Tribhovandas Bhimji Zaveri Limited · NSE:TBZ
Tribhovandas Bhimji Zaveri — Q2 FY20 Earnings Presentation
33 slides from Tribhovandas Bhimji Zaveri's earnings presentation, Nov 8, 2019
Slide 1: Exchange cover letter for investor presentation
Date: 81h November, 2019 To, To, The Manager, The Manager, Compliance Department, Compliance Department, National Stock Exchange of India Limited BSE Limited Exchange Plaza, Plot No. C/1, Corporate Service Department, G Block, Bandra-Kurla Complex, Phiroze Jeejeebhoy Towers, Sandra (East), Mumbai- 4
Slide 2: Investor Presentation Q2 FY20 Results
INVESTOR PRESENTATION Q2 FY20 RESULTS NOVEMBER 2019
Slide 3: Disclaimer
DISCLAIMER This presentation has been prepared by Tribhovandas Bhimji Zaveri Limited (“TBZ”) for informational purposes only and does not constitute or form any part of any offer, invitation or recommendation to purchase or subscribe for any securities in any jurisdiction, and no part of it shall fo
Slide 4: Discussion Summary
DISCUSSION SUMMARY • Q2 FY20 Results Update • About Us • Operational Summary • Business Model
Slide 5: Q2 FY20 Result Highlights
Q2 FY20 RESULT HIGHLIGHTS In Rs Mn REVENUES & GROSS MARGIN EBITDA & EBITDA MARGIN PAT & PAT MARGIN 15.3% 13.9% 4.6% 5.5% 0.5% 0.2% 217 3,457 3,932 158 17 9 Q2 FY19 Q2 FY20 Q2 FY19 Q2 FY20 Q2 FY19 Q2 FY20 OPERATING COSTS (% of Total Revenue) REVENUE ANALYSIS Total Revenue Growth % 13.7% - Q2 FY20 Q2
Slide 6: H1 FY20 Result Highlights
H1 FY20 RESULT HIGHLIGHTS In Rs Mn REVENUES * & GROSS MARGIN EBITDA & EBITDA MARGIN PAT & PAT MARGIN 15.1% 14.6% 5.8% 3.9% 0.4% 0.5% 8,230 474 7,566 297 39 30 H1 FY19 H1 FY20 H1 FY19 H1 FY20 H1 FY19 H1 FY20 OPERATING COSTS (% of Total Revenue) REVENUE ANALYSIS Total Revenue Growth % 8.8% - H1 FY20 H
Slide 7: Q2 FY20 Balance Sheet Update
Q2 FY20 BALANCE SHEET UPDATE In Rs Mn LEVERAGE ANALYSIS TOTAL DEBT BREAKUP 1.14 1.06 6,054 5,558 5,657 4,941 4,821 5,105 3,000 1,828 3,054 3,730 Mar-19 Sept-19 Mar-19 Sept-19 Equity Net Debt Net Debt/Equity Working Capital Debt Gold on Loan Notes: 1) Gold on Loan is shown as part of short term borro
Slide 8: Q2 FY20 - Key Result Takeaways
Q2 FY20 - KEY RESULT TAKEAWAYS REVENUE & MARGIN: • Revenue for Q2 FY20 Increased by 13.7% YoY mainly due to higher sales of diamond jewellery (25.2% versus 20.7%) • Gross Profit Margins for Q2 FY20 were lower on account of promotional/tactical offers. • Finance cost shows increase due to impact of I
Slide 9: Impact of IND AS 116
Impact of IND AS 116 IND AS 116 (Accounting for leases) was mandated from 1st April 2019 This Ind-AS has the following impact: 1) On Profit & Loss: Lease Rental expenses is replaced by Depreciation and Interest Expenses. 2) On Balance sheet: The Accounting Standard essentially brings all the leases
Slide 10: Brand Building & Marketing Initiatives
BRAND BUILDING & MARKETING INITIATIVES • TBZ has been making consistent investments in its marketing activities to widen its customer base and promote the brand in India • Recently TBZ appointed Bollywood actress Sara Ali Khan as new brand ambassador • Sara Ali Khan will feature in several brand cam
Slide 11: New Launches & Collection
NEW LAUNCHES & COLLECTION DIVYA” thyz Channel your inner goddess th; Teiniiovanpas Bitingt ZAVERI YELLOW DIAMOND JEWELLERY by (hz, 10
Slide 12: Latest Jewellery Designs & Collections
LATEST JEWELLERY DESIGNS & COLLECTIONS 11
Slide 13: Contemporary Jewellery Designs & Collections
CONTEMPORARY JEWELLERY DESIGNS & COLLECTIONS 12
Slide 14: Contemporary Jewellery Designs & Collections
CONTEMPORARY JEWELLERY DESIGNS & COLLECTIONS 13
Slide 15: Contemporary Jewellery Designs & Collections
CONTEMPORARY JEWELLERY DESIGNS & COLLECTIONS 14
Slide 16: Contemporary Jewellery Designs & Collections
CONTEMPORARY JEWELLERY DESIGNS & COLLECTIONS 15
Slide 17: Q2 FY20 - Profit & Loss Statement
Q2 FY20 - PROFIT & LOSS STATEMENT Particulars (In Rs Mn) – Q2 FY20 Q2 FY19 YoY % H1 FY20 H1 FY19 YOY % FY19 Standalone Net Revenues 3,932 3,457 13.7% 8,230 7,566 8.8% 17,638 COGS 3,387 2,925 15.7 7,026 6,422 9.4% 15,149 Gross Profit 545 531 2.55 1,204 1,144 5.3% 2,489 Gross Margin (%) 13.9% 15.4% -1
Slide 18: Q2 FY20 - Balance Sheet
Q2 FY20- BALANCE SHEET Particulars (In Rs Mn) – Standalone Sept-19 June-19 March-19 Shareholders Funds (refer slide 8) 4,821 4,878 4,941 Loan Funds 5,558 5,953 6,054 Gold on Loan 1,828 2,853 3,000 Working Capital Loan 3,730 3,100 3,054 Lease Liability 589 635 - Other Long Term Liabilities 64 358 77
Slide 19: Discussion Summary
DISCUSSION SUMMARY • Q2 FY20 Results Update • About Us • Operational Summary • Business Model
Slide 20: Why is TBZ Different?
WHY IS TBZ DIFFERENT ? Pedigree Strong Brand Value • 150+ years in jewellery business • Healthy sales productivity • First jeweller to offer buyback guarantee in • High footfalls conversion - 80% 1938 • High ticket size - Gold – Rs 89 k, Diamond – • Professional organisation spearheaded by Rs 103 k
Slide 21: Key Milestones
KEY MILESTONES STRONG LEGACY OF MORE THAN 150 YEARS BUILT ON TRUST Retail footprint Flagship store Introduced 100% pre- Diamond facility crosses 84k sq ft 2nd Franchise opened in Zaveri hallmarked jewellery expansion - ~6k to 1st Franchise across 20 cities store opened at Bazaar, Mumbai ~24k sq ft s
Slide 22: Retail Presence
RETAIL PRESENCE PAN-INDIA PRESENCE WITH 41 STORES WITH A RETAIL SPACE OF ~120,595 SQ. FT. SPREAD ACROSS Present across 29 cities 29 CITIES IN 14 STATES in 14 states NUMBER OF STORES TILL DATE Large Format (> 2,000 sq. ft.) 31 Small Format (<= 2,000 sq. ft.) 10 Total Stores 41 Total Area ~120,595 21
Slide 23: Retail Footprint Expansion
RETAIL FOOTPRINT EXPANSION 1,20,699 1,10,666 1,02,930 98,200 41 91,058 88,093 37 82,368 32 30 27 28 25 FY13 FY14 FY15 FY16 FY17 FY18 FY19 No. of Retail Outlets Carpet Area (sq. ft.) 22
Slide 24: Discussion Summary
DISCUSSION SUMMARY • Q2 FY20 Results Update • About Us • Operational Summary • Business Model
Slide 25: Operational Summary
OPERATIONAL SUMMARY GOLD & DIAMOND VOLUMES 52,010 45,111 44,913 39,958 40,762 4,706 4,216 3,931 4,027 3,738 FY15 FY16 FY17 FY18 FY19 Gold Sales (kgs) Diamond Sales (cts) SSSG - TOTAL (%) AVERAGE TICKET SIZE (RS ‘000) 139 122 129 4.0 115 0.1 103 85 91 89 73 80 -2.1 -0.4 -16.5 FY15 FY16 FY17 FY18 FY19
Slide 26: Discussion Summary
DISCUSSION SUMMARY • Q2 FY20 Results Update • About Us • Operational Summary • Business Model
Slide 27: Business Model: Manufacturing (Gold)
BUSINESS MODEL: MANUFACTURING Gold PROCUREMENT • Raw Material - Bullion Sources: • Exchange & purchase of old jewellery • Bullion dealers • Banks - imported gold • Banks - domestic gold (gold deposits) on loan • Gold jewellery manufacturing is outsourced. • Vast nation-wide network of 150 vendors •
Slide 28: Business Model: Manufacturing (Diamond)
BUSINESS MODEL: MANUFACTURING Diamond PROCUREMENT • Raw Material - Cut & polished diamonds Sources: • DTC site holders • In-house diamond jewellery manufacturing leading to exclusive designs, lower costs, and higher margins • Manufacturing facility at Kandivali, Mumbai spread over ~24,000 sq ft with
Slide 29: Business Model: Retail
BUSINESS MODEL: RETAIL EFFICIENT INVENTORY MANAGEMENT HUB & SPOKE MODEL - ROI OPTIMISATION SMALL STORES • <= 2,000 sq ft SMALL • Across the city STORE • Smaller range • Lower price points (up to Rs 500k) SMALL SMALL LARGE STORES LARGE FORMAT STORE STORE STORE • > 2,000 sq ft • Standalone high street
Slide 30: Business Model: Scalability
BUSINESS MODEL: SCALABILITY • TBZ has an expansion plan to increase its retail space from 120,595 sq. ft. at present to around 1,50,000 sq. ft. over near term. • TBZ plans to carry out the expansion through mix of franchisee route and addition of its own stores. • All the prospective expansion locat
Slide 31: Gold Metal Loan: Efficient Sourcing Channel
GOLD METAL LOAN: EFFICENT SOURCING CHANNEL GOLD METAL LOAN ORIGINATION GOLD METAL LOAN REPAYMENT • TBZ takes 10 kg gold from a bank on lease on day 0. • TBZ repays the gold daily based on actual sales of gold • The contract for gold lease is 180 days. jewellery. • TBZ provides a bank guarantee worth
Slide 32: Awards & Recognition
AWARDS & RECOGNITION • “CONTEMPORARY DIAMOND JEWELLERY AWARD” & “TREASURE OF THE OCEAN “ GJC’S NATIONAL JEWELLERY AWARD 2018 • “DIAMOND VIVAH JEWELLERY OF THE YEAR” Retail Jeweller India Awards - 2018 • “INDIA’S MOST PREFERRED JEWELLERY BRAND” UBM India - 2017 • “BEST RING DESIGN OVER Rs. 2,50,000”
Slide 33: Contact Details
Saurav Banerjee Manasi Bodas / Chintan Mehta Chief Financial Officer IR Consultant Tribhovandas Bhimji Zaveri Limited Dickenson +91 022 30735000 +91 9821043510 /9892183389 saurav.banerjee@tbzoriginal.com tbz@dickensonworld.om 32
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