Sutlej Textiles & Industries Ltd. · NSE:SUTLEJTEX
Sutlej Textiles & Industries — Q2 FY16 Earnings Presentation
36 slides from Sutlej Textiles & Industries's earnings presentation, November 2015
Slide 1: Results Presentation November, 2015
Results Presentation November, 2015
Slide 2: Safe Harbor
Safe Harbor Certain statements in this document may be forward-looking statements which are based on some assumptions and expectations of future events. Such forward-looking statements are subject to certain risks and uncertainties like regulatory changes, domestic or international economic developm
Slide 3: Agenda
Agenda 1 Q2 & H1 FY16 – Key Business Update 2 Q2 & H1 FY16 – Financial Highlights 3 Corporate Overview 4 Competitive Advantages 5 Annual Financial Highlights 6 Business Outlook 3
Slide 4: Q2 & H1 FY16 – Key Business Update
Q2 & H1 FY16 – Key Business Update 4
Slide 5: Key Business Update
Key Business Update Acquisition of Birla Textile Mills The transaction for acquisition of Birla Textile Mills (BTM) has been concluded on September 30, 2015 on receiving statutory approvals and payment of Rs 213.54 crore i.e. Rs 232.63 crore less term loans of Rs 19.09 crore outstanding as on appo
Slide 6: Key Business Update
Key Business Update Home Textiles Division Expansion on track Expanding operations in Home Textiles division at Damanganga Home Textiles, Gujarat Post completion, the capacity in its existing facility will increase to 9.6 million metres p.a. from present 5 million metres p.a with a total project
Slide 7: Key Business Update
Key Business Update Credit Rating upgrade CARE upgrades STIL rating to CARE AA- from CARE A+ signifying high degree of safety and CARE A1+ (A One Plus) for short term bank facilities India Ratings and Research Private Limited (FITCH Group) upgrades STIL to IND AA-”; Outlook Stable from IND A+ an
Slide 8: Q2 & H1 FY16 - Financial highlights
Q2 & H1 FY16 - Financial highlights 8
Slide 9: Profitability Highlights
Profitability Highlights Rs. In Cr Q2 FY16 * Q2 FY15 YoY % H1 FY16* H1 FY15 YoY % Total income 626 468 34.0% 1,185 972 22.0% Raw Material including increase/ 374 277 697 588 decrease in stocks & goods purchased Employee Cost 59 44 115 85 Other Expenses 114 79 215 161 EBITDA 79 68 16.2% 158 137 15.2%
Slide 10: Balance-sheet Highlights
Balance-sheet Highlights Rs. in Cr Sep – 15* Mar - 15 Rs. in Cr Sep – 15* Mar - 15 Shareholder’s Fund 626 558 Non-current assets 919 778 Share capital 16 16 Fixed assets 816 687 Reserves & Surplus 610 542 Long-term loans and 53 41 advances Deferred Govt. Subsidies 2 2 Non Current Investments 50 50 N
Slide 11: Yarn Business – Q2 & H1 FY16
Yarn Business – Q2 & H1 FY16 Sales (MT) Revenue (Rs. Cr.) 53,463 1,124 39,325 899 28,263 19,007 592 433 Q2 FY15 Q2 FY16 H1 FY15 H1 FY16 Q2 FY15 Q2 FY16 H1 FY15 H1 FY16 EBIT (Rs. Cr.) Revenue at Rs. 592 crore for Q2FY16 improved as against Rs. 433 crore for the corresponding quarter last year; and
Slide 12: Chairman's Comments
Chair a ’s Co e ts Mr. C. S. Nopany, Chairman The Second Quarter of the year continued to witness challenges being faced by the economy at large due to global slowdown and stressed rural economy. As the outlook for the year 2015-16 continues to be grim, our focus on the value added dyed yarn product
Slide 13: Corporate overview
Corporate overview 13
Slide 14: Company Overview
Company Overview I dia’s largest Spun-dyed Yarn manufacturer and leading textile player with presence across value chain – from Yarn to Home Textile o Increasing capacity of high margin Value-Added Products - Cotton Mélange Yarn & Cotton Blended Dyed Yarn State-of-the-art manufacturing facilitie
Slide 15: Journey from Spun-dyed Yarn Manufacturer to …
Journey from Spun-d ed ar a ufa turer to … Incorporated as a result of Corporate Restructuring in Expansion at Bhawanimandi which Textile Division of unit by 7,488 spindles to 31,104 spindles added at Sutlej Industries Limited manufacture PV Dyed Yarn Chenab Textile Mills - J&K and Damanganga Proces
Slide 16: Corporate Governance at the Helm
Corporate Governance at the Helm Board of Directors Mr. C.S. Nopany Executive Chairman Mr. U.K. Khaitan Independent Non Exec Director Mr. Amit Dalal Independent Non Exec Director Mr. Rajan Dalal Independent Non Exec Director Ms. Sonu Bhasin Independent Non Exec Director Mr. Rajiv K. Podar Independen
Slide 17: Competitive Advantages
Competitive Advantages 17
Slide 18: Competitive Advantages
Competitive Advantages Yarn – Consistent capacity addition over years 1 2 Ho e Te tile… dou li g apa it FY 3 State of the art manufacturing facilities 4 Wide Distribution Network and Marquee Clientele 5 Diverse and Wide Product Portfolio 18
Slide 19: Yarn - Consistent capacity addition over the years
Yarn - Consistent capacity addition over the years No. of Spindles 412,392 Invested in modernization 377,112 - 56% of spindle age are less than a decade old 293,736 Increasing share of Value- 261,736 253,000 added product portfolio 208,104 o Cotton Mélange Yarn 155,456 o Dyed Synthetic Yarn La
Slide 20: Home Textile… Doubling capacity by FY17
Ho e Te tile… Dou li g apa it FY Million meters per annum (mmpa) 9.6 Entered the Home Textiles segment in 2006-07 Capacity to expand by 4.6 mmpa to 9.6 mmpa by FY17 Product range includes 5.0 o Furnishing Fabrics o Curtain Fabrics 2.5 2.0 o Upholstery Fabrics o Bedcovers and Bedspreads Curre
Slide 21: State-of-the-art Manufacturing facilities
State-of-the-art Ma ufa turi g fa ilities… Chenab Rajasthan Birla Damanganga Textile Mills Textile Mills Textile Mills Home Textile Kathua, Bhawanimandi, Baddi, Daheli, Location Jammu & Kashmir Rajasthan Himachal Pradesh Gujarat Cotton Mélange Yarns Cotton Yarns Cotton Yarns Home textiles Pr
Slide 22: Wide distribution network and marquee clientele
Wide distribution network and marquee clientele Presence and strong brand image across globe in over E ol ed as e dor to… ou tries… E pa ded glo al foot pri t to e lo atio i FY … …part er to a o prehe si e …De-risk over dependence on few geography textile solution provider 22
Slide 23: Diverse and Wide Product Portfolio
Diverse and Wide Product Portfolio Cotton blended mélange yarn One stop shop for all kinds of spun dyed yarns Focus on value added yarns that fetched superior realisations like Cotton Mélange Yarn, Dyed Synthetic Yarn Diversified offerings with presence across value chain with – Yarns & Home T
Slide 24: Annual Financial Highlights
Annual Financial Highlights 24
Slide 25: Stable Revenue Growth…
Sta le Re e ue Gro th… Total Revenue... Segment break-up Rs. Cr. 1,920 1,918 1,718 1,569 Yarn 95% Home Textile 5% FY12 FY13 FY14 FY15 25
Slide 26: … with consistent track record of profitability …
… ith o siste t tra k re ord of profita ilit … EBITDA & EBITDA margin (%) Net Profit & Net margin (%) 11% 14% 16% 14% 2% 4% 7% 6% Rs. Cr. Rs. Cr. 131 306 272 115 234 77 178 32 FY12 FY13 FY14 FY15 FY12 FY13 FY14 FY15 Increasing share of Value Added Products in Portfolio likely to help margin improvem
Slide 27: … healthier return ratios in the industry
… healthier retur ratios i the i dustr Return on Equity (RoE) Return on Capital Employed (RoCE) 28% 28% 23% 23% 22% 21% 18% 12% FY12 FY13 FY14 FY15 FY12 FY13 FY14 FY15 RoE = Profit After Tax/Networth RoCE = EBITDA/Capital Employed (Networth + Debt) Consistently generating over 20% Return 27
Slide 28: Yarn – Operational Performance
Yarn – Operational Performance Sales (MT) Revenue (Rs. Cr.) 80,040 1,768 1,754 79,666 1,581 1,447 76,334 72,346 FY12 FY13 FY14 FY15 FY12 FY13 FY14 FY15 Average Sales Realisation (Rs./ Kg) 222 219 207 200 FY12 FY13 FY14 FY15 28
Slide 29: Key Ratios
Key Ratios EPS* (Rs) Total Debt/Equity Ratio (x) 80 2.56 70 1.82 47 1.31 1.07 19 FY12 FY13 FY14 FY15 FY12 FY13 FY14 FY15 * Adjusted figures post incorporating bonus effects (Company allotted Bonus shares in the ratio of 1:2 during June 2013) Gross Block (Rs. Cr.) Avg. Interest Rate of Term Loans (%)
Slide 30: Key Financial highlights
Key Financial highlights Rs. Crs. USD mn Particulars FY13 FY14 FY15 FY13 FY14 FY15 Total Revenues 1,718 1,920 1,918 324 337 315 EBITDA 234 306 272 44 54 45 EBITDA Margin % 14% 16% 14% 14% 16% 14% PAT 77 131 115 15 23 19 PAT Margin % 4% 7% 6% 4% 7% 6% Total Assets 1,149 1,273 1,341 217 223 220 Net Wo
Slide 31: Business Outlook
Sut te) and industries limited Business Outlook 31
Slide 32: Business Outlook
Business Outlook Niche Value Added Products 01 Consistent production of high margin value added products to result in greater proportion of Cotton Mélange and Cotton Blended Dyed Yarn in the overall mix Growing Core Business 02 Acquisition of BTM & enhancing spindles capacities towards manufacturing
Slide 33: Indian Textile Sector - Present
Indian Textile Sector - Present $108 Indian Textile sector current size 2nd Largest employment generator, Employs 45 mn people 49 Million spindles capacity across ~1,300 mills 12% Share of the ou tr ’s total e port i -14 14% Co tri utio to I dia’s total i dustrial produ tio 4% Co tri utio to I dia’s
Slide 34: Indian Textile Sector - Potential
Indian Textile Sector - Potential Domestic textile & apparel industry Textile & apparel exports ($ bn) Total Fibre Production (Mn Kg) ($ bn) 141 82 9.886 58 31 6.585 2011 2021P 2011 2021P FY13 FY17P Source: Ministry of Textiles, Planning Commission, Technopak, Aranca Research Robust Demand Mkt Value
Slide 35: About Us
About Us Sutlej Textiles and Industries Ltd, an ISO 9001:2008 certified Company, is one of I dia’s largest spun dyed yarn manufacturer. Under the leadership of Mr. C S Nopany, Chairman of STIL, a Chartered Accountant and Master of Science in Industrial Administration from Carnegie Mellon University,
Slide 36: THANK YOU
textiles and industries limited THANK YOU
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