Slide 1: Indag Rubber Ltd Q1FY17 Investor Presentation
INDAG RUBBER LTD Safety & Reliability Mile After Mile..... Q1FY17 Investor Presentation
Slide 2: Safe Harbor
Safe Harbor This presentation and the accompanying slides (the “Presentation”), which have been prepared by Indag Rubber 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 securiti
Slide 3: Content
Content S. No Particulars Page 1 Result Highlights 4 2 Retreading Industry 6 3 Corporate Overview 11 4 Financial Highlights 29 3
Slide 4: Result Highlights
Result Highlights 4
Slide 5: Financial Highlights
Financial Highlights (Rs. In crs) Q1 FY16 Q1 FY17 64 64 54 0 5 49 Excise duty benefit ended from Jan’16 Gross Excise duty Net Revenue Gross Excise duty Net Revenue Revenue Revenue Despite 16% Revenue de-growth (Rs.54crs in Q1FY17 vs. Rs.64crs in Q1FY16) Margin Profile largely intact Gross Profit * E
Slide 6: Retreading Industry
Retreading Industry 6
Slide 7: Retreading: Cold Process and Hot Process
Retreading? Retreading is a technology where the old tyres are made serviceable by removing worn out and damaged treads and replacing it with new treads Methods of Retreading Cold Process Hot Process Precured rubber of high density & available in Uncured rubber is added to a buffed casing & vari
Slide 8: Retreading Process
Retreading Process Final Inspection Enveloping & Rim Mounting & Painting Building Curing by Tread Rubber Buffing Chamber Initial Inspection Cementing and Filling Repairs & Skiving Collection of Casings 8
Slide 9: Benefits of Retreading
Benefits of Retreading Saving Money: 30%-50% of the price of New tyre with life nearly the same as New tyre Lower cost of production: In retread tyre only Less investment: required on the part of the retreading plant (no expensive moulds) 25% Natural rubber is used whereas; in new tyre around 80% of
Slide 10: Indian Tread Manufacturing Industry
Indian Tread Manufacturing Industry Market size (Rs.in crs) Un-organised Hot process Cold Process 33% 3,209 33% 3,027 2,857 2,782 2,713 Organised Cold Process 33% 20%-25% share 2010 2011 2012 2013 2014 10
Slide 11: Corporate Overview
Corporate Overview 11
Slide 12: Company Overview
Company Overview AY GAS Best Quality with Reasonable Prici “lowest Cost Per Kilometer” Distributing through 25 Depots across Country
Slide 13: History
History 1978- Incoporated Increased as JV between capacity at Khemka Group & Nalagarh plant M/s Bandag from6000 MT Inc,(USA) to 13800 MT 1979- Set up plant Foray into at Bhiwadi Foreign market Expanding Capacity (Rajasthan) 2006 2015 with launch of from 13,800 MT p.a. 1984- Listed on BSE
Slide 14: Focused Management
Focused Management • M.S. in Foreign Trade & MBA • With the company since 2001, in Production Management served as the MD of GAIL & from the Columbia University, Enron India (NG) until 1998 New York, U.S.A. • Post-graduate in Mathematics • Over 40 years of experience Member of the Institute of in pr
Slide 15: Focused Management
Focused Management Ms. Bindu Saxena Mr. P R Khanna Mr. R Parameswar Mr. Harjiv Singh Non Executive Director Non Executive Director Non Executive Director Non Executive Director (Independent) (Independent) (Independent) (Independent) Mr. J K Jain Mr. Nirmal Chaturvedi Mrs. Manali D Bijlani Chief Fina
Slide 16: Flow of Business
Flow of Business Fleet Owners Run Treads get Worn the Vehicles after certain Usage Retread the same Old Buy new Tire Tire Manufactures & Supplies the Best Quality with Reasonable Pricing Retreading Products to Retreaders Cost of Savings Cost of Retreaded New Tyres 50-70% Tyres 30-50% 16 100%
Slide 17: Manufacturing Facilities
Manufacturing Facilities State of the art manufacturing unit Located at Nalagarh Industrial Estate in Himachal Pradesh Advanced Technology in terms of machinery and equipments Modern Retreading Cum-Training centre to impart high quality Brand – Indag, Zoma & Maxmile Use superior raw materi
Slide 18: Products
Products Precured Tread Rubber Un vulcanised Rubber Capacity of 20,000 MT strip gum Capacity of 1800MT Radial and Bias Range Bonding gum for curing Range from Passenger to process Truck/Bus Tyre Specifically manufactured OTR & Tractor to provide longer shelf life Envelope Universal Spr
Slide 19: Distribution Network
Distribution Network +25 Depots For speedy delivery of products Pan India Presence 1200+ Retreaders 100-150 Dealers 25 Depots PAN India basis 19
Slide 20: Training Retreaders ensure Quality
Training Retreaders ensure Quality Training imparted by To achieve Highest Engineers who has unique standards of Quality while qualifications of Retreading re-treading Training Centre Safety in all areas & High Marketing the Product & Standard Products & Differentiating from Others Service Delivery
Slide 21: Key Raw Materials
Key Raw materials Raw material composition Raw Material Vendors Other Chemicals 20% Rubber 50% Carbon Black 30% Main vendors for Natural Rubber are located at South region (Kerala)/North East Takes minimum 7 days to reach the material from south region to Nalagarh plant Maintain minimum 7-8 da
Slide 22: Large Opportunities
Large Opportunities Increase in Implementation of Radialisation in CV GST segment Increase in CV Sales 22
Slide 23: Increase in CV Sales
Increase in CV Sales CV Production Trends As Industrial Activity Picks up – More Demand for Commercial Vehicles for Movement of Goods – More Tires worn out – Retreading done on Tires 832,649 782,814 699,035 698,298 IIP Growth Rate 5.2% 2.8% FY13 FY14 FY15 FY16 -0.1% CV Domestic Sales Trends FY14 FY1
Slide 24: Global Radialisation Penetration
Global Radialisation Penetration Western Europe 100% Central Europe 95% Eastern Europe 27% North America 96% South America 65% Asia 52% India 21% Africa/Middle East 72% World 68% Current Radialisation in India is expected to be in the range of 28%-30% and expected to increase to 45% - 50% in next 3
Slide 25: Increase in Radialisation in CV segment
Increase in Radialisation in CV segment Radialisation in Truck & Bus 70 66% Radialisation requires: Better Road 65 conditions, No overloading & 60 Proper Maintenance of Vehicles 56% 55 Better Road Conditions - Faster 50 44% vehicles, running on radials will 45 consume tyres more frequently, 40 narro
Slide 26: GST - A Game Changer
GST - A Game Changer Retreading was dominated by Unorganised Players – Slow Shift towards Organised • Difference in Pricing between Organised and • Quality Precured Tread – Unorganised is mainly due Longer Life of Tire to taxes • As Radial Tires are Quality Pricing • GST implementation would Expensi
Slide 27: Capacity Expansion – To Grab Opportunities
Capacity Expansion – To Grab Opportunities Added Capacity Addition Existing in order to be ahead of the curve 20,000 6,200 13,800 4,850 8,950 6,550 2,400 13,800 3,500 3,050 8,950 2,000 1,500 6,550 3,500 2,000 1983-84 1989-90 2005-06 2006-07 2009-10 2015-16 • Capacity expansion of 6,200 MTPA is on st
Slide 28: Our Key Strengths
Our Key Strengths Strong Balance Quality through Sheet Training Innovations & Invention of Different Recipes & Patterns Cost Effective High RoCE 28
Slide 29: Financial Highlights
Financial Highlights 29
Slide 30: Financial Highlights – Yearly
Financial Highlights – Yearly Total Revenue* EBITDA* EBIT PAT (Rs. In crs) +11% 51 +25% 245 258 44 236 234 216 39 36 30 150 17 FY11 FY12 FY13 FY14 FY15 FY16 FY11 FY12 FY13 FY14 FY15 FY16 +27% 48 +24% 33 32 42 28 36 25 33 21 28 15 11 FY11 FY12 FY13 FY14 FY15 FY16 FY11 FY12 FY13 FY14 FY15 FY16 30 CAGR
Slide 31: Financial Highlights – Q1 FY17
Financial Highlights – Q1 FY17 Particulars (Rs. In Crs) Q1FY17 Q1FY16 Gross Revenue 53.9 64.1 Excise Duty 5.1 0 Net Revenue from Operations 48.8 64.1 Other Income 0.9 1.4 Total Revenue 49.7 65.5 Cost of Material Consumed 28.2 39.3 Changes in Inventories -1.0 -0.5 Employee Expenses 4.9 4.9 Other Expe
Slide 32: Balance Sheet
Balance Sheet Particulars Rs. Crores Mar-16 Mar-15 Particulars Rs. Crores Mar-16 Mar-15 Shareholder’s Fund 157.1 128.0 Non-current assets 86.8 42.4 Share capital 5.3 5.3 Fixed assets (inc. CWIP) 31.8 26.7 Non-current Investments 53.7 14.0 Reserves & Surplus 151.9 122.8 Long-term loans and advances 1
Slide 33: Dividend Pay-out
Dividend Pay-out 12.6 12.2 EPS DPS 10.7 9.5 8.0 4.2 2.0 2.4 2.4 1.2 1.6 0.8 FY11 FY12 FY13 FY14 FY15 FY16 Earning Per Share*(Rs.) 4.2 8.0 9.5 10.7 12.6 12.2 Dividend Per Share* (Rs.) 0.8 1.2 1.6 2.0 2.4 2.4 Dividend Payout (%) 19% 15% 17% 19% 19% 20% *Adjusted EPS & DPS for the split 33
Slide 34: For further information, please contact
For further information, please contact Company : Investor Relations Advisors : Indag Rubber Ltd Strategic Growth Advisors Pvt. Ltd. CIN: L74899DL1978PLC009038 CIN: U74140MH2010PTC204285 Mr. Anil Bhardwaj, Sr. Dy. G.M. (Finance) Ms. Neha Shroff / Ms. Ruchi Rudra anil@indagrubber.com sneha@sgapl.net