Indo Rama Synthetics (India) Limited · NSE:INDORAMA

Indo Rama Synthetics (India) — Investor Presentation (April 2004)

31 slides from Indo Rama Synthetics (India)'s investor presentation, Apr 21, 2004

  1. Slide 1: Financial Highlights 2003-04 Analysts' Meet

    Indo Rama Synthetics (I) Limited Financial Highlights 2003 – ’04 Analysts’ Meet Mumbai, April 21, 2004

  2. Slide 2: Presentation Scope

    Presentation Scope 1. Major events of 2003-04 2. Financials 3. Opportunities post MFA 4. Emerging scenario 5. Expansion at Butibori 6. Advantage Indo Rama 4/21/04 1 2

  3. Slide 3: Major events of 2003-04

    Major events of 2003-04

  4. Slide 4: Policy initiatives in the past one year to prepare the industry for 2005

    Policy initiatives in the past one year to prepare the industry for the 2005 opportunity Excise duty on PFY & DTY reduced - 32% to 24% Excise duty on all spun yarn excluding 100% cotton yarn has been reduced from 16% to 12% Custom duty on FG (Fiber and Yarn) kept at 20% Custom duty on Capital Goods

  5. Slide 5: Completion of the CENVAT chain

    Completion of the CENVAT chain Last Union budget announced an extension of the CENVAT chain to the power loom sector providing a level playing field to the organised sector This sparked off protests in the un-organized sector, followed by a nation-wide strike Textile industry remained crippled for a

  6. Slide 6: Financials

    Financials

  7. Slide 7: Financial Highlights - Qtr 4

    Financial Highlights - Qtr 4 Rs. Crore Q4 (2003-04) Q4 (2002-03) Variance % change Gross Sales 503.4 429.0 74.4 17.3% Add Merchandised Sales - 42.8 (42.8) Gross Turnover 503.4 471.8 31.6 6.7% Sales (Net of Excise & inter- 368.7 369.1 (0.4) divisional sales) Other Income 26.3 7.8 18.6 Total 395.0 376

  8. Slide 8: Financial Highlights - Qtr 4

    Financial Highlights - Qtr 4 Rs. Crore 2003-04 2002-03 Variance % Q4 Q4 Change EBIDTA 110.5 69.1 41.5 60.0% Interest Cost 10.6 16.3 5.7 35.1% PBDT 100.0 52.8 47.2 89.3% Depreciation & DRE 22.1 23.0 0.9 Profit Before Tax 77.9 29.9 48.0 160.9% Provision for Taxation •MAT 3.0 0.1 (2.9) •Deferred Tax 22

  9. Slide 9: Financial Highlights - Annual

    Financial Highlights - Annual Rs. Crore Full Year Full Year Variance % (2003-04) (2002-03) change Gross Sales 2,191.0 2,006.2 184.8 9.2% Add Merchandised Sales 5.4 166.8 (161.4) Gross Turnover 2,196.4 2,173.1 23.4 1.1% Sales (Net of Excise & 1,663.6 1,724.2 (60.6) inter-divisional sales) Other Incom

  10. Slide 10: Financial Highlights - Annual

    Financial Highlights - Annual Rs. Crore Full Year Full Year Variance % 2003-04 2002-03 Change EBIDTA 396.0 370.4 25.5 6.9% Interest Cost 46.9 62.0 15.1 24.3% PBDT 349.0 308.4 40.6 13.2% Depreciation & DRE 96.5 94.6 (1.8) Profit Before Tax 252.6 213.8 38.8 18.1% Provision for Taxation •MAT 4.4 10.1 5

  11. Slide 11: Sales Analysis: 2003-04

    Sales Analysis : 2003-04 In Volume Terms In Value Terms 5% 4% 11% 12% 4% PSF PSF POY 6% POY 48% 45% FDY FDY DTY DTY Chips Chips 32% 33% 3,16,604 MT Rs. 2,191 Crore 4/21/04 1 11

  12. Slide 12: Product Mix - Production & Sales 2002-03 Vs 2003-04

    Product Mix - Production & Sales 2002-03 Vs 2003-04 Production in Sales in MT’ 000 MT’ 000 180 180 160 160 140 140 120 120 100 100 80 80 60 60 40 40 20 20 0 0 Y TY Y ps F Y TY Y ps F PS FD PO PS FD PO hi D hi D C C 2002-03 2003-04 2002-03 2003-04 4/21/04 1 12

  13. Slide 13: Operating EBIDTA 2002-03 Vs 2003-04

    Operating EBIDTA 2002-03 Vs 2003-04 22.0 20.0 18.0 16.0 19.6 17.6 14.0 12.0 10.0 Full Year EBIDTA / Net Sales % 2002-03 2003-04 24.0 24.0 22.0 22.0 20.0 20.0 18.0 18.0 21.8 16.0 22.2 16.0 14.0 14.0 16.9 12.0 14.0 12.0 10.0 10.0 First Half EBIDTA / Net Sales % Second Half EBIDTA / Net Sales % 2002-03

  14. Slide 14: Quarter by Quarter Trend 2003 Vs 04

    Quarter by Quarter Trend 2003 Vs 04 131 140 EBIDTA 118 EBIT 106 119 95 120 109 111 98 84 88 95 70 100 88 78 64 80 69 58 46 60 46 38 21 40 18 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2002-03 2003-04 2002-03 2003-04 103 PBT 96 83 PAT 72 89 78 75 73 83 63 53 58 53 47 44 63 48 40 43 43 30 33 27 23 11 23 4 4 13 3 3 Q1 Q2

  15. Slide 15: Profitability Ratios 2002-03 Vs 2003-04

    24 Profitability Ratios 2002-03 Vs 2003-0418.5 23.5 18.0 23 23.8 17.5 22.5 17.0 18.0 22 21.5 16.5 21 16.0 21.5 20.5 15.5 16.0 20 15.0 EBIDTA / Net Sales % EBIT / Net Sales % 2002-03 2003-04 2002-03 2003-04 16 12 14 10 12 15.2 8 10 10.3 8 6 6 12.4 4 7.2 4 2 2 0 0 PBT / Net Sales % PAT / Net Sales % 2

  16. Slide 16: FG Stock & Accounts Receivable Movement

    FG Stock & Accounts Receivable Movement 31st March 03 Vs 04 Stock Movement – Volume (MT) Receivables – No of Days 16 55,000 15 50,000 14 16 45,000 40,000 13 35,000 30,000 12 25,000 12 20,000 11 15,000 10,000 10 Mar-03 Mar-04 FY03 FY04 PSF POY FDY DTY CHIPS 4/21/04 1 16

  17. Slide 17: Repayment of Loans & Net-worth Buildup

    Repayment of Loans & Net-worth Buildup Repayment of Net-worth build-up Loan in Rs Crore 600 521 500 230 225 410 400 220 212 303 389 210 300 277 200 170 200 189 190 100 133 133 132 180 0 Mar-02 Mar-03 Mar-04 Repayment of Loan Equity Reserve 2001-02 2002-03 2003-04 4/21/04 1 17

  18. Slide 18: Debt : Equity Ratio

    Debt : Equity Ratio 3.75 3.44 3.25 2.75 2.42 2.25 1.75 1.51 1.25 2001-02 2002-03 FY 03-04 Debt Equity 4/21/04 1 18

  19. Slide 19: ROCE & Book Value of Shares

    ROCE & Book Value of Shares 21.0 41 20.5 39 20.0 20.7 37 19.5 35 39.5 19.0 33 18.5 31 18.0 19.0 29 17.5 30.9 27 17.0 25 Return on Capital Book Value of Share Rs Employed % 2002-03 2003-04 2002-03 2003-04 4/21/04 1 19

  20. Slide 20: Earnings Per Share - Rs

    Earnings Per Share - Rs 30 Cash EPS, 26.07 Cash EPS, 25 22.43 20 15 EPS, 12.99 EPS, 9.38 10 5 2002-03 2003-04 4/21/04 1 20

  21. Slide 21: Going Forward

    Going Forward

  22. Slide 22: Opportunities post MFA

    Opportunities post MFA January 1, 2005 will witness: Phase out of all quotas, and End of ‘country of origin’ restriction India’s current quota allocation is amongst the lowest: US jeans/trousers – India (2%), Bangladesh (6%), Cambodia (7%) EU jeans/trousers – India (4%), Bangladesh (29%), Pakistan (

  23. Slide 23: Winners and Losers post MFA

    Winners and Losers post MFA Big Winners Losers 1. China 1. Hong Kong 2. India 2. Korea 3. Taiwan 4. Africa 5. Mediterranean Block 6. Philippines 7. Thailand 8. Mexico 9. Turkey 10. Sri Lanka 11. Bangladesh 4/21/04 1 23

  24. Slide 24: Emerging scenario

    Emerging scenario China and India will be the dominant players in global textile and apparel markets Large domestic markets Vertical Textile chain and therefore globally competitive India’s domestic demand for textiles products will grow substantially because of Huge purchasing power – 100 billion p

  25. Slide 25: Domestic Market – shift from Cotton to Polyester

    Domestic Market – shift from Cotton to Polyester Apparel – 100% Polyester fabric in fashion because of bright colours Non-apparel – 100% Cotton to PC (65:35) Exports – Additional exports of Polyester and PC in line with global demands Limitation with regard to Cotton availability 4/21/04 1 25

  26. Slide 26: Emerging scenario

    Emerging scenario India’s exports will expand rapidly driven by Cost advantages – no ‘quota’ & ‘country of origin’ restrictions in the future Strong buyer relationships & proven track record Large number of garment exporters Potential for rapidly scaling up current capacities Polyester is the only f

  27. Slide 27: Polyester Expansion at Butibori

    Polyester Expansion at Butibori Step towards attaining global size of operations and competencies Capacity increases by 400 tpd lines each for PSF and POY - the highest in India (current lines in operation 240 tpd is highest) Capacity doubles from 300KT to 600 KT making Butibori plant as one of the

  28. Slide 28: Polyester Expansion at Butibori

    Polyester Expansion at Butibori Technology partner – Zimmer, Germany Operating cost of the new plant will be lower than the existing Plant because of lower utilities expenses Commercial Production by end of 2005 synchronized with the completion of IOC’s PTA plant at Panipat of 530000 MTs. Sales from

  29. Slide 29: Financial Impact of the Expansion

    Financial Impact of the Expansion Repayment of Loan & Debt : Equity Ratio Project Loan in Rs Crore 270 263 260 1.7 250 239 1.5 1.49 240 225 227 1.3 230 220 1.1 1.02 210 0.9 200 196 0.7 0.66 190 180 0.5 2003-04 2004-05 2005-06 2003-04 2004-05 2005-06 Repayment of Loan Project Loan Debt Equity 4/21/04

  30. Slide 30: Advantage Indo Rama

    Advantage Indo Rama Polyester is core business Dominant player with market share of 20% increasing over 25% Global scale, cost efficient plant Equipped to produce world class quality Assured raw material availability 4/21/04 1 30

  31. Slide 31: End.

    End.

Indo Rama Synthetics (India) — Investor Presentation (April 2004) on 6ix