts
60,000 13,200 #34+ MTPA MTPA Years of experience Polyester Film Mfg. capacity Metallized Polyester Film Mfg. capacity 67,000 48,000 50 23% MTPA MTPA* Export market Share of value-added Polyethylene Terephthalate BOPET Film Capacity (# of countries) products (Q2 FY23) (Polyester) chips Mfg. expansion
Slide 29: Value added share and film EBIT
Value Added (%) *Film business (excl. chips) Domestic Exports (Rs.cr) FY19 FY20 FY21 FY22 20 22 17 17 EBIT 118 180 219 150 30 23 29 30 Margins 16.4 24.5 31.9 17.8 70 77 71 70 (%) FY19 FY20 FY21 FY22 FY19 FY20 FY21 FY22 Product mix – despite reduction Pass through business model – in recent past, aim
Slide 30: Applications
White Opaque High Clear Flexible Packaging Applications High Barrier Embossable Barrier Packaging Products Heat Saleable Twist Wrap Embossing Shrink film Anti - Static Lidding Metalized High Matte Label & Graphics Barrier 29
Slide 31: Film business Q2 FY23 performance
Figs. in cr Particulars Q2FY23 Q2FY22 % H1 FY23 H1 FY22 % Sales (Vol’s MT) 14,885 14,591 2.0 29,698 29,874 (0.6) Revenue* 232 213 8.9 498 438 +13.7 EBIT+ 14 28 (50.0) 67 64 +4.7 Margins (%) 6.1 13.1 (700 bps) 13.5 14.6 (110 bps) *Revenue includes chip sales worth Rs. 6.80 cr (Q2 FY23) ; Rs. 18.28 cr
Slide 32: New BOPET plant in Hyderabad, Telangana
Location: Hyderabad, Telangana Project being implemented by Wholly Owned Subsidiary of Ester Industries Limited in the name of Ester Filmtech Limited Project cost: Rs. 646.03 crores including margin money for working capital and GST accumulation Sources of Funds: Equity from Parent Company
Slide 33: Engineering Plastics
Engineering Plastics
Slide 34: Engineering Plastics discontinued operations
Figs. in cr EP SBU - Discontinued Operations Q2 FY23 Q2 FY22 % H1 FY23 H1 FY22 % • Lower volume off-take resulted in revenue moderation for the quarter Revenue from Operations 58.36 74.23 (21.4%) 136.01 133.23 2.1% and first half Profit before Tax 7.02 17.57 (60.0%) 17.68 39.54 (55.3%) • EBIT and ma
Slide 35: Divestment of EP SBU to Radici Plastics
Conditions as stipulated in Business Transfer Agreement dated 6th May 2022 were complied with by end of August 2022 and the EP SBU was transferred to Radici Plastics India Private Limited on 15th September 2022 Divestment of EP SBU at the right time as margins that peaked in June 21 have come ba
Slide 36: About Us and contact details
About Us: (CIN :- L24111UR1985PLC015063) Incorporated in 1985, Ester Industries Limited (EIL) is an ISO 9001:2008,ISO 22000:2005,TS16949:2002 certified Company engaged in the manufacture of polyester films, specialty polymers and polyester chips with manufacturing facilities located in Khatima (Utta
Slide 37: Thank You
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