Vaibhav Global Ltd. · NSE:VAIBHAVGBL
Vaibhav Global — Q2 FY23 Earnings Presentation
48 slides from Vaibhav Global's earnings presentation, October 2022
Slide 1: Vaibhav Global Limited Q2 FY23 Financial Results Presentation
Vaibhav Global Limited Global E-tailer of Fashion Jewellery, Apparels, Lifestyle Products and Accessories on TV and Digital Platforms DELIVERING JOY Q2 FY23 Financial Results Presentation
Slide 2: MD's Message
Sales for the quarter were Rs. 646 crores, up 1.8% from Rs. 635 crores in the second quarter of last year. Vs a pre-covid period of Q2 FY20 the growth is Commenting on Q2 FY23 33%. This performance is in backdrop of current high inflationary environment in western economies. Performance In Q2 our gr
Slide 3: Q2 FY23: Key Highlights
Q2 FY23 : KEY HIGHLIGHTS YoY revenue growth of 1.8%. Grew strongly at 33% vs pre-COVID Q2 FY20. MoM positive trend continues. Gross margins maintained above 60%, YoY lower due to product mix & slightly lower price pass on EBITDA improved sequentially. YoY reflects impact of lower GM, increased conte
Slide 4: Table of Contents
TABLE OF CONTENTS DELIVERING JOY Business Background Details 5 Highlights for the Quarter 21 Q2 & H1 FY23 Financial Performance 26 Financial Performance Trends 33 Annexures 40 4
Slide 5: Business Background Details
BUSINESS BACKGROUND DETAILS 5
Slide 6: Our Vision, Our Mission
GUIDING PILLARS THAT DEFINES VGL OUR VISION Team Work Be the Value Leader in Electronic Retailing of Jewellery & Lifestyle Products Positive Honesty Attitude Our Core Values OUR MISSION To deliver one million meals per day to children in need by ‘FY31’ through our one for Passion Commitment one meal
Slide 7: Corporate Overview
CORPORATE OVERVIEW Shop LC (US), Vertically- > End-to-end B2C business model Shop TJC (UK) > Presence on integrated and Shop LC > TV Homes accessed (*FTE): ~ 135 mn - Proprietary TV home-shopping & OTAs fashion retailer - Proprietary e-commerce platforms (Germany) are > Growing online presence on el
Slide 8: Truly Global
TRULY GLOBAL Retail Markets Shop LC | Shop TJC | Shop LC (US) (UK) (Germany) UK Germany Operate Through Marketplaces Canada US Sourcing China ▪ India ▪ UK ▪ China ▪ Mozambique ▪ Thailand ▪ Germany ▪ Indonesia ▪ Italy India ▪ ▪ Tanzania Russia ▪ ▪ Turkey Poland ▪ Morocco ▪ Singapore ▪ Myanmar ▪ UAE ▪
Slide 9: Completing 25 Years of Public Listing
COMPLETING 25 YEARS OF PUBLIC LISTING Growing Consistently Parameters CAGR Return FY 97 FY 22 (Rs. in crores) (25 years) (x times) Revenue 32.8 2,752.4 19.4% 84 EBITDA 4.2 303.2 18.7% 72 Profit Before Tax 4.1 242.3 17.7% 59 Profit After Tax 3.6 237.1 18.2% 66 Net Worth 17.7 1,126.8 18.1% 64 26.1% CA
Slide 10: Key Pillars
KEY PILLARS Results Presentation, Oct 2022 10
Slide 11: Key Pillars
KEY PILLARS Wider Higher Consumer & Wallet Product Share Bouquet Vertically Industry Leading Highest Integrated Gross Margin Supply Chain An Efficient Continuous Consumer Interplay of Omni-Channel Engagement Presence (Proprietary TV, OTA’s, OTT, Marketplaces & Strong Balance Sheet Social Media) In-H
Slide 12: Pools of Product Verticals
2 POOLS OF PRODUCT VERTICALS Huge Opportunity: Immediate Addressable Market of ~USD 20 bn Life-Style, Home Décor, Fashion Jewellery, Beauty Care, Apparels & Gemstones & Accessories Accessories Results Presentation, Oct 2022 12
Slide 13: Vertically Integrated Supply Chain
VERTICALLY INTEGRATED SUPPLY CHAIN ASIAN BASE Serving WESTERN COUNTRIES ➢ Vertically integrated supply-chain in Asia Primary Retail Markets ➢ Low-cost manufacturing and value sourcing base ➢ Serving affluent but value-conscious customers in Western Developed Markets USA UK China Bali Thailand German
Slide 14: Omni-Channel Sales Platform
OMNI-CHANNEL SALES PLATFORM TV DIGITAL Proprietary TV channels and OTAs Proprietary Digital Platform Mobile Applications US UK GERMANY www.shoplc.com www.tjc.co.uk www.shoplc.de HH: 81mn 27mn 27mn* Third Party Marketplaces Social Retail OTA: 17mn 18mn 2.5mn Google Marketplace * Including 2mn HH in A
Slide 15: Strengthening Private Label Brands
STRENGTHENING PRIVATE LABEL BRANDS USA UK Germany ➢ Our Strength: • Leveraging manufacturing & digital capabilities • Number of PL brands: 31 • Revenue Mix: ~25% of global B2C revenue • Margin accretive • Brand Laddering (value and mass-premium) ➢ Long-Term Objectives: • Focus on ‘IPR’ rights for br
Slide 16: 4R's of Customer Engagement
4R’S OF CUSTOMER ENGAGEMENT TV: Diverse Products Enduring relationships Linear | OTA Expanding wallet share Digital: Deep value proposition Convenience Browsers | Mobile Apps | Cross-selling Market-places | OTT| Social Media Engrossing Content Digitalization/AI Reach (HH) Registrations Retention Rep
Slide 17: Consistent Delivery
CONSISTENT DELIVERY Strong Execution Focussed Consistent Global Households Reach Repeat Purchases Retention (in million) (no. of pieces) (20+ Purchases) 135 30 124 27 27 25 89% 89% 89% 99 104 87% FY20 FY21 FY22 Sep-22 FY20 FY21 FY22 Sep-22 FY20 FY21 FY22 Sep-22 Reach Repeat Purchases Retention Rate
Slide 18: 'Delivering Joy' Through Innovation
‘DELIVERING JOY’ THROUGH INNOVATION INNOV8 FUNNEL Ideas Received Ideas Proposed to Buyers Ideas Approved by Buyers Orders Placed Products sold • An initiative to foster entrepreneurship within the organization at channels • Recently, 5 business ideas have been shortlisted for incubation • A launchpa
Slide 19: Constantly Reimagining Growth With New Designs & Products
CONSTANTLY REIMAGINING GROWTH WITH NEW DESIGNS & PRODUCTS Jewellery Design Gemstones ➢ Deals in 250+ gemstones including rare gemstones ➢ Widest possible global sourcing ➢ New gemstones contributing 3%-4% of group’s annual turnover ➢ Strengths: ➢ Strong team of professional designers ▪ In-house Test
Slide 20: Broad Based E-tailer
BROAD BASED E-TAILER B2C Revenues by Format B2C Revenues by Product Category TV revenues Digital revenues Jewellery Non-jewellery revenues 22% 11% 37% 37% 30% 27% 78% 63% 63% 89% 73% 70% FY17 FY22 H1 FY23 FY17 FY22 H1 FY23 60.5% of digital revenues in H1 FY23 were from Mobile platform Jewellery reve
Slide 21: Highlights for the Quarter
HIGHLIGHTS FOR THE QUARTER Results Presentation, Oct 2022 21
Slide 22: Recent Trends Showing Visible Improvement
RECENT TRENDS SHOWING VISIBLE IMPROVEMENT Recent revenue trend improving month-over-month H1-FY23 (YoY Revenue Growth) 7.7% 5.9%* YoY revenue growth: Q1: (7.9%) Q2: 1.8% -5.2% -6.8% -8.5% -9.9% Apr-22 May-22 Jun-22 Jul-22 Aug-22 Sep-22 * Queen’s death impacted the growth momentum temporarily during
Slide 23: UK: Freeview Channel Upgradation Yielding Positive Outcomes
UK: FREEVIEW CHANNEL UPGRADATION YIELDING POSITIVE OUTCOMES TJC (UK) upgraded channel position to 22nd from erstwhile 50th position in Jan-22 Investment now yielding positive results in terms of new customer acquisition on TV Expect market leading growth in the long run New TV Customer Acquisition (
Slide 24: Update on Germany
UPDATE ON GERMANY Germany venture increased TAM (immediate addressable market) by ~20% ➢ Now clocking monthly revenue of Euro 1mn+ at 60%+ gross margins ➢ Omni-channel presence (digital is now 31%) ➢ Covering 27mn HH, dispatching 3k pieces/day ➢ Started ‘Live & Interactive TV’ ➢ Positive Customer Or
Slide 25: Widening Digital Platform: OTT & OTA
WIDENING DIGITAL PLATFORM: OTT & OTA In US, OTT and OTA are projected to be the fastest growing video distribution medium OTT OTA Projected US residential video households 2020-2026 (million) Live & Interactive Total HH in US: 80.0 22mn Apps 60.0 46.8 40.0 25.7 Shop LC 20.0 17mn HH - 2020 2021 2022
Slide 26: Q2 & H1 FY23 Financial Performance
Q2 & H1 FY23 FINANCIAL PERFORMANCE 26
Slide 27: Financials – Q2 & H1 FY23 Performance
FINANCIALS – Q2 & H1 FY23 PERFORMANCE Growth vs Q2 FY20 Growth vs H1 FY20 Revenue Breakdown – (Rs. crore) Revenue 33.2% 37.8% (3.2%) 1,317 1,275 1.8% 635 646 Q2 FY22 Q2 FY23 H1 FY22 H1 FY23 Fashion Jewelry, Accessories & Lifestyle Products Growth vs Q2 FY20 Growth vs H1 FY20 Growth vs Q2 FY20 Gr
Slide 28: Financials – Q2 & H1 Performance (Local Currency)
FINANCIALS – Q2 & H1 FY22 PERFORMANCE Revenue Breakdown – (Local Currency) Shop LC (US) Shop TJC (UK) Growth vs Q2 FY20 Growth vs H1 FY20 Growth vs Q2 FY20 Growth vs H1FY20 14.5% (USD million) 20.5% 25.9% (GBP million) 30.0% 9.7% 39.1 8.0% 119.2 36.0 107.7 0.7% 6.4% 57.4 18.3 18.5 53.8 Q2
Slide 29: Retail Performance Trends – Q2 & H1 FY23
RETAIL PERFORMANCE TRENDS – Q2 & H1 FY23 Volume and ASP TV Sales Sales Volume ('000s) Average Selling Price US$ 3,628 35.3 36.3 31.6 30.5 2,751 1,663 1,411 Q2 FY22 Q2 FY23 H1 FY22 H1 FY23 Q2 FY22 Q2 FY23 H1 FY22 H1 FY23 Digital Sales Sales Volume ('000s) Average Selling Price US$ 26.6 25.5 2,675 23.
Slide 30: Financials – Q2 & H1 FY23 Performance
FINANCIALS – Q2 & H1 FY23 PERFORMANCE Profits – (Rs. crore) Gross Profit EBITDA Gross EBITDA 63.9% 60.9% 64.5% 61.5% 11.5% 8.1% 13.0% 7.5% Margin (%) Margin (%) 7.8% 850 783 171 3.0% 43.6% 28.3% 96 406 394 73 52 Q2 FY22 Q2 FY23 H1 FY22 H1 FY23 Q2 FY22 Q2 FY23 H1 FY22 H1 FY23 **PAT EPS (Rs.)
Slide 31: EBITDA Margin Walk
EBITDA MARGIN WALK % To Particulars Revenue Remarks EBITDA Q2 FY22 11.5% Gross Margin (3.0%) Product mix and deferred price transition Germany 0.2% Losses narrowing down Accelerated Investment in Digital & Conscious investments for future potential and (3.2%) Broadcasting scale Others (cost savin
Slide 32: Cost Optimisation
COST OPTIMISATION Annual Visible Savings (FY23) Cost • Presently ~50-60% volume of US & UK catered Arbitrage: by India $ 1-2 mn Call Centre • Focus to further increase India’s share in future • Shipping: Renegotiating and evaluating new vendors Shipping & • Labour productivity Warehousing $ 2-3 mn •
Slide 33: Financial Performance Trends
FINANCIAL PERFORMANCE TRENDS 33
Slide 34: Financial Performance Trends: Revenue
FINANCIAL PERFORMANCE TRENDS Revenue Breakdown – (Rs. crore) Revenue 5 Year CAGR: 13.9% 2,752 Growth vs H1 FY20 2,540 37.8% 1,814 1,986 3.2% 1,571 1,317 1,275 FY18 FY19 FY20 FY21 FY22 H1 FY22 H1 FY23 Fashion Jewelry, Accessories & Lifestyle Products Growth vs Growth vs H1 FY20 H1 FY20 33.6% 58.
Slide 35: Retail Performance Trends
RETAIL PERFORMANCE TRENDS Volume and ASP TV Sales Sales Volume ('000s) Average Selling Price US$ 36.3 7,837 29.9 32.6 30.5 6,275 6,998 27.0 26.4 27.7 5,737 6,070 3,628 2,751 FY18 FY19 FY20 FY21 FY22 H1 FY22 H1 FY23 FY18 FY19 FY20 FY21 FY22 H1 FY22 H1 FY23 Digital Sales Sales Volume ('000s) Average S
Slide 36: Financial Performance Trends: Profits
FINANCIAL PERFORMANCE TRENDS Profits – (Rs. crore) Gross Profit EBITDA Gross EBITDA Margin (%) 59.6% 62.5% 61.6% 62.3% 62.3% 64.5% 61.5% Margin (%) 10.1% 12.0% 13.9% 15.3% 11.0% 13.0% 7.5% 1,714 1,583 CAGR: 24.3% 1,133 1,224 7.8% 388 936 850 276 303 783 217 43.6% 159 171 96 FY18 FY19 FY20 FY21 F
Slide 37: Financial Performance Trends: Balance Sheet
FINANCIAL PERFORMANCE TRENDS Balance Sheet – (Rs. crore) Shareholders’ Equity Fixed assets including intangibles 1,127 1,148 494 481 964 697 751 550 192 120 117 163 FY18 FY19 FY20 FY21 FY22 H1 FY23 FY18 FY19 FY20 FY21 FY22 H1 FY23 Net Debt Net Assets * FY18 FY19 FY20 FY21 FY22 H1 FY23 540 556 (13) 4
Slide 38: Financial Performance Trends: Cash Flow
FINANCIAL PERFORMANCE TRENDS Cash Flow – (Rs. Crore) Operating Cash flow Free Cash Flow 324 268 181 176 203 211 86 77 62 53 38 20 (214) (27) FY18 FY19 FY20 FY21 FY22 H1 FY22 H1 FY23 FY18 FY19 FY20 FY21 FY22 H1 FY22 H1 FY23 Cashflows improved YoY as capex reverting to normal levels alongside focus on
Slide 39: Financial Performance Trends: Key Ratios
FINANCIAL PERFORMANCE TRENDS Key Ratios ROE (TTM) ROCE (TTM) 32% 61% 26% 25% 23% 23% 46% 37% 31% 13% 27% 18% FY18 FY19 FY20 FY21 FY22 H1 FY23 FY18 FY19 FY20 FY21 FY22 H1 FY23 Return ratios reflect impact of lower profitability Note - ROE – based on average net worth ROCE – based on average capital e
Slide 40: Annexures
ANNEXURES 40
Slide 41: Updates on Digital Commerce Markets
UPDATES ON DIGITAL COMMERCE MARKETS Decent QoQ recovery amidst industry wide headwinds US Retail & E-com Sales* UK Retail & E-Com Sales Retail Sales ($ Tn) E-com as % of Retail Sales Retail Sales (£ Bn) E-com as % of Retail Sales 6.5 464.3 14.0% 439.6 436.8 423.7 5.6 14.6% 14.4% 5.4 5.2 30.9% 25.0%
Slide 42: Robust Corporate Governance, Recognitions & Accolades
ROBUST CORPORATE GOVERNANCE RECOGNITIONS & ACCOLADES H1 FY23 Rs. 49.3 crores Excellence Award’ for ‘IGBC Performance Challenge 2021 for Green Built Environment LEED’s GOLD Certificate Interim Dividend Dividend Payout Policy > 20-30% of consolidated free cash flow > Higher payout in special circumsta
Slide 43: Sustainability Initiatives
SUSTAINABILITY INITIATIVES ENERGY WATER Solar 9.1 Mn KWH generated 6100 KL Rainwater per annum harvested 3.23 MW since inception EV 84 2-Wheelers & 3 4- 7KL Water saved per day with the installation of wheelers for employee low LPM faucets commute 48KL Water recycled per day, LEED Shop LC-US’ both b
Slide 44: Community Giveback
COMMUNITY GIVEBACK > Till date Served 69 million meals to Social Initiatives during pandemic underprivileged children through flagship One for Providing resources for healthcare services: One Program, ’Your Purchase Feeds…’ > Distributed 117 Oxygen Concentrators, 31 BIPAP and other key medical equip
Slide 45: VGL Shareholder Base as on 30-September-2022
VGL SHAREHOLDER BASE: AS ON 30-SEPTEMBER-2022 Holding as on Shareholding Pattern Key Shareholders 30-Sep-22 Nalanda India Fund Limited 10.19% Others 10.92% Motilal Oswal Flexi Cap Fund 5.72% Individual - >1% 3.16% Malabar India Fund Limited 5.40% AIF 0.84% Vanguard 1.58% Domestic Institutions (MF) 5
Slide 46: Management Team
MANAGEMENT TEAM Mr. Sunil Agrawal Mr. Nitin Panwad Mr. Vineet Ganeriwala Mr. Srikant Jha Mr. Deepak Mishra Managing Director, VGL Group Group CFO, VGL Group President, Shop LC (US) Managing Director, Managing Director, Shop TJC (UK) Shop LC (Germany) Mr. Ankur Sogani Mr. Deepak Sharma Mr. Raj Singh
Slide 47: Safe Harbour
Safe Harbour This presentation contains “forward looking statements” including, but without limitation, statements relating to the implementation of strategic initiatives, and other statements relating to Vaibhav Global Limited (VGL) and its affiliated companies’ future business developments and eco
Slide 48: Thank You
THANK YOU For more information please contact: Vineet Ganeriwala, President- Shop LC Nitin Panwad, Group CFO Prashant Saraswat, Head-IR Vineet@shoplc.com Nitin.panwad@vglgroup.com Prashant.saraswat@vglgroup.com +91-9358150010 +91-9571364864 +91-8920609578