Godawari Power & Ispat Ltd. · NSE:GPIL
Godawari Power & Ispat — Q4 FY2020 Earnings Presentation
42 slides from Godawari Power & Ispat's earnings presentation, Jun 29, 2020
Slide 1: Exchange filing cover letter
GODAWARI POWER AND ISPAT LIMITED Regd. Office & Works: Plot No. 428/2, Phase I, Industrial Area, Siltara, Raipur – 493111, Chhattisgarh Corporate Office: Hira Arcade, Near Bus Stand, Pandri, Raipur - 492004, Chhattisgarh Web Site: www.godawaripowerispat.com, Email Id: yarra.rao@hiragroup.com CIN: L2
Slide 2: Q4 & FY20 Earnings Presentation
Q4 & FY20 Earnings Presentation June 2020 1
Slide 3: Disclaimer
Disclaimer This presentation and the accompanying slides (the “Presentation”), which have been prepared by Godawari Power and Ispat Limited (the “Company”) solely for the information purposes and do not constitute any offer, recommendation or invitation to purchase or subscribe for any securities, a
Slide 4: Q4 & FY20 Strategic Update
Q4 & FY20 Strategic Update Highest Ever Production Mining Pellet Sponge Iron Billet 16,57,629 MT 26,86,510 MT 4,94,955 MT 3,44,610 MT + 7% + 7% + 8% + 15% Deleveraging Status • Repaid INR 2.13 bn of long-term debt, more than twice of a full year scheduled repayment of 1.03 bn; Consolidated Net Debt
Slide 5: Focussed on Value Creation: Net Debt Reducing & FCF increasing
Focussed on Value Creation: Net Debt Reducing & FCF increasing All figures in INR MN Net Debt to Equity 2.5x 1.9x 1.4x 1.1x 1,909 1,731 21,634 20,715 1,051 18,467 16,678 -3,162 FY17 FY18 FY19 FY20 Net Debt FcF* *FcF = Cashflow from operation – capex - interest cost 4
Slide 6: Incremental Cash Flows to be Utilised for De-Leveraging
Incremental Cash Flows to be Utilised for De-Leveraging All figures in INR MN Paid c2x times over Repaid c2x times over the scheduled the scheduled debt Debt Repayment Schedule repayment in FY19 repayment in FY20 GPIL (Standalone) ASL GGE 2,430 2,130 1,303 330 65 718 1,161 1,032 150 259 255 14 64 25
Slide 7: Clear Strategic Priorities
Clear Strategic Priorities The business environment remains highly uncertain. The performance will be driven by overall economic performance during the pandemic. However, given the company’s strategic advantage of low cost iron ore, flexibility in product mix makes us confident of achieving EBITDA h
Slide 8: Financial & Operational Impact of COVID-19
Financial & Operational Impact of COVID-19 Operational Impact • Manufacturing operations were temporarily shut in steel business from 24th March • From 9th April steps were taken to restart the operations • Plants reached to near normal capacity by 3rd week of May 2020 • Solar business continued to
Slide 9: Balance Sheet Stronger compared to Large Cap Steel Companies
Balance Sheet Stronger compared to Large Cap Steel Companies Net Debt to Equity (x) Net Debt to EBITDA (x) 1.5x 1.5x 6.8x 1.3x 1.1x 1.1x 5.2x 4.6x 4.5x 2.7x Peer1 Peer2 Peer3 Peer4 GPIL Peer1 Peer2 Peer3 Peer4 GPIL * Peers- Large cap steel companies 8
Slide 10: FY20 Operational & Financial Highlights
FY20 Operational & Financial Highlights Highest Ever Production across following segments FY20 Operational Captive Iron Ore : 7% higher at 16,57,629 MT Pellet : 7% higher at 26,86,510 MT (Volume) Sponge Iron : 8% higher at 4,94,955 MT Highlights* Steel billets : 15% higher at 3,44,610 MT D
Slide 11: Higher Volumes offsets weaker Realisations
Higher Volumes offsets weaker Realisations All figures in INR MN Sales Bridge 10
Slide 12: Q4 & FY20 Production Summary
Q4 & FY20 Production Summary Production (in MT) Q4FY20 Q4FY19 YoY (%) Q3FY20 QoQ (%) FY20 FY19 YoY (%) Iron ore Mining 4,51,875 4,36,053 4% 4,49,554 1% 16,57,629 15,47,384 7% Iron ore Pellets - GPIL 4,41,000 5,40,000 -18% 5,77,350 -24% 19,99,150 19,33,250 3% Iron Ore Pellets - ASL 1,70,446 1,65,345
Slide 13: Q4 & FY20 Sales Volume Summary
Q4 & FY20 Sales Volume Summary Sales Volume (in MT) Q4FY20 Q4FY19 YoY (%) Q3FY20 QoQ (%) FY20 FY19 YoY (%) Iron Ore Pellet - GPIL 2,89,189 4,01,771 -28% 3,83,680 -25% 13,62,296 14,52,549 -6% Iron Ore Pellet - ASL 2,04,255 1,77,431 15% 1,94,365 5% 7,42,332 5,60,832 32% Sponge Iron 14,683 30,729 -52%
Slide 14: Q4 & FY20 Realisation Summary
Q4 & FY20 Realisation Summary Realisation Q4FY20 Q4FY19 YoY (%) Q3FY20 QoQ (%) FY20 FY19 YoY (%) Iron Ore Pellet - GPIL* 7,525 6,737 12% 6,486 16% 7,091 6,809 4% Iron Ore Pellet - ASL* 5,646 5,489 3% 5,178 9% 5,600 6,051 -7% Sponge Iron 19,165 18,501 4% 15,969 20% 16,897 19,736 -14% Steel Billets 29
Slide 15: GPIL Consolidated - Profit & Loss
GPIL Consolidated - Profit & Loss Particulars (in Mn) Q4FY20 Q4FY19 YoY (%) Q3FY20 QoQ (%) FY20 FY19 YoY (%) Net Sales 7,901 8,944 -12% 8,368 -6% 32,885 33,216 -1% Total Expenses 6,345 7,066 -10% 7,082 -10% 26,643 25,323 5% Other Income -23 30 -178% 38 -162% 47 59 -21% EBITDA 1,533 1,907 -20% 1,323
Slide 16: GPIL Standalone - Profit & Loss
GPIL Standalone - Profit & Loss Particulars (in Mn) Q4FY20 Q4FY19 YoY (%) Q3FY20 QoQ (%) FY20 FY19 YoY (%) Net Sales 6,467 7,661 -16% 7,187 -10% 27,740 28,753 -4% Total Expenses 5,414 6,148 -12% 6,228 -13% 23,340 22,556 3% Other Income 3 9 -66% 11 -70% 29 30 -3% EBITDA 1,056 1,522 -31% 970 9% 4,429
Slide 17: Ardent Steel Limited Standalone - Profit & Loss
Ardent Steel Limited Standalone - Profit & Loss Particulars (in Mn) Q4FY20 Q4FY19 YoY (%) Q3FY20 QoQ (%) FY20 FY19 YoY (%) Net Sales 1,157 1,054 10% 1,007 15% 4,171 3,540 18% Total Expenses 902 904 0% 795 13% 3,165 2,628 20% Other Income 6 2 281% 0 2950% 7 3 119% EBITDA 261 152 72% 212 23% 1,013 915
Slide 18: Godawari Green Energy Limited - Profit & Loss
Godawari Green Energy Limited - Profit & Loss Particulars (in Mn) Q4FY20 Q4FY19 YoY (%) Q3FY20 QoQ (%) FY20 FY19 YoY (%) Net Sales 256 229 12% 193 32% 1,003 928 8% Total Expenses 40 13 208% 49 -18% 163 143 14% EBITDA 216 234 -8% 144 50% 840 786 7% EBITDA Margin (%) 84% 102% 75% 84% 85% Other Income
Slide 19: GPIL Standalone - Balance Sheet
GPIL Standalone - Balance Sheet Particulars 31.03.2020 31.03.2019 Particulars 31.03.2020 31.03.2019 EQUITY AND LIABILITIES ASSETS Equity (1) Non -current assets (a) Equity share capital 341 341 (a) Property, Plant and Equipment 13,689 13,115 (b) Other equity 11,631 10,434 (b) Capital work-in-progres
Slide 20: GPIL Consolidated - Balance Sheet
GPIL Consolidated - Balance Sheet Particulars 31.03.2020 31.03.2019 Particulars 31.03.2020 31.03.2019 EQUITY AND LIABILITIES ASSETS Equity (1) Non -current assets (a) Equity share capital 341 341 (a) Property, Plant and Equipment 21,646 21,332 (b) Other equity 12,912 11,352 (b) Capital work-in-progr
Slide 21: FY20 Return & Liquidity Ratios
FY20 Return & Liquidity Ratios Unit Standalone Ardent GGEL Consolidated RoE % 11% 32% 0% 12% RoCE % 15% 33% 7% 15% BVPS INR 340 - - 426 Net Debt to EBITDA x 2.68 0.75 5.51 2.65 Net Debt to Equity x 0.99 0.40 1.67 1.11 Interest Coverage x 2.88 7.51 1.64 2.97 20
Slide 22: International & Domestic Tailwinds
International & Domestic Tailwinds International Market o Iron ore globally continues to grow in strength and have hit a 12 month high recently even when everyone expected it to wilt under COVID19 pressure. China demand has been particularly strong amid fears of supply disruption in Brazil due to ri
Slide 23: Investor Presentation
HIRA- GODAWARI POWER & ISPAT INVESTOR PRESENTATION
Slide 24: Integrated Asset Portfolio; Unique Presence Across Steel Value Chain
Integrated Asset Portfolio; Unique Presence Across Steel Value Chain Asset Capacity FY20 Utilisation (%) Asset Capacity FY20 Utilisation (%) Iron Ore MS 0.4 mt 2.1 mt 79% Mining Rounds 85% 46% Iron Ore HB 0.15 mt 2.7 mt 96% Wires 64% Pellets 87% 92% 90% Sponge Ferro 16,500 mt 0.5 mt Alloys Iron 99%
Slide 25: GPIL – Focused on Generating Shareholder Value
GPIL – Focused on Generating Shareholder Value Portfolio Improving Balance Sheet De- Clear Strategy Optimisation Financials Leveraging Increasing value FY20 Revenue Flat Net Debt to equity Focus on Integrated addition by enhancing YoY Reduced to 1.1x from Steel Value Chain captive power EBITDA Margi
Slide 26: Increased Captive Consumption Provides Significant Margin Expansion
Increased Captive Consumption Provides Significant Margin Expansion Significant captive mining capacity aid in lowering costs & improving margins Iron Ore Production (MT) Captive Mining • Increased captive mining to aid in lowering cost and improving margins. Started operations at Boria Tibu Power M
Slide 27: Captive Mining Leading To Huge Raw Material Costs Saving
Captive Mining Leading To Huge Raw Material Costs Saving 4,346 4,270 4,150 3,850 3750 3,500 3,200 3,000 2,750 2,600 2,537 2,493 2,462 2,310 2195 2,181 2,050 1,800 FY15 FY16 FY17 FY18 FY19 Q1FY20 Q2FY20 Q3FY20 Q4FY20 Market Price of Iron Ore Captive Ore Landed Cost 26
Slide 28: Improving Liquidity Ratios
Improving Liquidity Ratios 5,508 5,498 5,508 4,511 3,771 Cash Flows from 3,140 Operation 2,581 Capex 1,699 1,657 1,063 827 Free Cash Flows 556 716 146 FY14 FY15 FY16 FY17 FY18 FY19 FY20 Net Debt to EBITDA Net Debt to Equity 2.75 9.87 2.54 8.09 8.14 2.132.05 1.911.94 7.07 1.38 1.27 1.11 3.423.11 0.91
Slide 29: Group Structure
Group Structure Associates JVs Godawari Power and Ispat Ltd. 48.45% 33.30% Hira Ferro Alloys Raipur Infrastructure Ltd. Co 76.12% 76.34% 25.93% Godawari Green Ardent Steel Ltd. Energy Ltd. Chattisgarh Captive Coal Mining 51.30% 33.96% 35.36% Godawari Energy Ltd. Jagdamba Power & Chhattisgarh Ispat A
Slide 30: Large Portfolio of Long-life Assets
Large Portfolio of Long-life Assets Pelletisation Plant Odisha Solar Thermal Power Plant Keonjhar: 0.69 mn MTPA Rajasthan: 50MW Siltara Integrated Plant Chhattisgarh 0.1 mn MTPA Iron ore beneficiation 2.1 mn MTPA Iron ore pellets 0.5 mn MTPA Sponge iron 0.4 mn MTPA Steel billets 0.1 mn MTPA HB wire
Slide 31: Shareholding Pattern as on March 2020
Shareholding Pattern as on March 2020 Shareholding Pattern Break up of Shareholding Pattern Public Shareholding % of Total Sh. HSBC Global 2.82% Others 29.76% 32.58% Total 32.58% 67.42% Promoter Shareholding % of Total Sh. Pledge* 32.55% Total 67.42% Promoter Public * Pledged with lenders as an addi
Slide 32: Board of Directors
Board of Directors Mr Biswajit Choudhary (Chairman & Mr BL Agarwal Independent Director) Managing Director 5 decades of experience in • 1st generation entrepreneur with Engineering, Banking & Finance; almost 4 decades of experience; Mechanical Engineering from IIT, Graduated as an electronic; Kharag
Slide 33: Board of Directors
Board of Directors Mr. Dinesh Gandhi Mr. Shashi Kumar (Independent (Non-Executive Director) Director) 4+ decades of experience; B.Sc. In 3 decades of experience in Mining Engineering; Advisor to Accounts, Finance & Project NTPC, IFFCO & Chhattisgarh Power Financing; Chartered Accountant ltd Mr. B N
Slide 34: Subsidiary | Godawari Green Energy
Subsidiary | Godawari Green Energy Operating Performance o Facility located in village Naukh, 23% 22% 19% Jaisalmer, Rajasthan 103 97 91 91 85 21% 86 81 o GGEL has been set up to implement 75 project awarded under Jawaharlal Nehru National Solar Mission, Phase I of Govt. of India o The first plant t
Slide 35: Subsidiary | Ardent Steel
Subsidiary | Ardent Steel Operating Metrics 6,053 o The company has a total production 5,600 4,932 5,050 100% capacity of 0.69 mn MTPA pellet which 97% 95% located in Phuljhar, Keonjhar, Odisha o The plant uses iron ore from the merchant mines in Barbil, located in the 50% Keonjhar district FY17 FY1
Slide 36: GPIL Standalone – Past Operational Performance at a Glance...
GPIL Standalone – Past Operational Performance at a Glance... Trend of Iron Ore Mining (mt) Trend of Pellets Production (mt) 16,57,629 15,79,693 15,47,384 19,33,250 19,99,150 18,41,050 11,75,090 15,32,200 15,80,850 14,95,100 6,57,328 9,02,550 4,44,695 3,26,358 FY 14 FY 15 FY 16 FY 17 FY 18 FY 19 FY2
Slide 37: GPIL Standalone – Past Operational Performance at a Glance...
GPIL Standalone – Past Operational Performance at a Glance... Trend of Steel Production (mt) Silico Manganese (mt) 3,44,610 2,98,418 13,700 13,772 13,136 11,116 11,403 10,537 10,517 2,27,581 2,04,162 1,97,596 1,88,190 1,77,970 FY 14 FY 15 FY 16 FY 17 FY 18 FY 19 FY20 FY 14 FY 15 FY 16 FY 17 FY 18 FY
Slide 38: Past Sales Realisations
Past Sales Realisations Sponge Iron Iron ore Pellet 19,736 18,934 18,277 7,872 7,798 16,678 16,897 6,809 7,091 13,310 5,067 5,365 12,383 4,360 FY 14 FY 15 FY 16 FY 17 FY 18 FY19 FY20 FY 14 FY 15 FY 16 FY 17 FY 18 FY19 FY20 Steel Billets 33,072 29,493 28,681 28,590 27,720 22,689 21,830 FY 14 FY 15 FY
Slide 39: Past Sales Realisations
Past Sales Realisations M.S. Round H.B. Wire 38,740 40,666 33,265 33,409 32,460 33,327 36,169 35,182 34,683 34,015 27,034 26,330 28,080 28,063 FY 14 FY 15 FY 16 FY 17 FY 18 FY19 FY20 FY 14 FY 15 FY 16 FY 17 FY 18 FY19 FY20 Silico Manganese 67,611 64,632 63,898 53,365 52,696 51,665 43,139 FY 14 FY 15
Slide 40: GPIL Consolidated – Historical Profit & Loss
GPIL Consolidated – Historical Profit & Loss Particulars (in Million) FY20 FY19 FY18 FY17 Net Sales 32,885 33,216 25,274 19,941 Total Expenses 26,643 25,323 19,305 17,033 Other Income 47 58 87 153 EBITDA 6,289 7,952 6,056 3,061 EBITDA Margin (%) 19% 24% 23% 15% Depreciation 1,369 1,329 1,318 1,201 F
Slide 41: GPIL Consolidated – Historical Balance Sheet
GPIL Consolidated – Historical Balance Sheet Particulars (INR mn) FY20 FY19 FY18 FY17 Net Worth 15,026 13,364 10,837 8,503 Non‐Controlling Interest 1,773 1,672 1,604 1,533 Debt Long Term Debt 14,645 16,431 18,730 19,799 Short Term Debt 1,604 1,393 1,344 1,955 Other Long Term Liabilities 605 127 103
Slide 42: Thank you
Thank you Investor Relations Contact: Company Contact: Ankit Toshniwal Mr. Govind Jaju Go India Advisors Godawari Power and Ispat Ltd. ankit@GoIndiaAdvisors.com govind.jaju@hiragroup.com M:+91 90224 80789 M:+91 98922 53901 41
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