Zydus Wellness Limited · NSE:ZYDUSWELL

Zydus Wellness — Merger or Acquisition (2018)

26 slides from Zydus Wellness's merger presentation, 2018

1. Slide 1: Creating value as India's leading consumer wellness company

   Crea%ng value as India’s leading consumer wellness company Heinz India 1

2. Slide 2: Zydus Wellness: earliest entrant and category builder in the wellness segment

   Zydus Wellness: earliest entrant and category builder in the wellness segment • India is poised for rapid growth in the wellness segment • Research shows that an increasingly larger propor7on of Indian consumers are taking direct control of their health • Market dynamics moving towards preven7ve hea

3. Slide 3: Zydus Wellness: Poised for the Next Big Leap

   Zydus Wellness: Poised for the Next Big Leap • ZWL has demonstrated a track record of building new emerging categories, with differen7ated product proposi7ons • Philosophy of building products that empower consumers to take direct control of their wellness goals • Unparalleled delivery of consumer va

4. Slide 4: Zydus Wellness a diversified wellness experience

   Zydus Wellness a diversified wellness experience VISION Who we are We bring Wellness to your life We build new emergent categories with differen7ated product proposi7ons We will create new experiences by our products that will nourish, nurture and Philosophy of building products that are energize your

5. Slide 5: Delivering holistic access to health and wellness

   Delivering holis%c access to health and wellness Rich group legacy Innova%on-­‐led Consumer trust § 66 years of singular § Strong scien7fic and § Highly trusted brands focus on healthcare medical heritage § Customer-­‐centric business § Proven track record of § Science and innova%on-­‐led philo

6. Slide 6: 22x increase in shareholder value in the last 9 years

   22x increase in shareholder value in the last 9 years to reach a market valua7on of * INR 5,000 crs + New produc7on Sugar Free Green with Stevia & Launch of Everyuth Skincare Acquisi7on of Carna7on facility at Sikkim – new produc7on facility at ‘Sugarlite’ range Nutra (CANFL) Unit I Sikkim – Unit II

7. Slide 7: Zydus Wellness to acquire Heinz India Pvt Ltd.

   Zydus Wellness to acquire Heinz India Pvt Ltd., catapul%ng it amongst the leading consumer wellness business in India 7

8. Slide 8: Transaction highlights

   Transac%on highlights Zydus Wellness (jointly with Cadila Healthcare) to acquire 100% of Heinz India Private Limited (“Heinz India”) for a considera%on of ~ INR 4,595 crs (“Transac%on”) This valua4on includes net working capital of Rs. 40 crores, cash of Rs. 15 crore and assumes no debt. Gains a por

9. Slide 9: A strong portfolio of legacy brands with established brand leaders

   A strong poreolio of legacy brands with established brand leaders 1988 1933 1969 1951 India’s trusted #1 glucose based energy #1 prickly heat Premium ghee health food drink drink in India powder in India Extensive pan India distribu7on network 800+ Distributors 17 lakh Retailers 21 Warehouses ~ 1,00

10. Slide 10: Creating India's leading consumer wellness company

    Crea%ng India’s leading consumer wellness company Build a diversified § Trusted brands with a strong § Rare opportunity to acquire ‘INR Become a leading poreolio of brands 1,000+ crs’ consumer wellness consumer wellness brand recall value across Wellness foods business player in India § 5 of 7 cat

11. Slide 11: Value accretive acquisition

    Value accre%ve acquisi%on • Unparalleled opportunity to build a highly scaled-­‐up and synergis7c poraolio • 3x jump in revenues and EBITDA • Taps complementari7es in rural and urban markets Heinz India SAMPRITI SAMPRITI Revenues: ~ INR 530 crs Revenues: ~ INR 1,150 crs Revenues: ~ INR 1,680 crs EBI

12. Slide 12: Instant boost in share of wellness pie

    Instant boost in share of wellness pie All brands addressing daily health and wellness needs Foods Skin care Instant energy Premium Natural Prickly heat Health food drink Sugar subs%tute Buier subs%tute powder healthy ghee skin care powder SAMPRITI #1 #4 #1 #1 #1(1) #1 (1) Rank within scrubs and pee

13. Slide 13: Complementary strengths in distribution channels

    Complementary strengths in distribu%on channels Key Strengths Way Forward • Speciality channels – chemists, cosme7c, horeca Omni channel strategy leveraging Zydus Wellness • Organized trade & significant scale up in e-­‐commerce strengths of the combined en7ty • Pan India footprint • Expanding reach

14. Slide 14: Significant synergy potential in the combined business

    Significant synergy poten%al in the combined business Possible revenue synergies Possible cost savings Leverage distribu7on channels to drive Manufacturing efficiency across higher revenue growth mul7ple processes Product innova7on leveraging the Supply chain efficiencies due to Zydus Cadila group herita

15. Slide 15: Portfolio of brands

    Poreolio of brands 15

16. Slide 16: Leading brand with 98% product recall value

    Leading brand with 98% product recall value § Most distributed brand in the category at 1.7mn stores (Largest compe7tor at 0.9 mn) § Category growing at 6-­‐7% with low household penetra7on of ~ 12% § Mul7ple growth drivers include enhancing rural penetra7on, launching new flavored variants, innov

17. Slide 17: Legacy trusted brand with 90% recall value

    Legacy trusted brand with 90% recall value § Milk based Health Food Drink § One of the Highest protein content in the low penetra7on (24%) health food drink category § Reposi7oned the brand in 2017 leading to enhanced brand performance in 2018 § Mul7ple growth drivers include enhancing distribu7

18. Slide 18: Market leading and legacy brand in the prickly heat powder category

    Market leading and legacy brand in the prickly heat powder category § Prickly heat powder for summer skin problems § Fast growing prickly heat powder category at 9%+ § Maintained consistent ~ 34% market share despite growing compe77on § 100% customer awareness score and strong customer loyalty §

19. Slide 19: Fast growing market category at ~18% CAGR

    Fast growing market category at ~ 18% CAGR § Quality ‘Ghee’ for cooking § Currently a by-­‐product of Complan manufacturing § Highly fragmented market with only 2 players holding >10% market share § Primarily sold in the food service channel § Mul7ple growth drivers include expansion of the ret

20. Slide 20: India's 1st low calorie sugar substitute

    India’s 1st low calorie sugar subs%tute § Undisputed market leader with category defining market share of ~ 94% § Significant growth poten7al 60 mn+ diabe7cs in India with an increasingly health-­‐conscious urban popula7on § Category leadership reinforced through innova7ve products like Sugar Free

21. Slide 21: Nutralite - India's #1 butter substitute

    Nutralite -­‐ India’s #1 buier subs%tute and leader of low calorie spread category § Healthier alterna7ve to buter / table spreads § Opportunity to part capture the organized buter market in India § Demonstrated category and brand leadership through – -­‐ Expansion into the INR 700 crs+ mayonnais

22. Slide 22: Everyuth - Facial cleansing with a strong 'Naturals' brand equity

    Everyuth -­‐ Facial cleansing with a strong ‘Naturals’ brand equity § Large market growing at 10%+ § Market leader in 2 of 3 facial cleansing and skincare sub-­‐categories growing ahead of the category § Pioneer of Scrubs (~ 33% market share) and Peel Offs (~ 85% market share) § Strong brand grow

23. Slide 23: Fundamentals now in place to become a consumer wellness leader

    Fundamentals now in place to become a consumer wellness leader Category leadership with To leverage whitespace significant growth headroom opportuni7es Proven performance and value Innova7on track record crea7on track record Strong opera7onal and Clear margin and returns distribu7on capabili7es progr

24. Slide 24: Creating a stronghold in a Critical Growth Market

    Crea%ng a stronghold in a Cri%cal Growth Market Growth Opportunity in a large and expansive market One of the largest and fastest growing markets of consumer health Leveraging a proven track record of science and innova7on driven products A pioneer and a category-­‐creator Leadership Brands Market l

25. Slide 25: How the deal unlocks value

    How the deal unlocks value Consumers Employees Communi%es Shareholders • Science and innova7on • Beter career prospects • Support farmers and • Atrac7ve growth market backed products develop supply chains • Exci7ng work • Strengthens product • Time tested, trusted opportuni7es • Suppor7ng healthy po

26. Slide 26: Thank you

    a Thank you Zydus Wellness

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