Great Eastern Shipping Co. Ltd. · NSE:GESHIP
Great Eastern Shipping — The Great Eastern Shipping — Investor Presentation (April 2024)
28 slides from Great Eastern Shipping's investor presentation, April 2024
Slide 1: Corporate Presentation April 2024
CORPORATE PRESENTATION April 2024
Slide 2: Company History
‘The Great Eastern Shipping Co, Lid. COMPANY HISTOR
Slide 3: Overview
OVERVIEW Great Eastern Shipping was founded in 1948, with the purchase of a Liberty ship Today, GES is India’s largest private sector shipping company, owning and operating 43 ships and 23 offshore assets, with a balance sheet size of almost USD 2 billion More than size, we pride ourselves on being
Slide 4: Shareholding Pattern
SHAREHOLDING PATTERN Shareholding Pattern as on 31 December 2023 4
Slide 5: Corporate Profile
CORPORATE PROFILE Offshore Shipping (Bulk) (Through wholly-owned subsidiary Greatship (India) Limited) Tankers • Crude (6) Logistics (19) Drilling (4) • Products (19) Dry Bulk (14) • LPG (4) India’s largest private sector shipping company, with more than 75 years of experience in commodity shipping
Slide 6: Fleet Profile
FLEET SHIPPING Fleet DWT Number of Ships PROFILE Crude Carriers 842,958 6 Product Carriers 1,040,662 19 Gas Carriers 185,363 4 Dry Bulk Carriers 1,239,274 14 Total 3,408,257 43 OFFSHORE Fleet Number of Units Jack Up Rigs 4 Platform Supply Vessels 4 Anchor handling Tug Cum Supply 9 Vessels Multipurpo
Slide 7: Business Philosophy
BUSINESS PHILOSOPHY
Slide 8: Investment Thesis
INVESTMENT THESIS Fleet operated at global Offshore fleet – quality standards, with a large operations with low number of international balance sheet leverage customers Prudent Capital Strong cash flows Allocation across a diversified fleet Strong balance sheet High level of operating enables capaci
Slide 9: Strong Cashflows Led Net Debt USD 360 Mn to Net Cash of USD 300+ Mn
STRONG CASHFLOWS LED NET DEBT USD 360 MN TO NET CASH OF USD 300+ MN USD Mn Net Debt Expansion Phase Net Debt Reduction Phase 400 0.60 0.50 300 0.40 200 0.30 100 0.20 - 0.10 - -100 (0.10) -200 (0.20) -300 (0.30) FY2016 FY2017 FY2018 FY2019 FY2020 FY2021 FY2022 FY2023 9M Net Debt Net Debt/Equity (RHS)
Slide 10: Movement in NAV (Consolidated)
MOEVEMENT IN NAV (CONSOLIDATED) INR/SHARE NAV doubled during upcycle, with high cash profit contribution. 10
Slide 11: ROE & ROCE Historical (Consolidated)
ROE & ROCE HISTORICAL Average ROCE: 9% (CONSOLIDATED) Average ROE: 14% CONSOLIDATED ROCE 50.0% Investment in downcycle resulted in 40.0% higher ROE in upcycle 30.0% 20.0% Yields were lower, hence opportunity to invest in down cycle 10.0% 0.0% -10.0% FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY23
Slide 12: Too Much Volatility? EBITDA Movement 10 Yrs
TOO MUCH VOLATILITY? EBITDA MOVEMENT 10 YRS INR Cr Consolidated EBITDA 4000 3500 3000 Min EBITDA: INR 1294 Cr 2500 Median EBITDA: INR 1691 Cr 2000 1500 1000 500 0 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY23 9MFY24 12
Slide 13: Suez Canal/Panama Canal Disruptions Impact on Shipping
Suez Canal/Panama Canal disruptions IMPACT ON SHIPPING In the first two months of 2024, Suez Canal trade dropped by 50 percent from a year earlier while trade through the Panama Canal fell by 32 percent, disrupting supply chains Attacks on vessels in the Red Sea area reduced traffic through the Suez
Slide 14: Suez Canal/Panama Canal Disruptions Impact on Shipping
Suez Canal/Panama Canal disruptions IMPACT ON SHIPPING 14
Slide 15: Fundamentals Are Stacking Up: Demand Side
FUNDAMENTALS ARE STACKING UP DEMAND SIDE Trade pattern shift: Following the onset of Russia-Ukraine conflict, have seen the average distances of seaborne trade rise Oil demand continues to be main driver behind seaborne trade Atlantic basin provides a lot of the incremental oil, while Asia-Pacific p
Slide 16: Fundamentals Are Stacking Up: Supply Side
FUNDAMENTALS ARE STACKING UP SUPPLY SIDE Orderbook significantly lower than historical levels. Yard capacity has shrunk significantly in the last 15 yrs Large Korean yards are full with containers and LNG orders almost till end CY26 Disruption in Suez and Panama canal 16
Slide 17: Low Orderbook to Fleet Ratio Historical
LOW ORDERBOOK TO FLEET RATIO HISTORICAL Historic Order Book as a % of fleet (Calendar Year) 90% 80% 70% 60% 50% 40% 30% 20% 7% 14% 10% 8.7% 0% Bulkers Product tankers Crude tankers Sources: Industry Reports 17
Slide 18: Offshore Subsidiary Greatship Story FY16 to FY21
OFFSHORE SUBSIDIARY GREATSHIP STORY FY 16 to FY21 • Most challenging years for the offshore sector since late 80s • Utilization levels across asset classes dropped to historic lows, charter rates came down to levels that barely generated any +ve EBITDA • A large part of industry went through financi
Slide 19: Offshore Subsidiary Greatship Story Post FY21
OFFSHORE SUBSIDIARY GREATSHIP STORY Post FY21 • Utilization levels have improved • E&P activities have started to increase • Contracts are getting repriced at levels which generate significant EBITDA • The business has now come back to profitability 19
Slide 20: Financial Highlights (INR Crores)
FINANCIAL HIGHLIGHTS Standalone Conslidated Q3 Q3 9M Q3 Q3 9M Fig in INR Crores FY24 FY23 FY24 FY24 FY23 FY24 In come St at e me n t Revenue* 1,110 1,261 3,401 1,396 1,522 4,192 EBITDA* 689 771 2,074 789 881 2,408 N e t P rofi t 514 605 1 ,5 7 9 552 640 1 ,6 7 7 Bal an ce Sh e e t Total Assets 13,25
Slide 21: Financial Highlights (USD Mn)
FINANCIAL HIGHLIGHTS Standalone Conslidated Q3 Q3 9M Q3 Q3 9M Fig in USD Mn FY24 FY23 FY24 FY24 FY23 FY24 Income Statement Revenue* 134 154 412 168 186 507 EBITDA* 83 94 251 95 107 291 Net Profit 62 74 191 66 78 203 Balance Sheet Total Assets 1,593 1,472 1,593 1,967 1,863 1,967 Equity 1,167 967 1,16
Slide 22: Financial Highlights: Key Financial Figures
FINANCIAL HIGHLIGHTS Standalone Conslidated Q3 Q3 9M Q3 Q3 9M FY24 FY23 FY24 FY24 FY23 FY24 Key Financial Figure Return on Equity (ROE%)** 22% 31% 23% 19% 27% 20% Return on Capital Employed (ROCE%)** 17% 23% 18% 16% 20% 16% Gross Debt/Equity (x) 0.31 0.46 0.31 0.34 0.50 0.34 Net Debt/Equity (x) (0.2
Slide 23: Diversification and Prudent Capital Allocation Helped Outperform Peers
DIVERSIFICATION AND PRUDENT CAPITAL ALLOCATION HELPED TO OUTPERFORM PURE PLAY PEERS ROE Vs Max Net Debt/Equity - 5 years 1.25 1.15 Product Tankers Max 5 yrs Net Debt/Equity 1.05 Crude Tankers 0.95 0.85 LPG Carrier 0.75 Dry Bulk GESCO 0.65 0.55 0.45 0.35 0.25 5% 10% 15% 20% 25% 30% Average 5 yrs ROE
Slide 24: Sustainability
SUSTAINABILITY 24
Slide 25: Initiatives on Environment
INITIATIVES ON ENVIRONMENT Most of our vessels are retrofitted with energy saving measures, including • Propeller caps and ducts • More efficient propellers • High performance paints Savings of between 5 and 10% are achieved with these measures Apart from these, we also use voyage routing software t
Slide 26: Great Eastern CSR Foundation (GECSRF)
GREAT EASTERN CSR FOUNDATION (GECSRF) Since 2015, GECSRF has partnered with 49 NGOS under the three key CSR focus areas. • Education: More than 1.35 Lakh students reached out through primary and secondary education. • Health: More than 72,000 women and 26,600 children provided with health services –
Slide 27: Great Eastern CSR Foundation (GECSRF)
GREAT EASTERN CSR FOUNDATION (GECSRF) GECSRF currently supporting 28 NGOs working under health, education and livelihoods across 17 states in India EDUCATION HEALTH LIVELIHOODS 1. Adhyayan Quality Education 1. Anushkaa Foundation for 1. Ayang Trust Foundation (AQEF) Eliminating Clubfoot (AFEC) 2. Al
Slide 28: Thank You
THANK YOU visit us at www.greatship.com 28
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