Prataap Snacks Ltd. · NSE:DIAMONDYD
Prataap Snacks — Q4 FY2023 Earnings Presentation
34 slides from Prataap Snacks's earnings presentation, May 27, 2023
Slide 1: Prataap Snacks Limited Q4 & FY23 Earnings Presentation
PRATAAP SNACKS LIMITED Q4 & FY23 Earnings Presentation 27 May 2023
Slide 2: Disclaimer
DISCLAIMER Certain statements in this document may be forward-looking statements. Such forward-looking statements are subject to certain risks and uncertainties, like regulatory changes, local political or economic developments, and many other factors that could cause our actual results to differ ma
Slide 3: The Main Ingredients: Company Overview
THE MAIN INGREDIENTS: Company Overview
Slide 4: Company at a Glance
COMPANY AT A GLANCE Large, compounding market Market leadership Significant revenue scale INR 438 Bn market Market Leader in Rings, FY23 Revenue of INR ~ 16.5 Bn Growing at 14% CAGR(1) Top 2 in Extruded Snacks, 9-year revenue CAGR: 18%(2) Top 5 in Western Savoury Snacks Diverse product portfolio Nat
Slide 5: Key Milestones
KEY MILESTONES 2018 Forayed into Sweet Snacks 2022 2003 2012 Entered into 3P Contract 2020 Completed Company Converted 3P restructuring founded 2006 Doubled the 2016 Manufacturing of distribution Installed capacity of Potato at Kolkata -2 and facility to owned Guwahati new in Bengaluru, pyramid Chul
Slide 6: Company Evolution
COMPANY EVOLUTION 2003 2023 Single Product Potato Chips Product Diverse Product Portfolio Single Market Mumbai Presence Pan-India Presence Single Facility 14 Facilities Indore Facility 7 Owned and 7 3P Facilities Snapshot of Recent Growth Rs. 446 Cr Revenue Rs. 1,653 Cr 2014 40+ SKUs 125+ 2023 3 Fac
Slide 7: Diverse Product Portfolio
DIVERSE PRODUCT PORTFOLIO Appealing to consumers and trade partners % of FY23 CATEGORIES Revenue PRODUCTS 58% Chulbule Rings Wheels Pellets Scoops Puff Stix Extruded Snacks 23% Market Leader in Rings, Potato Chips Top 2 in Extruded Snacks, Top 5 in Western 16% Savoury Snacks Namkeen 3% Cookie Center
Slide 8: Branding & Marketing
BRANDING & MARKETING Brand seen to be energetic and vibrant Brand Philosophy Brand Ambassadors / Associations (1) Consumer oriented focus Providing value in multiple ways – great taste, high quality ingredients, vibrant packaging, reasonable price Brand tagline encapsulates the philosophy of deliver
Slide 9: Operational Excellence
OPERATIONAL EXCELLENCE Powered by tech and automation Data Analytics Production Automation Sales Automation Experienced Sales Analytics department working Complete ERP Solution to manage State-of-the-art SFA being used to with advanced BI Tools production processes; Software guide sales team with as
Slide 10: Established Manufacturing Network
ESTABLISHED MANUFACTURING NETWORK Reduced distribution costs; Improved time-to-market; Disciplined investment mindset STRATEGICALLY LOCATED North India (34% of rev.) MANUFACTURING 4 plants in Hisar, Nationwide manufacturing FACILITIES TO CATER TO Karnal, Kanpur, Patna footprint THE REGIONAL DEMAND •
Slide 11: Optimised Distribution Model
OPTIMISED DISTRIBUTION MODEL Direct distribution model on a nationwide scale OLD DIRECT Shifted to a direct distribution model upon hitting DISTRIBUTION Prataap Prataap DISTRIBUTION critical scale MODEL MODEL • Decentralized manufacturing footprint allows us to supply directly to distributors Supers
Slide 12: Our ESG Approach
OUR ESG APPROACH Cornerstones of doing good business • Actively working in accordance with Uniform Framework for Extended Producers Responsibility (EPR) issued by the Ministry of Environment, Forest, and Climate Change Waste management • We engage in mass collection for processing and disposal of em
Slide 13: Strong 'Value-for-Money' Brand
STRONG ‘VALUE-FOR-MONEY’ BRAND Appealing to customers across socio-demographic profiles CATEGORIES CHILDREN YOUTH ADULTS/FAMILY Rings, Kurves, Puff, Stix Chulbule Extruded Snacks Pellets Potato Chips Potato Chips Namkeen Namkeen Sweet Snacks Sweet Snacks Targeting value for money segment 13
Slide 14: Guided by an Accomplished Board
Guided by an Accomplished Board Mr. Arvind Mehta Bharat Singh Mr. V.T. Bharadwaj Chairman & Executive Non-executive Nominee Director Independent Director Director (Additional) Mr. Amit Kumat Vineet Kumar Kapila Anisha Motwani Managing Director and CEO Independent Director Independent Director Mr. Ap
Slide 15: Essential Flavours: Growth Strategies and Financial Progress
ESSENTIAL FLAVOURS: Growth Strategies and Financial Progress
Slide 16: Strategic Initiatives
STRATEGIC INITIATIVES Executing on a clear roadmap for robust and disciplined growth TOP LINE GROWTH Expand Namkeen Range Selling & Drive mix of Disciplined Product Footprint larger packs Innovation and ~44% of snacks industry (but Increase range selling and Geographical Expansion currently contribu
Slide 17: Measures to Enhance Profitability and Returns
MEASURES TO ENHANCE PROFITABILITY AND RETURNS Bottom slicing Compression of distribution structure • Reasons for lesser volumes being identified, • PSL has implemented direct distribution and levers are worked on to improve them across all regions, ahead of schedule • Indirect expenses are being sav
Slide 18: Robust Revenue Growth
ROBUST REVENUE GROWTH Consistent execution track record TOTAL REVENUE (INR Mn) COVID DISRUPTION 16,529 Avadh 13,938 13,966 Acquisition 1,688 11,706 11,711 10,174 8,940 7,572 5,493 12,250 4,460 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY23 18
Slide 19: EBITDA Margin Recovery
EBITDA MARGIN RECOVERY On the back of recent stabilization of volatile raw material prices EBITDA MARGIN (%) 5 year (FY16-FY20) average EBITDA margin was 6.9%. In FY22-23, margin was impacted by: Covid period: supply 7.6% chain & raw material 6.9% cost inflation • Inflationary trends in the overall
Slide 20: Overcoming Cost Pressures
OVERCOMING COST PRESSURES UNDERTOOK MULTIPLE INITATIVES TO OVERCOME SHARP RISE IN INPUT PRICES EBITDA MARGIN(%) There was sharp inflation in RM prices during the period RM/PM Price Increase from compared to the average during FY16-FY20 FY16-20(avg) to Q4 FY23 In addition to RM prices inflation there
Slide 21: Approval under Performance Linked Incentive (PLI) Scheme
APPROVAL UNDER PERFORMANCE LINKED INCENTIVE (‘PLI’) SCHEME The minimum CAGR for sales for calculating the incentive is 10% with the maximum cap of The benefit is available Received approval under PLI 13% CAGR for eligible products including growth in scheme of the Government of The base year for cal
Slide 22: Our Long-Term Target Operating Model
OUR LONG-TERM TARGET OPERATING MODEL CONSISTENT PROFITABILITY CAPITAL GROWTH CENTRIC EFFICIENCY ~15% >10% 15–20% Revenue growth EBITDA margin RoCE (faster than industry) 22
Slide 23: Proof of the Pudding: Q4 FY23 Performance Update
PROOF OF THE PUDDING: Q4 FY23 Performance Update
Slide 24: Operational Overview
OPERATIONAL OVERVIEW • Delivered continued momentum in top-line on the back of steady demand Reported strong growth of 19% across key geographies • Substantial increase in touchpoints over the last 12 months as well as YoY in sales in FY23 optimizing of existing network through better efficiency has
Slide 25: MD & CEO's Message
MD & CEO’s Message “We have ended FY23 with sales of Rs. 16,417.1 million, higher by 19% YoY. We are pleased to report our second successive year of strong revenue growth after covid disruption elevating us to our highest ever annual revenue. This has been achieved by expansion of our average distri
Slide 26: Abridged P&L Statement
ABRIDGED P&L STATEMENT Y-o-Y Y-o-Y (INR Mn) Q4 FY’23 Q4 FY’22 FY’23 FY’22 Change (%) Change (%) Sales/Income from operations 3,979.1 3,584.9 11% 16,417.1 13,831.0 19% Other operating Income (112.8) 29.7 NA 112.2 135.2 (17%) Total Income from Operations 3,866.3 3,614.6 7% 16,529.3 13,966.2 18% Raw Ma
Slide 27: Balance Sheet
Balance Sheet YoY YoY (INRm) March 2023 March 2022 (INRm) March 2023 March 2022 change change Closing cash and cash 219.0 189.9 15% Payables 1,038.1 901.4 equivalents 15% Fixed Deposit with Banks 385.1 695.9 -45% Other current liabilities 288.0 192.3 50% Inventory 1,352.8 1,446.2 -6% Other financial
Slide 28: Cash Flow Statement
Cash Flow Statement (INRm) FY23 FY22 YoY change Reported EBITDA 624.3 583.1 7% Commentary Noncash items in P&L 6.1 -53.3 -111% • Significant improvement in cash Change in WC 224.1 -22.0 -1120% generation in FY23 supported by further Income tax paid -57.8 -50.3 15% efficiencies in working capital man
Slide 29: Financials – Q4 & FY'23 Performance
FINANCIALS – Q4 & FY’23 PERFORMANCE Sales / Income from Gross Profit Operations (INR Mn) (INR Mn) 16,417 4,609 Gross Profit 13,966 Gross margin 3,597 1,218 26% 28% 3,979 879 3,615 32% 24% Q4 FY22 Q4 FY23 FY22 FY23 Q4 FY22 Q4 FY23 FY22 FY23 • Reported strong double-digit growth in Income from revenue
Slide 30: Financials – Q4 & FY'23 Performance
FINANCIALS – Q4 & FY’23 PERFORMANCE Adj. EBITDA (INR Mn) 624 PAT (INR Mn) 583 PAT Adj. EBITDA 216 PAT margin 203 Adj. EBITDA margin 302 5.6% 29 49 7.6% 4.2% 3.8% 0.2% 1.2% -0.8% 1.4% -30 Q4 FY22 Q4 FY23 FY22 FY23 Q4 FY22 Q4 FY23 FY22 FY23 • Initiatives to improve margins combined with softening of p
Slide 31: Financials – Q4 & FY'23 Performance
FINANCIALS – Q4 & FY’23 PERFORMANCE Cash profit Cash EPS (INR Mn) (INR Mn) 824 34.5 706 29.6 369 15.5 109 4.6 Q4 FY22 Q4 FY23 FY22 FY23 Q4 FY22 Q4 FY23 FY22 FY23 • The Company follows a conservative Resumed • Cash profit in Q4 FY23 is over 3x of cash profit in Q4 FY22 Cash EPS accounting policy and
Slide 32: Evolving Tastes: Industry Overview
EVOLVING TASTES: Industry Overview
Slide 33: Favourable Demographics Supporting Industry Growth
Favourable Demographics Supporting Industry Growth India Population Trend Total Organized Snacks Food Market Size ~43,800 (MIllions) Crores (FY23) 1,456 1,468 Potato Chips 1,418 1,431 1,444 23% 1,379 1,392 1,405 1,368 1,339 1,326 Namkeen 44% Extruded Snacks 16% 2017 2018 2019 2020 2021 2022 2023 202
Slide 34: Thank You!
Sumit Sharma Prataap Snacks Ltd Email: cfo@yellowdiamond.in THANK YOU! Mayank Vaswani / Mit Shah CDR India Tel: +91 98209 40953 / +91 99201 68314 Email: mayank@cdr-india.com / mit@cdr-india.com