Coromandel International Limited · NSE:COROMANDEL
Coromandel International — Investor Presentation (July 2012)
58 slides from Coromandel International's investor presentation, July 2012
Slide 1: Investors Presentation
July, 2012 Investors Presentation (Updated with Quantitative details for 2011-12) 1
Slide 2: Disclaimer
Disclaimer This presentation contains forward-looking statements which may be identified by their use of words contains “plans,” “expects,” “will,” “anticipates,” “believes,” “intends,” “projects,” “estimates” or other words of similar meaning. All statements that address expectations or projections
Slide 3: Contents
Contents Company CompanyProfile Profile 44 Fertiliser Fertiliser 7-23 7-23 SND SND 24-28 24-28 Crop Cropprotection protection 29-36 29-36 Retail Retail 37-40 37-40 Financial FinancialPerformance Performance 41-54 41-54 Awards Awardsand andAccolades Accolades 55-57 55-57 3
Slide 4: Company Snapshot
Company Snapshot Coromandel Coromandel Share Sharein in • Coromandel International Limited, Murugappa MurugappaGroup Group established in 1961 is the flagship Turnover company of the INR 22,314 Crores Murugappa group • Coromandel is India’s second largest producer of Phosphatic Fertilizers EBITDA •
Slide 5: Business Structure
Business Structure Sales EBITDA Phosphatic Phosphatic DAP DAP Fertilisers Fertilisers Complex Fertilisers /SSP/MOP Complex Fertilisers /SSP/MOP 90% 70% G-Sulphur Specialty Specialty G-Sulphur Water Soluble Fertilisers Nutrients Nutrients&& Water Soluble Fertilisers Coromandel Coromandel Compost Orga
Slide 6: Strategic Direction
Strategic Direction Farm Farm Inputs Inputs Business Business Dominance Dominance in in Fertilisers Fertilisers Non Non Subsidy Subsidy Businesses Businesses Sourcing Sourcing Cost Cost Marketing Marketing Leadership Leadership Strength Strength • Specialty Nutrients/ Water Strategic Alliances in •
Slide 7: Coromandel’s Fertiliser Business
Coromandel’s Fertiliser Business 7
Slide 8: Coromandel Fertiliser Business Growth Story
Coromandel Fertiliser Business Growth Story C Train Expansion SSP Plant in Bhatinda 42 Lac Mt 8
Slide 9: Global Strategic Alliances
Global Strategic Alliances Pact with QAFCO for supply of Urea and Ammonia 9
Slide 10: State of The Art Manufacturing Facilities
State of The Art Manufacturing Facilities • Plants are strategically located in highly • High capacity utilisation levels & irrigated southern Indian states and in continuous modernisation of facilities heart of fertilizer consumption market – • Backward integration into low freight cost manufacturi
Slide 11: Cost Leadership
Cost Leadership Visak Production (Million Mt) Visak VisakPlant Plant Captive Phos Acid • Continuous de-bottle necking to increase production levels • Value gap - imported Vs own acid • Increased Gypsum generation • Use of various sources /grades of rocks • New belt filter technology- to use low grad
Slide 12: Marketing Network
Marketing Network Uttar Pradesh (UP) West Bengal (WB) Company Company Bihar Orissa (OR) Andhra Pradesh (A.P) Karnataka (KN) Maharashtra (MH) Madhya Pradesh (MP) & Chattisgarh Wholesaler Wholesaler //Distributor Distributor Tamil Nadu (TN) PDO PDO Semi Semi Wholesaler / Wholesaler / Dealer Dealer Vis
Slide 13: Business Update – June’12
Coromandel = BUSINESS UPDATE - J UNE’12 Ne murugappa 7 _ _ 7 _ _ -_ — 13
Slide 14: Fertilisers – Indian Scenario
Fertilisers – Indian Scenario • India continues to remain one of the key drivers of growth of fertiliser demand in the World. Agriculture expected to grow at 3.5‐4% in FY11‐12 with record food production of over 252.5 Mn MT in 2011‐12 (245 Mn MT 2010‐11) Sales – lac Mt Import – lac Mt Production – l
Slide 15: Coromandel FY12 Production / Imports / Sales
Coromandel FY12 Production / Imports / Sales YoY Lac MT 2010‐11 2011‐12 Growth Production DAP 4.34 3.62 ‐17% Complex 21.04 19.72 ‐6% SSP 1.04 1.07 3% Total 26.43 24.42 ‐8% Sales of Imported Finished Goods DAP 0.99 1.60 62% Complex 0 2.33 Nm MOP 1.63 1.46 ‐11% Urea 1.98 2.87 44% Total ‐ A 4.60 8.26 8
Slide 16: International Raw Material Price Movement
International Raw Material Price Movement Phos Acid - finalized @ 885 $ per Mt for 1st Qtr Ammonia– Firming Up Urea– Prices continue to rule high DAP– contracted @ 580 $ per Mt 16
Slide 17: Current Scenario
Current Scenario • International prices of DAP are stable‐ currently around 580$. Indian buyer’s have contracted DAP @ 580 USD/Mt • Phos acid price – finalized @ 885 $ per mt for 1st and 2nd Qtr • Ammonia /Urea prices continue to rule high • As per IMD, there will be 96 per cent (normal Monsoon) of
Slide 18: NBS rates
NBS rates • NBS policy for P&K fertilisers • Improved availability for farmers • Reduced subsidy outgo for the Govt Estd. Rs. 18,000 Cr for last 2 yrs • Input prices negotiated based on market condition • NBS rates for 2012-13 reduced in line with drop in international prices Subsidy - Rs. Per Kg Nu
Slide 19: MSP Trend
MSP Trend MSPs 2011‐12 2012‐13 % Change Paddy 1,080 1250 16% Maize 980 1175 20% Wheat 1120 1285 15% Cotton 2500 2800 12% Sugarcane 145 Not Decided na Green Gram 3,500 Not Decided na Urad 3,300 4300 30% Tur 3,200 Not Decided na Ground nut 2,700 3700 37% Seseamum 3,400 4200 24% Soya 1,650 2200 33% Sun
Slide 20: Project Update – C Train
Project Update – C Train • Progressing at brisk pace • Scheduled to be completed by Aug / Sep 2012 • Focus on unique grades • Project will be eligible for weighted tax deduction under section 35AD of Indian Income tax Act, 1961 60 meter Slab Ammonia Tanks 20
Slide 21: Project Update – TIFERT
Project Update – TIFERT Sulphuric Acid Plant TIFERT Project •Situation returning to Normal •Overall completion status 97.34% •Scheduled to be online by Aug/Sep’12 Phos Rock digestion section Phos Acid Plant – Concentration section 21
Slide 22: Project Update – SSP
Project Update – SSP SSP Bhatinda •Sulphur being tie up with HPCL Mittal Energy Limited refinery •Land is being finalized and activity will commence shortly •Plant will be commissioned in 2013‐14 22
Slide 23: Positive developments from finance bill 2012
Positive developments from finance bill 2012 Weighted deduction of 150% available under Section 35AD for fertilizer projects Import of manufacturing equipment for fertilisers exempted from custom duty for 3 years ‐ currently at 5% Withholding tax on ECBs for fertiliser sector reduced from 20%
Slide 24: Specialty Nutrient Business
Specialty Nutrient Business 24
Slide 25: Speciality Nutrients Division (SND)
SPECIALITY NUTRIENTS DIVISION (SND) G-SULPHUR Micronutrients Organic Compost WSF GROMOR GROMOR SULPHUR SULPHUR GROMOR Boron GROMOR SPRAY SPRAY Boron Zinc Zinc GROMOR GROMOR POWER POWER Sulphozinc Sulphozinc 25
Slide 26: Basics of Water Soluble Fertilisers
Basics of Water Soluble Fertilisers What How Howto touse useWater Watersoluble Whatis isWater Watersoluble solublefertilizers? fertilizers? soluble fertilizers? fertilizers? •100% water soluble •Available in double and multi nutrient •Foliar application combinations with or without secondary •Fertig
Slide 27: Sulphur and WSF Business
Sulphur and WSF Business SQM JV commissioned 2011 27
Slide 28: SND & Organic Manure Business
SND & Organic Manure Business Bentonite Sulfur Record turnover of Gromor Sulfur with y/y growth of 14%. Organic Compost Volumes (Mt) Continues to be the market leader despite adverse market conditions WSF New WSF plant under JV with SQM commenced operations SQM JV plant likely to be in full
Slide 29: Crop Protection Business
Crop Protection Business Coromandel (A
Slide 30: Crop Protection business
Crop Protection business • Wider range of Technicals 2011 (insecticides/fungicides/herbicides) • Increased Global presence and registration Sabero Acquisition 2010 ‐Open Offer process to • Strong distribution with own retail outlets get underway shortly Acquired Pasura Bio Tech – Jammu Unit 2009 II
Slide 31: Crop Protection business - Key Strengths
Crop Protection business- Key Strengths Regular introduction of new technicals to offset Endosulfan phase out Low cost manufacturer of technicals Leveraging Retail network (MGCs) to grow branded formulation business Continued specialty focus for improved profitability Exclusive import sour
Slide 32: Initiatives
Initiatives Operational OperationalInitiatives Initiatives Jammu Jammu • Expansion of technical plant capacity at Ankleshwar • Export to more countries & increase the reach • Focusing on high margin super specialities • Leveraging on retail network in AP & Accelerated growth plan in all states Strat
Slide 33: Business Update – June’12
Coromandel = BUSINESS UPDATE - J UNE’12 Ne murugappa 7 _ _ 7 _ _ -_ — 33
Slide 34: Crop Protection Business Highlights
Crop Protection Business Highlights • Global industry achieved a growth of 16% in nominal terms and 8% in real terms over previous year supported by higher commodity prices • Indian industry witnessed late onset of monsoon and record sowing of cotton during the year. But due to insufficient rains in
Slide 35: Update on Sabero Organics Gujarat Limited
Update on Sabero Organics Gujarat Limited Coromandel along with subsidiary Parry Chemicals currently holds 74.57% stake in Sabero Acquisition helped Coromandel to move to top 5 player in Agro chemical Industry Access to Global markets; Synergies in Latin America operation Expanded basket of
Slide 36: Update on Sabero Organics Gujarat Limited
Update on Sabero Organics Gujarat Limited Financials of Sabero affected in 11- (Rs. Cr) 10-11 11-12 Turnover 12 due to 413 361 EBITDA (before E/O Items) 41 (4) One time write offs/exchange E/O Items and FOREX (2) (34) EBITDA Reported 39 (38) difference % of TO 10-11 11-12 Fungicides 43% 45% Lo
Slide 37: Mana Gromor Centers (MGCs) - Retail
Mana Gromor Centers (MGCs) - Retail 37
Slide 38: Retail Business - Rationale
Retail Business - Rationale Viable Alternative • Develop Distribution Channel for Coromandel • Reduce Dependency on Distributors • Capture opportunities in Rural Areas Opportunities in Rural Areas • Providing Lifestyle Products at nearest Location • Supply Products and Solutions to improve earning c
Slide 39: Retail Business Overview
Retail Business Overview • Over 500 Mana Gromor Centers in Andhra Pradesh and 100 centers in Karnataka ‐ servicing close to 2 million farmers • Further expansion to Karnataka and Maharashtra soon • Targeting 1000 centers Providing “One Stop Solution” to the Indian Farmers 39
Slide 40: Performance Highlights - Retail
Performance Highlights - Retail 424 old stores in AP have completed 3 full years ‐ out of this 311 stores have turned profitable (compared to 229 for last year) Completed the rollout of 200 new stores in AP and Karnataka – Total stores as on date 640 Entered into supply arrangements for the la
Slide 41: Financial Performance
Financial Performance Consanandel
Slide 42: Financial highlights – FY12
Financial highlights – FY12 • Turnover for year ended March 2012 at Rs. 9,823 Cr against Rs. 7,639 Cr for last year ( y/y growth 29%) • EBITDA for the year at ‐ Rs. 1,015 Cr against Rs. 830 Cr for last year (y/y growth 22%) • PBT for the year before prior year subsidy and extra ordinary items ‐ Rs.
Slide 43: Financial Performance
Financial Performance Turnover Turnover((RS. RS.Cr) Cr) EBIDTA EBIDTA(Rs. (Rs.Cr) Cr)&&EBIDTA EBIDTA% % % Rs Cr PAT ROE ROE&&ROCE ROCE(%) PAT(Rs. (Rs.Cr) Cr) (%) 43
Slide 44: Income Statement
Income Statement Amount in Rs. Cr 2007 2008 2009 2010 2011 2012 Revenue 2,080 3,787 9,408 6,452 7,639 9,823 YoY (Growth) 82.09% 148.42% ‐31.42% 18.40% 28.59% EBITDA before PY Subsidy & EO Items 214 442 689 506 830 1,015 EBITDA % 10.27% 11.68% 7.32% 7.85% 10.86% 10.34% PY Subsidy ‐ ‐ ‐ 262 227 46 EBI
Slide 45: Balance sheet
Balance sheet Amount in Rs. Cr 2007 2008 2009 2010 2011 2012 Equity 512 794 1,127 1,435 1,904 2,371 Debt & Other LT liabilities 549 1,043 1,720 1,918 1,471 2,468 Deferred Tax Liability 71 83 80 86 82 68 Sources of Funds 1,133 1,920 2,927 3,438 3,457 4,907 NFA 382 735 792 817 853 940 Investments 174
Slide 46: Quantitative Details 2011-12 (a) Materials consumed
Quantitative Details 2011-12 (a) Materials consumed (Incl. packing material) Amount in Rs. Particulars Amt in Rs. Particulars Qty in MT Lacs Lacs Ammonia 441,316 118,418 Packing Material 12,206 Rock Phosphate 719,621 67,920 Sulphuric Acid 19,067 Urea 128,671 30,242 Others 2,104 Sulphur 256,988 28,40
Slide 47: Quantitative Details 2011-12 (b) purchase of stock-in-trade
Quantitative Details 2011-12 (b) purchase of stock-in-trade Particulars Qty in MT Amount in Rs. Lacs Di‐ Ammonium Phosphate ( DAP) 166,368 54,269 Ammonium phosphatic fertilisers 278,000 60,388 Muriate of Potash 169,526 42,836 UREA 287,728 15,030 Ammonia 8,743 2,580 Plant Protection Chemicals ‐ 7,430
Slide 48: Quantitative Details 2011-12 (c)(i) Sales - Manufactured Products
Quantitative Details 2011-12 (c )(i)Sales - Manufactured Products * Particulars Qty in MT Amount in Rs. Lacs Di‐ Ammonium Phosphate (DAP) 334,331 50,203 Ammonium phosphatic fertilisers 2,025,708 259,430 Single superphosphate 117,995 5,158 Plant protection chemicals ‐ 41,507 Others ‐ 23,961 Total 380
Slide 49: Quantitative Details 2011-12 (c)(ii) Sales - Stock-in-trade
Quantitative Details 2011-12 (c )(ii)Sales - Stock-in-trade Particulars Qty in MT Amount in Rs. Lacs Di‐ Ammonium Phosphate (DAP) 160,443 26,193 Ammonium phosphatic fertilisers 232,599 28,440 Muriate of potash 145,723 15,715 Urea 287,099 14,967 Ammonia 8,743 2,868 Plant protection chemicals ‐ 7,477
Slide 50: Quantitative Details 2011-12 (d)(i) Opening Stock of FG – Manufactured Products
Quantitative Details 2011-12 (d) (i) Opening Stock of FG – Manufactured Products Particulars Qty in MT Amount in Rs. Lacs Di‐ Ammonium Phosphate (DAP) 2,746 579 Ammonium Phosphatic Fertilisers 159,576 30,206 Single super phosphate 15,399 910 Plant protection chemicals ‐ 7,339 Others ‐ 2,559 Total 41
Slide 51: Quantitative Details 2011-12 (d)(i) Opening Stock of FG - Stock-in-trade
Quantitative Details 2011-12 (d) (i) Opening Stock of FG - Stock-in- trade Particulars Qty in MT Amount in Rs. Lacs Di‐ Ammonium Phosphate (DAP) ‐ ‐ Ammonium Phosphatic Fertilisers ‐ ‐ Muriate of potash 30,254 5,213 Urea 16,104 826 Plant protection chemicals ‐ 297 Others ‐ 6814 Total 13,150 51
Slide 52: Quantitative Details 2011-12 (e)(i) Closing Stock of FG – Manufactured Products
Quantitative Details 2011-12 (e) (i) Closing Stock of FG – Manufactured Products* Particulars Qty in MT Amount in Rs. Lacs Di‐ Ammonium Phosphate (DAP) 28,423 9,420 Ammonium Phosphatic Fertilisers 107,380 25,509 Single super phosphate 4,687 435 Plant protection chemicals 9,146 Others 1,916 Total 46,
Slide 53: Quantitative Details 2011-12 (e)(ii) Closing Stock of FG – Stock-in-trade
Quantitative Details 2011-12 (e) (ii) Closing Stock of FG– Stock-in- trade* Particulars Qty in MT Amount in Rs. Lacs Di‐ Ammonium Phosphate (DAP) 5,525 1,959 Ammonium Phosphatic Fertilisers 44,591 9,907 Muriate of potash 53,219 13,620 Urea 14,362 662 Plant protection chemicals 2,546 Others 5,702 Tot
Slide 54: Bonus Debentures
Bonus Debentures Rewarding RewardingCoromandel Coromandel‘s ‘sShareholders Shareholders 1.Face Value ‐Rs.15/‐ 2.Quantum of Bonus Debentures issued ‐ 1BonusDebenture for every share of Re.1/each 3.Tenor ‐ 4 years ‐ Redemption in the years 2 / 3 & 4 4.Coupon ‐ 9% (Annual) 5.Cash outgo ‐ Rs.495 cr (inc
Slide 55: Awards & Accolades
Coromandel = AWARDS & ACCOLADES Ne murugappa _ _ 7 _ 7 _ i” oye)
Slide 56: Awards 2011-12
Awards 2011-12 1. Coromandel received ‘Significant Achievement’ in the CII‐EXIM Bank Business Excellence Award 2011. 2. Kakinada Plant received the FAI award for ‘Best Overall Performance’ of an Operating Fertiliser Unit for Complex Fertilisers. 3. Visakhapatnam Plant received the CII’s National Wat
Slide 57: Awards 2011-12 (Contd..)
Awards 2011-12 ( Contd..) 8. Best L&D Strategy award by Indian Human Capital Summit‐2011. 9. National Award, 1st Prize, by Public Relations Society of India, New Delhi for Coromandel in‐house magazine‐‘The VOICE’ (for the sixth time). 10. National Award, 1st Prize, for the Corporate Film by Public R
Slide 58: Thank You
iL, Coromandel = he murugappa 58
Coromandel International — Investor Presentation (July 2012) on 6ix