Parag Milk Foods Ltd. · NSE:PARAGMILK
Parag Milk Foods — Q3 FY20 Earnings Presentation
42 slides from Parag Milk Foods's earnings presentation, Jan 30, 2020
Slide 1: Parag Milk Foods Limited Investor Presentation
PARAG MILK FOODS LIMITED Investor Presentation January 2020
Slide 2: Safe Harbor
Safe Harbor This presentation and the accompanying slides (the “Presentation”), which have been prepared by Parag Milk Foods Limited (the “Company”), have been prepared solely for information purposes and do not constitute any offer, recommendation or invitation to purchase or subscribe for any secu
Slide 3: Contents
Contents 9M & Q3 FY20 Financials & 1 Key Developments 4 Financial Highlights 2 Company Overview 5 Annexures 3 Industry Dynamics 3
Slide 4: Consolidated Financial Analysis – 9M FY20
Consolidated Financial Analysis – 9M FY20 Revenue (Rs. Mn) EBITDA (Rs. Mn) Product wise Revenue Break-up (Rs. Mn) +10.4% -4.8% 19,027 1,798 1,711 17,235 19,027 17,235 12.3% 12.3% 11% 18.3% 18.5% 12% 9M FY19 9M FY20 9M FY19 9M FY20 PAT (Rs. Mn) Margins (%) 67.4% 11% 67.5% EBITDA% PAT% -6.5% 894 836 -
Slide 5: Consolidated Financial Analysis – Q3 FY20 (QoQ)
Consolidated Financial Analysis – Q3 FY20 (QoQ) Revenue (Rs. Mn) EBITDA (Rs. Mn) Product wise Revenue Break-up (Rs. Mn) -1.1% +5.9% 6,400 6,329 555 588 6,400 6,329 10.8% 12.9% 19% 19.0% 18.5% -4% Q2 FY20 Q3 FY20 Q2 FY20 Q3 FY20 PAT (Rs. Mn) Margins (%) 68.1% -2% 67.5% EBITDA% PAT% -3.2% 285 276 9.3%
Slide 6: Key Highlights
Key Highlights • Consolidated Revenue from Operations for Q3 FY20 stood at Rs. 6,329 million, a minor slip of 1.1% QoQ from Rs. Revenue 6,400 million in Q2 FY20. • Growth was subdued on account of the shortfall in milk availability during the quarter • Gross Profit for Q3 FY20 stood at Rs. 1,612 mil
Slide 7: Consolidated Profit & Loss Statement
Consolidated Profit & Loss Statement Particulars Q3 FY20 Q3 FY19 YoY Q2 FY20 QoQ 9M FY20 9M FY19 YoY Revenue from Operations 6,329.3 6,006.0 5.4% 6,400.3 -1.1% 19,026.9 17,235.1 10.4% Raw Material Costs 4,717.6 4,048.8 4,757.3 14,087.8 11,842.5 GROSS PROFIT 1,611.7 1,957 -17.7% 1,643.0 -1.9% 4,939.1
Slide 8: Marketing Campaigns & Consumer Engagement Initiatives
Marketing Campaigns & Consumer Engagement Initiatives GO Cheese Gowardhan Ghee & Paneer Launched GO Cheese Blends • The product is a mix of two types of cheese - Cheddar & Mozzarella • Available in diced form for “Out of Home” consumption segment i.e. HORECA in 1 kg & 2 kgs sizes • Shelf Life - ~9 M
Slide 9: Company Overview
Company Overview Sustainability Innovation
Slide 10: Parag at a Glance
Parag at a Glance Strong State-of-the-art Strong 170+ SKU’s 7 Brands Ranked #1 Relationships Facilities Distribution Aggregate milk Gowardhan processing capacity Pan-India Go Established Strong of 2.9 mn litres per Diversified product Parag Milk Foods Distribution Network Pride Of Cows Relationships
Slide 11: Evolution of the Company
Evolution of the Company 1992 1998 2005 2008 2010 2011 Parag Milk Foods Ltd founded Commissioned Manchar Birth of Bhagyalaxmi Commissioned “Go Cheese Palamaner plant was Birth of ‘Pride of Cows’, a in 1992 with one purpose: plant and began manufacturing Dairy Farm - India’s most World” - India’s lar
Slide 12: Our Diverse Product Portfolio catering to all segments of customers
Our Diverse Product Portfolio catering to all segments of customers Brands Target Customer Group Positioning ▪ Household consumers seeking premium quality cow’s milk ▪ Health enthusiasts Premium ▪ Children and the youth primarily for direct consumption ▪ On-the-go consumption as source of instant no
Slide 13: Our Brand Power
Our Brand Power 2nd Largest Player in Cheese in the India with Pioneers of Fresh Paneer with a 75 Day Shelf Life 35% Market Share Leaders & Pioneers of Cow Ghee category Own one of the Largest Cow Farms in India under Brand ‘Gowardhan’ Ghee India’s First Company to launch a truly made Leading privat
Slide 14: Pan-India Reach Distribution Network
Last mile availability from ‘Farm to Fork’ Pan-India Reach Distribution Network Route-to-market Strategy Depot Super Stockist Jammu 19 Depots Jalandhar Parwanoo Karnal Fresh Milk Delhi Siliguri Guwahati 140+ Exports Jodhpur Udaipur Jaipur Kanpur Patna Super Stockists Products General Trade Ranchi Mo
Slide 15: Partner with Leading Institutions and Quick Service Restaurants
Partner with Leading Institutions and Quick Service Restaurants Interact with Customers at Customization of the Maintaining the Strong/ Long term the Inception Phase of product according to the Exclusivity of the Relations with the Product and even help Need Product Customers them to curate a menu S
Slide 16: A Pan-India Manufacturing Footprint
A Pan-India Manufacturing Footprint Key Features : Parag’s Manufacturing Footprint State-of-the-art Technology Newly Acquired • One of the Largest Cheese Plants in India Facility from Danone Sonipat Plant, Haryana • India’s 1st state-of-the-art fully integrated Whey Protein Plant • Fully automated P
Slide 17: Farmer Relationship is an Integral part of our Business
Farmer Relationship is an Integral part of our Business 3-tier Milk Procurement Process Procurement Network Farmer Services Village collection centres Never Say No for Milk procure milk Correct Quantity & Tier 1 Quality from over 2 lakh farmers in 29 districts Haryana Supplying Cattle feed at subsid
Slide 18: Board of Directors
Board of Directors Mr. Devendra Shah Mr. Pritam Shah Chairman Managing Director Mr. B. M. Vyas Mr. Sunil Goyal Director Independent Director Mr. Narendra Ambwani Mr. Nitin Dhavalikar Independent Director Independent Director Mrs. Radhika Pereira Mr. Ramesh Chandak Independent Director Director The B
Slide 19: Our Management Team
Our Management Team Mr. Venkat Shankar Mr. Shashikant Dalmia Ms. Akshali Shah Chief Executive Officer Chief Financial Officer VP – Strategy (Sales & Marketing) He has more than 15+ years of experience in the He has been with the group for the last 7 years and An MBA in Family Managed Business from S
Slide 20: Integration of Technology across all verticals
Integration of Technology across all verticals Business intelligence and Seamless integration of our Analytics captured through manufacturing facilities, cold SAP chain and our distribution network of super-stockists & retailers Theory of Constraints (Vector) Dashboard for live monitoring of order t
Slide 21: Our Strategy for Value Creation
Our Strategy for Value Creation Increase Operational Efficiencies Focus on Health & Nutrition Leverage in-house technological, R&D capabilities Introduce healthy & nutritious product variants like to: ▪ Whey protein powder for mass consumption and in ▪ Maintain strict operational controls different
Slide 22: Industry Dynamics
Industry Dynamics
Slide 23: Indian Dairy Market
Indian Dairy Market Indian Dairy Market (US$ 107 Bn) Organised Dairy Market Unorganised Dairy (US$ 15 Bn) Market (US$ 92 Bn) Traditional Milkmen / Self Consumption at Home Cooperatives (US$ 7 Bn) Private Dairies (US$ 8 Bn) Vendors (US$ 34 Bn) (US$ 58 Bn) Milk production volume break-up Marketable Mi
Slide 24: Tremendous Growth Potential across Product Segments
Tremendous Growth Potential across Product Segments Liquid Milk Ghee Paneer Curd +15.0% +14.8% Traditional Products Growth 9,761 7,358 90,567 20,403 +14.8% +14.8% CAGR of 22,403 39,119 5,149 9,224 2,448 4,373 1,851 3,239 15% 2010 2014 2020E 2010 2014 2020E 2010 2014 2020E 2010 2014 2020E UHT Milk Fl
Slide 25: Financial Highlights
Financial Highlights
Slide 26: Key Financial Highlights
Key Financial Highlights Revenue (Rs. Mn) EBITDA (Rs. Mn) +13.5% +20.2% 23,957 2,235 19,545 1,933 14,441 1,072 FY15 FY18 FY19 FY15 FY18 FY19 PAT (Rs. Mn) Margins (%) EBITDA% PAT% ROCE% +39.1% 1,207 17.2% 15.4% 871 12.1% 9.9% 9.3% 7.4% 322 4.5% 5.0% 2.2% FY15 FY18 FY19 FY15 FY18 FY19 FY15 Pre IPO On
Slide 27: Key Financial Highlights
Key Financial Highlights Working Capital (In Days) Operating Cash Flows (Rs. Mn) -5.6% +159.5% 72 68 1,591 613 FY18 FY19 FY18 FY19 Fixed Assets Turnover Ratio Debt to Equity 19.5% 6.0 0.4 5.0 0.3 FY18 FY19 FY18 FY19 On Consolidated Basis 27
Slide 28: Consolidated Profit & Loss Statement
Consolidated Profit & Loss Statement Particulars FY19 FY18 Revenue from Operations 23,956.6 19,545.1 Raw Material Costs 16,573.6 13,678.9 GROSS PROFIT 7,383.0 5,866.2 Gross Margins 30.8% 30.0% Employee Expenses 949.9 735.2 Other Expenses 4,198.1 3,198.1 EBITDA 2,235.0 1,932.9 EBITDA Margin % 9.3% 9.
Slide 29: Consolidated Balance Sheet
Consolidated Balance Sheet Particulars Mar-19 Mar-18 Particulars Mar-19 Mar-18 ASSETS EQUITY AND LIABILITIES Non-current assets Equity Property, plant and equipment 4,023.4 3,922.7 Equity Share capital 839.4 838.9 Capital work-in-progress 290.3 204.0 Other equity 7,432.0 6,282.8 Other intangible ass
Slide 30: Annexures
Annexures
Slide 31: India’s Favourable Dynamics offer Huge Opportunities
India’s Favourable Dynamics offer Huge Opportunities Rising Middle Class • Middle class households to grow from 255 million in 2015 to 586 million in 2025 at a CAGR of 8.7% Population & Income • Rising income & disposable income to drive consumption of milk Levels & dairy products India – GDP Growth
Slide 32: India Contributes > 20% of Global Milk Production
India Contributes > 20% of Global Milk Production Top Milk Producing Countries (Million MT) Global - Animal Wise Milk Production - 2017 Countries 2017 2018E 2019E 2020E 2027E CAGR 11.5% 3.5% India 169 174 181 188 244 3.7% Cow EU – 28 164 167 167 169 177 0.8% Buffalo USA 98 98 99 100 105 0.7% Goat &
Slide 33: Milk Production in India
Milk Production in India Liberalization of the sector in 1991 led to entry of private players Dr. Verghese Kurien initiated 244 operation Flood to increase Milk Production 188 +4.3% 169 116 78 +2.8% 51 30 17 20 21 1950 1960 1970 1980 1990 2000 2010 2017 2020E 2027E Milk Production (Million MT) Sourc
Slide 34: Ghee Market (Butter Oil/Cooking Oil/Clarified Butter)
Ghee Market (Butter Oil/Cooking Oil/Clarified Butter) India’s Ghee Market Size (in US$ Million) Key Highlights 20,403 17,985 13,836 15,791 • Ghee is traditionally used as cooking oil in Indian +16.0% 10,582 households 8,030 6,030 3,075 4,463 • It is the 2nd largest category in the Indian dairy indus
Slide 35: Cheese Market
Cheese Market India’s Cheese Market Size (in US$ Million) Key Highlights 513 • Cheese is one of the fastest growing segments 410 among dairy products in India 328 +25.3% 263 • Rise in food service outlets and changing food 204 134 164 habits are major drivers 85 106 54 69 • Earlier, the cheese marke
Slide 36: Paneer (Cottage cheese)
Paneer (Cottage cheese) India’s Paneer Market Size (in US$ Million) Key Highlights 9,761 • Paneer is to India what cheese is to the Western 8,582 world and is an integral part of many Indian 7,522 +16.8% 6,597 recipes 5,030 3,806 2,896 • Paneer is the third largest segment in the milk 1,940 1,358 pr
Slide 37: Curd (Dahi)
Curd (Dahi) India’s Curd Market Size (in US$ Million) Key Highlights 7,358 6,478 4,940 5,687 • Curd industry has transformed from being a +15.4% 3,746 product that was traditionally made at home to a 2,836 branded & packaged product 2,134 1,597 1,179 • The organized curd market is growing rapidly at
Slide 38: UHT & Beverages
UHT & Beverages India’s UHT Market Size (in US$ Million) India’s Flavoured Milk Beverages Market Size (US$ Million) 1,552 716 1,239 582 985 463 +28.4% 791 +25.5% 373 493 239 313 149 194 60 90 104 2009 2011 2013 2015 2017 2018 2019E 2020E 2009 2011 2013 2015 2017 2018 2019E 2020E Key Highlights Key H
Slide 39: Whey Protein
Whey Protein Key Highlights Sports Health & Category Nutrition Nutrition Segment Segment • Whey Protein market is estimated at 35,000 MT, translating US$ 225-300 US$ 225-300 into business potential of US$ 450 Million, growing upwards Market Size Million Million of 25% • Parag has the most integrated
Slide 40: Liquid Milk Market
Liquid Milk Market India’s Liquid Milk Market Size (in US$ Million ) Key Highlights 90,567 • A majority (77%) of the milk sold in India is 79,015 unorganized and in the form of loose milk sold by 68,731 +16.4% 59,791 milkmen 45,090 33,896 25,463 • The organized sector in liquid milk is highly 18,060
Slide 41: We are present in all key Cow milk procuring States
We are present in all key Cow milk procuring States In Million MT Milk % Share of CAGR Cow Milk CAGR Sr. % Share of States Production Total Milk for last Production for last No Cow Milk (2016-17) Produced 2 years (2016-17) 2 years 1 Tamil Nadu 7.6 4.6% 2.9% 7.1 93% 3.1% 2 Karnataka 6.6 4.0% 3.5% 4.6
Slide 42: Contact Us
Contact Us Company : Investor Relations Advisors: Parag Milk Foods Limited Strategic Growth Advisors Pvt. Ltd. CIN: L15204PN1992PLC070209 CIN: U74140MH2010PTC204285 Name: Natasha Kedia Varun Divadkar / Deven Dhruva Email: natasha.kedia@paragmilkfoods.com varun.divadkar@sgapl.net / deven.dhruva@sgapl