Asian Paints Ltd. · NSE:ASIANPAINT
Asian Paints — Q2 FY2023 Earnings Presentation
30 slides from Asian Paints's earnings presentation, Oct 20, 2022
Slide 1: Investor Presentation cover letter to stock exchanges
APL/SEC/32/2022-23/48 20th October, 2022 BSE Limited National Stock Exchange of India Limited Corporate Relationship Department Exchange Plaza, Plot No. C/1, Phiroze Jeejeebhoy Towers, Block G, Bandra - Kurla Complex, 25th Floor, Dalal Street, Bandra (East), Fort, Mumbai – 400 001 Mumbai – 400 051 S
Slide 2: Classification: Confidential
Classification: Confidential
Slide 3: Delivering joy since 1942
Delivering joy since 1942…. We exist to Beautify, Preserve, Transform all Spaces and Objects, bringing happiness to the World! Classification: Confidential
Slide 4: Disclaimer
Disclaimer This communication, except for the historical information, may contain statements which reflect the Management’s current views and estimates and could be construed as forward-looking statements. The future involves many risks and uncertainties that could cause actual results to differ mat
Slide 5: Decorative Business (India): Double digit growth despite extended monsoon
Double digit growth, despite extended monsoon; Lower mix in Q2 Strong Business Momentum evident from double digit 3-year compounded growth 3 Yr Comp. gr 17.7% 3 Yr Comp. gr 19.9% Decorative Business (India) 34% 35% 20% 10% Volume Gr% Value Gr% Q2 FY'22 Q2 FY'23 3 Yr Comp. gr 18.9% 3 Yr Comp. gr 20.1
Slide 6: Consistent trend of double-digit volume growth
Consistent trend of double-digit volume growth Decorative Business (India) Volume Index *20.3% *20.2% *20.1% *17.7% 200 *15.8% *15.2% 150 100 50 - Q1 FY21 Q2 FY21 Q3 FY21 Q4 FY21 Q1 FY22 Q2 FY22 Q3 FY22 Q4 FY22 Q1 FY23 Q2 FY23 Quarterly representation of Volumes sold on base of Q1 FY19 as 100 *% rep
Slide 7: Decorative Business (India)
❖ Extended monsoon impacted sales in Q2’23, especially in West & South ❖ Double-digit growths registered in T3/T4 centers; higher than growth in T1/T2 centers Decorative Business (India) ❖ Product mix in Q2 dominated by Economy Emulsions & Undercoats; However Premium / Luxury ranges in Wood Finishes
Slide 8: New Product Introductions in Q2
SmartCare Tile Coat New Product Introductions in Q2 A pioneering Glitz Ultra Matt premium product After the mega opening the success of Royale proposition of Glitz ultra shine Waterproofing to Tile substrates Tractor Sparc Ace Power+ Enamel A unique chemistry A differentiated Which elevates the upgr
Slide 9: Home Décor Business
❖ Home Décor Foray ❖ Transitioning from ‘Share of Surface’ to ‘Share of Space’ within the Homes ❖ BeautifulHomes.com – inspiring millions to create their dream homes ❖ Beautiful Home Stores – Home Décor under one roof Home Décor Business ❖ 36 stores functional now ❖ Beautiful Homes Service – Persona
Slide 10: Home Décor Business
Home Décor Business Classification: Confidential
Slide 11: Classification: Confidential
Classification: Confidential
Slide 12: Classification: Confidential
Classification: Confidential
Slide 13: Home Décor Business: White Teak and Weatherseal
❖ White Teak offering Decorative and Designer Lighting and Weatherseal offering uPVC Windows and Doors - gaining from the synergies Home Décor Business ❖ White Teak generated revenue of Rs 24 crs during Q2 (H1 Rs 44 crs) against a LY full year revenue of Rs 58 crs ❖ Weatherseal - Revenue of Rs 7 crs
Slide 14: Home Décor Business: Kitchen and Bath
❖ Kitchen Business ❖ Rs. 100 crores+ delivery for 5th consecutive quarter Revenue ❖ Full Kitchen solutions growing well 51% 35% ❖ Strong integration with BH Store & BH Service 14% 11% aiding growth in full kitchen business Home Décor Business 227 220 ❖ Higher Loss compared to LY; due to inflationary
Slide 15: International Business
International Business Classification: Confidential
Slide 16: International Business
❖ Challenging business conditions across markets Revenue 12% ❖ Focus on PreLux & Waterproofing categories 18% 4% 710 playing out well 18% 28% 27% International Business 17% 30% 423 ❖ Business in many markets impacted by forex 326 380 shortage – Lanka, Ethiopia, Egypt, Bangladesh 175 221 40 66 Africa
Slide 17: Industrial Business
Industrial Business Classification: Confidential
Slide 18: Industrial Business
❖ PPG-AP Revenue ❖ High double digit value growth led by demand recovery across automotive segment 40% 39% ❖ Cost optimization coupled with better price 25% 25% Industrial Business realizations helped improve PBT margins for the 885 quarter & the first half to double digits 469 467 225 PPG-AP Q2 FY2
Slide 19: APL Standalone Gross Margins
Persistent Inflation running ahead of calibrated price increases, coupled with low mix in Q2, resulting in sequentially lower gross margins APL Standalone Gross Margins Material Inflation Material Inflation Material Inflation Material Inflation Material Inflation ~15% ~6% ~4% Material Inflation ~6%
Slide 20: Summary – Standalone Financials
Summary – Standalone Financials (figures in columns in Rs. crs) 20% Q2 Q2 H1 H1 37% 7,316 22% 14,872 28% 38% 47% 47% 23% 47% 23% 2,607 5,468 1,116 1,020 763 2,578 2,393 1,781 Net Sales Gross Margins PBDIT PBT PAT Net Sales Gross Margins PBDIT PBT PAT Q2 FY 23 Q2 FY22 H1 FY23 H1 FY22 ❖ Q2 FY’23 Doubl
Slide 21: Summary – Consolidated Financials
Summary – Consolidated Financials (figures in columns in Rs. crs) H1H1 Q2 Q2 35% 20% 8,431 17,009 38% 56% 53% 24% 57% 36% 32% 33% 2,995 6,212 1,228 1,094 804 2,784 2,525 1,840 Net Sales Gross Margins PBDIT PBT PAT Net Sales Gross Margins PBDIT PBT PAT Q2 FY 23 Q2 FY22 H1 FY'23 H1 FY'22 ❖ Robust Net
Slide 22: Dividend Distribution
FY 2022-23 Interim Dividend 440% ( Rs 4.40 per share) Dividend Distribution FY 2021-22 Payout Ratio : 58.6% Total Dividend 1915% (Rs 19.15 per share) Final Dividend 1550% (Rs 15.50 per share) Interim Dividend 365% (Rs 3.65 per share) Classification: Confidential
Slide 23: Immediate Outlook – Overall prospects of good demand with ease in Inflation
Immediate Outlook – Overall prospects of good demand with ease in Inflation ❖ Festive season demand in October holds the key to Q3 ❖ Consumer sentiments on an uptick – wedding season will continue ❖ Good monsoon augurs well for rural demand growths ❖ B2B Projects business should do well with constru
Slide 24: Investing for the Future
❖ Nanotechnology – Next frontier in the world of coatings; Opportunity for breakthrough innovation Investing for the Future ❖ Harind – a specialty chemicals company with Next Gen Nanotechnology at its core ❖ Primarily in the area of surface coatings & care ❖ Acquisition of majority stake in Harind p
Slide 25: Securing Key Raw Material Inputs: VAE and VAM
Backward Integration Project to manufacture Vinyl Acetate Ethylene Emulsion (VAE) and Vinyl Acetate Monomer (VAM) in India Securing Key Raw Material Inputs ❖ VAE – an emulsion of the future; a key constituent for manufacturing environment friendly paints; VAM a key ingredient that goes into VAE manu
Slide 26: White Cement Joint Venture in UAE
White Cement Joint Venture in UAE ❖ White Cement a key ingredient for Putty – a key leveling Securing Key Raw Material Inputs solution used as undercoat for painting ❖ Asian Paints making strong inroads in the putty market over the last 6 to 7 years; No. 2 player in the segment ❖ JV with 60% majorit
Slide 27: Fortifying our Leadership Position
Plan to make significant investments over next 3 years Fortifying our Leadership Position ❖ Expanding our manufacturing footprint ❖ Brownfield expansion across multiple manufacturing Plan Capital expenditure Rs crs facilities in India over next 3 years Capacity Enhancement 3400 ❖ Increasing in-house
Slide 28: Focus on Long Term Sustainable Journey
Making Responsible Choices Focus on Long Term Sustainable Journey Environment Social Governance • Community Ownership, Customer Celebrations • Water Stewardship • Empowering Safety • Energizing, Equitable, Inclusive Work Environment ESG targets now form a key parameter for Senior management performa
Slide 29: Achievements for FY 21-22
Achievements for FY 21-22 Focus on Long Term Sustainable Journey More than 3400 tonnes 282% of post-consumer flexible plastic & Water Replenishment More than 8800 tonnes 62%* reduction of post-consumer rigid plastic collected in Specific Non-process Fresh Water and recycled across 23 states in India
Slide 30: Thank You
Thank You Classification: Confidential