Neogen Chemicals Ltd. · NSE:NEOGEN
Neogen Chemicals — Q2 & H1 FY24 Earnings Presentation
35 slides from Neogen Chemicals's earnings presentation, Nov 8, 2023
Slide 1: Exchange filing cover letter
November 9, 2023 BSE Limited National Stock Exchange of India Limited Department of Corporate Services Listing Department, Floor 25, Phiroze Jeejeebhoy Towers, Exchange Plaza, Dalal Street, Kala Ghoda, Fort Bandra Kurla Complex, Bandra (East), Mumbai - 400 001 Mumbai – 400 051 Scrip Code No: 542665
Slide 2: Exploring New Horizons – Q2 & H1 FY24 Earnings Presentation
Expanding Capabilities Exploring New Horizons Q2 & H1 FY24 Earnings Presentation November 2023
Slide 3: Safe Harbour
Safe Harbour 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
Slide 4: Table of Contents
Table of Contents Introduction to Expansion Initiatives Q2 & H1 FY24 Industry Overview – Neogen Chemicals & Key Developments Financial Performance Lithium-Ion Batteries 4 14 17 26 Way Forward CSR Initiatives Contact Us 28 30 32 3
Slide 5: Introduction to Neogen Chemicals
Introduction to Neogen Chemicals 4
Slide 6: Neogen Chemicals – At a Glance
Neogen Chemicals – At a Glance ISO 9001:2015, ISO 4 Manufacturing Sites + 2 248 R&D Facilities 9% 14001:2015 & ISO 482.5 33% 35% 45001:2018 Products Infrastructure Of workforce in Manufacturing units certified on Net worth - 5-year Revenue 5-year PAT developed by R&D team Quality & SHE management sy
Slide 7: Evolution of Neogen Chemicals
Evolution of Neogen Chemicals 1970’s to 1991 Pre-Neogen 1991 to 2016 – Site I 2016 to 2019 – Site I & II 2020 to 2023 – Multiple Sites ▪ Mr. HT Kanani graduated as a Chemical ▪ ‘Neogen Chemicals’ commenced business ▪ Acquired 12 acres of land in Dahej for ▪ Doubled Inorganic Chemicals capacity Engin
Slide 8: Key Milestones
Key Milestones Leading manufacturer of Bromine and Lithium- based specialty chemicals since 1989 Raised ~Rs. 253 crore in Nov 2023 through preferential allotment Signed agreement with MUIS, Japan to acquire manufacturing technology license for electrolytes in India Acquired 100% stake in BuLi Chem t
Slide 9: Business Overview and End User Industries
Business Overview Select Clientele Bromine Compounds Organic compounds containing chlorine, fluorine, iodine-based Pharmaceuticals combinations thereof and others including grignard reagents Agrochemicals End User Industries Organic Advanced Intermediates Chemicals Combining bromination with other c
Slide 10: Compelling value-proposition
Compelling value-proposition Innovative Product Portfolio Excellent R&D Enduring Customer Capabilities Relationships State-of-the-art Established Manufacturing Facilities Relationship with Suppliers Experienced Specialised Business Board of Directors Model with High Entry Barriers 9
Slide 11: Experienced Leadership Team
Experienced Leadership Team Mr. Anurag Surana, Non-Executive Director ▪ Holds a bachelor’s degree in commerce with Honours from the University of Delhi Mr. Haridas Kanani, ▪ Experience of more than 20 years in Contract Manufacturing business Mr. Harin Kanani, B.TECH (CHEM) M.I.I.Ch.E. ▪ A well known
Slide 12: Large Manufacturing Infrastructure
Large Manufacturing Infrastructure Strong Manufacturing Infrastructure Land Factory Land Area Capacity Certifications of Manufacturing Facilities Utilisation Inorganic Organic Chemicals Chemicals (Reactor capacity) (Tonnage) Mahape (Since 1991) 1 acre 100% 69 m3 9 m3 ISO 9001:2015 from Bureau Verita
Slide 13: Developed strong R&D capabilities
Developed strong R&D capabilities Developed 65-member dedicated R&D team, including 7 senior personnel with doctorates in chemistry (Ph. D.) from Established two in-house reputed institutions and CMD and MD are actively R&D units, one each in with 15+ years of involved and spend Mahape and Vadodara,
Slide 14: Key Export Geographies
Key Export Geographies Europe Japan China USA Korea Exporting to 29 countries, with key export geographies in United States, Europe, Japan and Middle East Export sales of 48% in FY23 13
Slide 15: Q2 & H1 FY24 Expansion Initiatives & Key Developments
Q2 & H1 FY24 Expansion Initiatives & Key Developments 14
Slide 16: Update on various expansion initiatives
Update on various expansion initiatives Details of expansion projects Current project updates: announced: Recent CAPEX announcements Expansion of specialty organic 29 m3 will be commissioned by chemicals capacity by 60,000 March 2024; 31 m3 commissioned Existing Business litres (60 m3) upto Q4 FY23
Slide 17: Key Developments
Key Developments Raised ~Rs. 253 crore through Preferential Allotment Successfully completed the preferential allotment of 14,42,358 equity shares of face value of Rs. 10 each at a price of Rs. 1,754.07 per share including a premium of Rs. 1,744.07 per share. Through this allotment, the Company has
Slide 18: Q2 & H1 FY24 Financial Performance
Q2 & H1 FY24 Financial Performance 17
Slide 19: Key Performance Highlights – Q2 & H1 FY24
Key Performance Highlights – Q2 & H1 FY24 Q2 FY24 H1 FY24 Q2 FY24 Revenue break-up Revenues Rs. 161.7 crore Rs. 326.6 crore *Exports, 9% 10% 31% EBITDA Rs. 25.9 crore Rs. 54.0 crore Domestic, 7% 10% *Including deemed exports 69% Profit Before Tax Rs. 11.0 crore Rs. 24.6 crore -22% -17% I
Slide 20: Financial Summary – Q2 FY24
Financial Summary – Q2 FY24 Rs. crore REVENUE • Inspite of continued external pressures like global inventory destocking, slowdown in key export markets and geopolitical uncertainties, the Company was able to sustain its revenue momentum 9% Q2 FY24 161.7 • Consistent topline performance can be attri
Slide 21: Revenue break-up – Q2 & H1 FY24
Revenue break-up – Q2 & H1 FY24 Q2 FY23 Rs. 99 crore Q2 FY24 Rs. 124 crore 24% Organic Chemicals H1 FY23 Rs. 189 crore H1 FY24 Rs. 244 crore 29% Q2 FY23 Rs. 49 crore Q2 FY24 Rs. 39 crore -21% Inorganic Chemicals H1 FY23 Rs. 107 crore H1 FY24 Rs. 83 crore -23% Decline in revenues in Inorganic
Slide 22: Financial Table – Profit & Loss Statement (Consolidated)
Financial Table – Profit & Loss Statement (Consolidated) Particulars (Rs. In crore) Q2 FY24 Q2 FY23 Growth (%) H1 FY24 H1 FY23 Growth (%) Revenue 161.7 148.1 9% 326.6 296.0 10% Expenditure 135.8 123.9 10% 272.6 247.1 10% EBITDA 26 24.3 7% 54.0 48.9 10% Margins 16.0% 16.4% -34 bps 16.5% 16.5% - Depre
Slide 23: Balance Sheet Snapshot (Consolidated)
Balance Sheet Snapshot (Consolidated) Particulars (Rs. In crore) As on September 2023 As on March 2023 Assets Non-Current Assets 479.8 398.0 Current Assets 722.2 655.8 Total Assets 1,202.0 1,053.8 Liabilities Shareholders’ Funds 497.4 482.5 Non-Current Liabilities 179.9 161.5 Current Liabilities 524
Slide 24: Seasonal Variance Factors
Seasonal Variance Factors ▪ Neogen’s business has some seasonal drivers, due to which the company tends to deliver stronger financial performance in the second half of the financial year (October to March). Seasonal variance is driven by strong demand from Europe as orders tend to scale up in Octobe
Slide 25: Management Commentary
Management Commentary Commenting on the Q2 FY24 performance, Mr. Haridas Kanani, Chairman & Managing Director, at Neogen Chemicals said: “I am pleased to share that we have maintained a consistent performance despite persistent external headwinds that have adversely impacted the end-user demand. We
Slide 26: Historical Financial Trends
Historical Financial Trends Net Revenue from Operations** EBITDA (INR crore) Margin (%) (INR crore) 19.2% 19.0% 686 18.2% 17.8% 17.7% 487 336 16.3% 306 239 164 29 44 58 65 87 112 FY18 FY19 FY20 FY21 FY22 FY23 FY18 FY19 FY20 FY21 FY22 FY23 ** Revenue is Net of Excise PAT (INR crore) Margin (%) Networ
Slide 27: Industry Overview: Lithium Ion Batteries
Industry Overview: Lithium Ion Batteries 26
Slide 28: Strong Opportunities in Lithium Battery sector
Strong Opportunities in Lithium Battery sector Lithium-ion battery (3.7v) Approximate Cost Component Break up* Government Focus on “ATMANIRBHAR” • PLI scheme is expected to accelerate EV adoption • PLI Battery Scheme – Target Incentive Outlay – Rs.18,100 Crores • 60% of Battery Material to be Indige
Slide 29: Way Forward
Way Forward 28
Slide 30: Way Forward
Way Forward Increasing Custom Synthesis & Foray into sunrise sector of Lithium-Ion Contract Manufacturing portfolio Batteries Expanding production capacities Focus on operational efficiency and Focus on advanced speciality functional excellence intermediates 29
Slide 31: CSR Initiatives
CSR Initiatives 30
Slide 32: CSR Initiatives
CSR Initiatives Focus areas in CSR Rural development Education Healthcare, sanitation and Environment nutrition sustainability Conservation and management of natural resources 31
Slide 33: Contact Us
Contact Us 32
Slide 34: Contact Us – About Neogen Chemicals Limited
Contact Us About Neogen Chemicals Limited Incorporated in 1989, Neogen Chemicals Ltd. (NSE Code: NEOGEN; BSE Code: 542665) is India’s one of the leading manufacturers of Bromine-based and Lithium-based specialty chemicals. Its specialty chemicals product offerings comprises of Organic as well as Ino
Slide 35: Thank You
Thank You
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