Coromandel International Limited · NSE:COROMANDEL
Coromandel International — Investor Presentation (May 2021)
30 slides from Coromandel International's investor presentation, May 2021
Slide 1: Investor Presentation
Investor Presentation Motilal Oswal 1 May 2021
Slide 2: Disclaimer
Disclaimer Certain statements made in this presentation may not be based on historical information or facts and may be “forward looking statements,” including those relating to general business plans and strategy of Coromandel International Ltd, its future outlook and growth prospects, and future de
Slide 3: Agriculture Trends: Global & India
Agriculture Trends: Global & India 3
Slide 4: Global: Increasing population and wealth to drive up global food consumption
Global: Increasing population and wealth to drive up global food consumption Strong increase in food demand expected Increasing Food consumption Transition countries Near East/North Africa Sub Saharan Africa East Asia population (M tons) Latin America & Carribean Industrial countries South Asia 6,00
Slide 5: Global agri trend: Rising consumption & resource exhaustion
Global agri trend: Rising consumption & resource exhaustion (Natural resource Pressure) Combined with non-ceasing water and land scarcity seen leading to Natural Resource pressure triangle Rising food consumption Growing population Rising overall wealth Less water availability Less arable land Clima
Slide 6: India: A decade of accelerated growth
India: A decade of accelerated growth … GDP US$B 40y 20y 20y 2011 2030 10,000 ~+$450B +$2,200B +$6,000B 8,000 6,000 $8-9T 4,000 2,000 $2.7T $500B $36B 1960 2000 2020 2030 Year Ranking basis GDP, India expected to be 3rd largest economy nominal, US$ B Note: Forecasts by International Monetary Fund, O
Slide 7: India: Unparalleled value creation in Agri sector over the next 10 years
India: … with unparalleled value creation in Agri sector over the next 10 years in India Gross value added by Agri sector (cumulative) ₹230 trillion ₹171 2019-29 trillion ₹120 trillion 2008-18 2X 1997-07 India Agri: ~$1.7 trillion to ~$3.3 trillion in 30 years 7 1. USD / INR rate conversion assumed
Slide 8: India: The opportunity and imperative for value creation in Agri sector
India: The opportunity and imperative for value creation in Agri sector over the next 10 years are large… Falling per capita land holding Imbalanced Nutrient Usage 2.5 14 Avg. landholding size (ha) N:P:K Consumption Ratio 12 2 10 1.5 8 1 6 0.5 ideal ratio → 4: 2: 1 4 FY11 → 4.7: 2.3: 1 0 2 1970-71 1
Slide 9: 8 global agri trends: Impact on India
8 global agri trends : Impact on India Rising pressure on Changing Evolution of Farm natural resources dietary preferences farm holdings labor shortages Done Pressure on natural resources Dietary patterns are evolving as Declining avg. farm holding Decreasing labour is driving greater push demand fo
Slide 10: Trends opening up significant opportunities for Agri cos
Trends opening up significant opportunities for Agri cos Implications • Balanced plant nutrition - Improved Ag input penetration • Specialized nutrients - F&V, pulses with changing dietary preferences • Precision farming / ag tech - holistic agri solution of the future • Micro-irrigation - Agri-inpu
Slide 11: Agriculture under COVID
a Coromandel = Agriculture under COVID murugappa ii
Slide 12: Agriculture under COVID
Agriculture under COVID • Agriculture Sweet Spot GVA growth (%) 10.0% • 3.4% GVA growth 5.0% 4.0% 3.4% • Record food grain (303 mil, +2%) & horticulture (327 mil, +1%) 0.0% FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 • Higher Rural spending : Rs 7.3 lakh Cr (Rs 4.4 lakh cr in FY20) -5.0% AE • MNREGA, So
Slide 13: Agriculture in FY22
Agriculture in FY22 FAO Food Price Index 180 • 11th consecutive monthly rise in Food Price Index 160 162 - Highest level since May 2014 140 125 120 121 97 • Growth led by Vegetable Oil and Cereals 100 93 100 80 • Lower output & fall in inventory levels 60 76 • Stockpiling by China Food price index C
Slide 14: FY22: Firming Raw material prices – Nov'20 onwards
FY22: Firming Raw material prices – Nov’20 onwards DAP Phos Acid 564 600 1200 998 500 1000 400 318 800 607 300 600 200 400 100 200 0 0 Ammonia Sulphur 600 547 250 225 500 200 400 150 300 247 100 77 200 100 50 0 0 • Commodity Boom - RM prices firming up • High demand in 4 key markets: China, Brazil,
Slide 15: FY22: NBS Rates
FY22: NBS Rates Nutrient rates (Rs/kg) DAP price (Rs/bag) N P K S 1900 20-21 18.789 14.888 10.116 2.374 1200 21-22 18.789 45.323 10.116 2.374 % chg 0% 204% 0% 0% Prior to Revision Post Revision • Significant correction in subsidy rates for ‘P’ based fertilisers • Budgetary allocation under NBS incre
Slide 16: Phosphatic fertiliser demand upbeat in last few years
Phosphatic fertiliser demand upbeat in last few years Phosphatic fertiliser – Industry Sales (mil tons) CAGR 26.8 24.2 22.7 4.9 4% 21.4 21.2 4.2 4.1 4.2 3.7 11.4 8% Higher nutrient consumption led by: 9.7 9.1 8.4 8.5 • Increased area under assured irrigation • Direct Income Support 10.3 10.5 4% • Ba
Slide 17: Phosphatics (DAP/NPK): Supply scenario
Phosphatics (DAP/NPK): Supply scenario Phosphatic supplies - in mil tons 25.0 45% 38% 40% 28% 29% 20.0 27% 28% 35% Need for Atmanirbharta in NPKs 7.2 30% 5.6 6.3 15.0 4.9 4.7 25% • Basic Custom Duty in RMs 20% 10.0 15% • GST in Ammonia & Sulphuric acid 12.3 12.9 12.9 13.2 13.1 5.0 10% • Supporting J
Slide 18: Phosphoric Acid: Supply – Demand Balance
Phosphoric Acid: Supply – Demand Balance • India’s total Phos Acid demand: 4.2-4.5 mil tons India – Phos Acid Scenario (in mil mt) 4.2 – 4.5 • Out of the tradable ~4.5 mil ton Phos Acid available globally, 1.2-1.3 India consumes >50% 1.0-1.1 • At current operating levels, India needs to secure suppl
Slide 19: Coromandel: Transforming Indian Agriculture
Coromandel: Transforming Indian Agriculture 19
Slide 20: Coromandel: a strong, responsible company
Coromandel: a strong, responsible company Key Facts : • Turnover: Rs. 142 billion (FY20-21) • Market Cap: Rs. 216 billion (Apr 2021) • Strong credit rating: ‘AA +’ (Stable outlook)’ with CRISIL India • Zero long term debt • ~4500 employees & ~7500 contract staff COST EFFECTIVE BRINGING PROSPERITY ST
Slide 21: Coromandel: India footprint
Coromandel: India footprint India’s largest private sector Phosphatic 16 manufacturing locations Fertilizer company Jammu Pioneers & market leaders ~750 Retail centres in Specialty Nutrients India’s largest Single Super Phosphate (SSP) Raebareli ~20,000+ dealers company Kota 5th largest Crop Udaipur
Slide 22: Coromandel: Global footprint & collaborations
Coromandel: Global footprint & collaborations Strategic Investment TIFERT—Phos acid • Highly diversified venture in Tunisia sourcing Marketing partnerships – Bio Technology • Significant market US, Canada, Europe partnership & Regional Office, presence in China International markets Rock Phosphate M
Slide 23: Coromandel: A 'Farmer First' winning business model
Coromandel: A 'Farmer First' winning business model Farmer First Seeds Portfolio Farm implements Specialty Crop Aqua/Vet Feed Fertilizer Organic Biologicals Nutrients Protection Traded Products Rural Retail Ag Tech Farm Services Testing services (Soil, Water, Tissue) Advisory Financing & Insurance 2
Slide 24: Eight key elements of our Strategy
Accelerate the innovation agenda 1 Strengthen Build power 8 2 capabilities brands Eight key elements of our Strategy to Partnering with Government on 7 3 Reinforce consumer capture the India Agri reforms strongholds Ag opportunity & deliver consistent value… Build stronger processes with focus 6 4 L
Slide 25: Moving from Grades to Brands
Moving from Grades to Brands Brand (not grades) critical for farmers (fert. / non fert.) • 66% respondents said "brand availability" was one of top factors driving purchase Selective in adoption of Specialty/ New Gen products - short-term cost focus • Still willing to invest for high value crops to
Slide 26: Leveraging Technology for Farmer Prosperity
Leveraging Technology for Farmer Prosperity ~50,000 soil tests carried out annually Farm advisory through Scientists’ Gromor Nutrient Manager based panel nutrients recommendations Hiring Farm machinery through Custom Developing superior delivery E kiosks for improving reach & product Hiring Centers
Slide 27: Coromandel: Track record of sustained financial performance
Coromandel: Track record of sustained financial performance EBITDA Profit after Taxes Revenue* From Operations (₹ Crores) (₹ Crores) (₹ Crores) 1,312 2,003 1,059 14,163 1,727 13,204 13,117 1,450 10,943 1,305 685 714 FY18 FY19 FY20 FY21 FY18 FY19 FY20 FY21 FY18 FY19 FY20 FY21 *Fertilizer revenue subj
Slide 28: The 2nd Green Revolution to be powered by superior products and agri-tech
The 1st Green Revolution driven by Agri-inputs The 2nd Green Revolution to be powered by superior Achieving self-sufficiency products, smarter delivery mechanisms & agri-tech in food grains 28 Achieving Income Security and Farm Sustainability
Slide 29: Coromandel……Bringing Smiles to the Farmers
Coromandel……Bringing Smiles to the Farmers 29
Slide 30: Thank You
Thank You Corporate Office: For Investor Relations, contact: Coromandel International Ltd., Ms Jayashree Satagopan Coromandel House, 1-2-10, SP Road JayashreeSatagopan@coromandel.murugappa.com Secunderabad, Telangana 500003 Mr Saurabh Jain JainS1@coromandel.murugappa.com Phone no: 040 6699-7300 30
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