Sutlej Textiles & Industries Ltd. · NSE:SUTLEJTEX
Sutlej Textiles & Industries — FY2018 Earnings Presentation
41 slides from Sutlej Textiles & Industries's earnings presentation, May 14, 2018
Slide 1: Cover letter to stock exchanges: Q4 and FY 2018 Results Presentation
SUTLEJ TEXTILES AND INDUSTRIES LIMITED su and industries limited Lotus Corporate Park, 'E' Wing, 5th/6th Floor, 185/A, Graham Firth Compound, Near Jay Coach, Goregaon (East), Mumbai - 400 063. Phone : (022) 4219 8800/6122 8989 Fax : (022) 4219 8830 E-mail : info@rtrnyarn.com Website : www.sutlejtext
Slide 2: Sutlej Textiles & Industries Investor Presentation May 2018
K. K. Birla Group Company Sutlej Textiles & Industries proactive and prepared... Investor Presentation | May 2018
Slide 3: Agenda
Agenda 1. Q4 & FY18 Performance 2. Sutlej at Glance 3. The 4 Pillars of Sutlej 4. Performance Ambition 5. Financial Highlights 2
Slide 4: Q4 & FY18 Performance
Q4 & FY18 Performance 3
Slide 5: Headwinds in Q4FY18 & FY18
Headwinds in Q4FY18 & FY18 Key Challenges • Q4FY18 continued to be challenging due to suppressed demand in domestic markets • Increase in raw material prices and other input costs (power) created pressure on margins • Strong rupee during the year impacted the export profitability of the textile sect
Slide 6: Q4 & FY18 Financial Highlights
Q4 & FY18 Financial Highlights Total Income (Rs Cr) EBITDA (Rs Cr) PAT (Rs Cr) 2,510 317 158 2,285 281 113 610 610 68 33 53 10 Q4 Q4 FY17 FY18 Q4 Q4 FY17 FY18 Q4 Q4 FY17 FY18 FY17 FY18 FY17 FY18 FY17 FY18 Margin remained under pressure due to:- Subdued demand in domestic markets Increase in input pr
Slide 7: Key Performance Highlights – Q4 & FY18
Key Performance Highlights – Q4 & FY18 FY18 on FY17 Revenue grown-up by 10%, the Yarn segment continues to give 95%+ of Revenue Share Yarn Sales (in MT) Up by 8% in FY18 Average Yarn Realization (Rs/kg) range bound in FY18 Export Revenue Up by 22% in FY18 at 95% utilization in spite of reduced yarn
Slide 8: Profitability Highlights
Profitability Highlights Rs. in Cr Q4FY18 Q4FY17 Q3FY18 FY18 # FY17 Income 610 610 604 2,510 2,285 Raw Material Cost 354 351 337 1,412 1,263 Employee Cost 73 70 78 303 266 Other Expenses 131 122 123 515 439 EBITDA 53 68 67 281 317 EBITDA Margin (%) 8.63% 11.07% 11.08% 11.20% 13.87% Depreciation 27 2
Slide 9: Balance sheet
Balance sheet Rs. in Cr Mar – 18# Mar – 17 Rs. in Cr Mar – 18# Mar – 17 Non-current assets 1,183 1,177 Shareholder’s Fund 907 816 Fixed assets 1,125 1,140 Share capital 16 16 Reserves & Surplus 891 800 Investments 51 28 Other Non Current assets 7 9 Non-current liabilities 555 538 Long term borrowing
Slide 10: Executive Chairman’s comments on FY18 performance
Executive Chairman’s comments on FY18 performance Commenting on the results, Mr. C.S. Nopany, Executive Chairman, Sutlej Textiles and Industries Limited said: “The fourth quarter of 2018 continued to be challenging due to suppressed demand. The strong rupee had a detrimental effect on the export via
Slide 11: Key Business Updates during the Year
Key Business Updates during the Year • Recycled PSF Plant of 80 MT/Day Capacity Setting up of Green • Expected CAPEX ~Rs 110 Crore Fibre project • Expected to be completed inQ2FY20 • Company Invested USD 4.5 Million in Wholly Owned Subsidiary in USA Home Textiles Division – • Acquired Design, Sales,
Slide 12: Key Business Updates during the Year
Key Business Updates during the Year • Invested around Rs. 60 crore during FY 18 towards technology up- gradation and debottlenecking, etc. This will result in further Modernization improvement in efficiency and sustaining plant utilization. Update • Intends to deploy further amount of Rs. 95 crore
Slide 13: Sutlej at glance
Sutlej at glance 12
Slide 14: Vision: front-runner in global textiles
Set our sights on emerging as a front- Believe in challenging our limits runner in the realm of global textiles by and overcoming them providing end to-end solutions – from yarns to home textiles Also believe that as time changes, one must evolve one’s thinking Aim to create maximum value for our cu
Slide 15: Sutlej - Marching towards growth
Sutlej - Marching towards growth India’s one of the largest Spun-dyed Yarn manufacturer Presence across value chain – from Yarn to Home Textile 4,18,680 spindles capacity of Yarn 9.6 Million Meters Per Annum capacity of Home Textiles Global Presence over 65 countries across Europe, North America, So
Slide 16: Driven by Experienced Team
Driven by Experienced Team Board of Directors Mr. C.S. Nopany Mr. U.K. Khaitan Mr. Amit Dalal Mr. Rajan Dalal Ms. Sonu Bhasin Executive Chairman Independent Independent Independent Independent Non Exec Director Non Exec Director Non Exec Director Non Exec Director Mr. Rajiv K. Podar Mr. Rohit Dhoot
Slide 17: Business Verticals
Business Verticals 95% Revenue share 5% Revenue share •India’s one of largest Spun-dyed & • Focus on Curtains & Upholstery Cotton Melange Yarn Home Textile Segment manufacturer • Capacity - 9.6 million metres Yarn Segment •4,18,680 spindles capacity • Leading producer & exporter of •Cotton Melange Y
Slide 18: Best in class facilities
Best in class facilities Location: Bhawanimandi, Rajasthan Capacity: Location: Kathua, J&K • 35,280 Spindles (Cotton Mélange ) Capacity: • 91,584 Spindles (Man –made Fibre) • 109,010 Spindles (Cotton • Roof top solar plant of 2.1 MW Mélange) • 99,430 Spindles (Man-made Fibre) Location: Daheli, Gujar
Slide 19: Marquee Clients over the Globe
Marquee Clients over the Globe 18
Slide 20: Gold Trophy as One of the Leading Export House by TEXPROCIL
Gold Trophy as One of the Leading Export House by TEXPROCIL “ We are happy to announce that Sutlej is awarded as Leading Export House by TEXPROCIL ” About TEXPROCIL: TEXPROCIL has been the international face of cotton textiles from India facilitating exports worldwide, Texprocil has a membership of
Slide 21: The Pillars of Sutlej
The 4 Pillars of Sutlej Segment Focus & Innovation Geographic Footprint Balance Sheet Integrity Continuous Reinvestment 20
Slide 22: Segment Precision and Innovation
Segment Precision and Innovation Focus on growing new Foray into market niches contemporary home textiles Value-added yarn revenues increased from 24% in FY12 to Focus on 36% in FY18 … the Company continue to focus on niche cotton innovative products to meet customer blended dyed and requirements co
Slide 23: Expanding Geographic footprint
Expanding Geographic footprint Progressively widened global footprint with presence in 65 countries Entered geographies Competitive with growing export preference for realisations value-added yarns Exports contribute ~30% to total revenue 22
Slide 24: Balance Sheet Robustness
Balance Sheet Robustness Switched from high-cost working Moderate Generate larger capital loans to Moderated gearing and capital cost of cash profits increased commercial 5.79% in FY18 reinvestment paper & packing credit (foreign currency) FY12 FY14 FY17 FY18 Total Debt to Equity (x) 2.58 1.36 1.27
Slide 25: Continuous re-investment
Continuous re-investment Graduated to Sustained Re-invested Enhanced Investments investment led non-linear depreciation efficiency by enriched product Sutlej into largest (home textiles) provision into investing in cutting- mix (superior yarns dyed yarn investments capex edge technologies and home t
Slide 26: Performance Ambition
LUTILIVIVITV IT > Lee LILIT # PUI HY Performance Ambition
Slide 27: Performance Ambition
Performance Ambition Leadership in Exploration in Explore new Organic and In- chosen segments opportunities & organic growth Sustainable Business geographies opportunities Huge addressable Model with Sustainable & market in Home continued efficient capacity Textile business innovation expansion 26
Slide 28: Sustainable & conscious capacity expansion
Sustainable & conscious capacity expansion... Yarn Spindles Capacity Home Textile Capacity 9.6 9.6 4,16,616 4,18,680 3,77,688 2,93,736 2,53,000 2,61,736 5.0 2,08,104 1,55,456 2.5 2.0 FY05 FY08 FY12 FY14 FY15 FY16 FY17 FY18 FY07 FY14 FY15 FY17 FY18 27
Slide 29: Leadership in niche segment
...led to leadership in niche segment Dyed Yarn • Leading producer of spun-dyed yarn • Sutlej’s Dyed yarn spindle Capacity 274,390 Melange Yarn • Largest producer of Melange Yarn in India • Sutlej’s Melange yarn spindle capacity 144,290 28
Slide 30: Sustainable business model
Sustainable business model... Efficient Inventory management Large & Major orders on contract basis Safe Customers Majority sales to Marquee clients - B2B business Optimum level of raw material(Cotton) Cotton Inventory of ~60 days Domestic - 70% Geographically Diversified Revenues Export - 30% Avoid
Slide 31: Foray into new growth opportunities: Green Fibre project
...Foray into new growth opportunities Green Fibre project to manufacture polyester staple fibre at Samba, Jammu and Kashmir Bottle Flake Fibre Yarn Fabric Presence of Sutlej Project details Brief rationale for the project - • Better quality fibre Capacity 29,200 MTPA/80 TPD • Sustainable supply • 1
Slide 32: Augmenting Home Textile segment
...Augmenting Home Textile segment Home Textile Revenue Break up Presence in Sales through Curtains & (Rs. In Crs) Catalogues & Upholstery in Wholesales India Distribution Domestic (%) Exports (%) network 94 108 117 26% 31% 33% Focus on export market Upgraded to fetch better design studio realizatio
Slide 33: Industry Overview
Industry Overview Indian Textile Industry Overview Indian Home Textile Industry (USD billion) Bed Linen Towels Curtains $137 bn Indian Textile sector current size 4,790 2nd Largest employment generator, Employs 45 mn people directly 7,060 50 Million spindles along with 842,000 Rotors capacity ~3,400
Slide 34: Industry outlook
Industry outlook Domestic textile & apparel industry ($ bn) Textile & apparel exports ($ bn) Total Fibre Production (Mn Kg) 141 82 9.9 58 31 6.6 2011 2021P 2011 2021P FY13 FY17P Source: Ministry of Textiles, Planning Commission, Technopak, Aranca Research Robust Demand Market Value Competitive Advan
Slide 35: Financial Highlights
Financial Highlights 34
Slide 36: Enhancing value across the years
Enhancing value across the years Revenue EBITDA PAT FY14 1,923 FY14 15.9% 306 FY14 6.8% 131 FY15 1,918 FY15 14.2% 272 FY15 6.0% 115 FY16 2,108 FY16 14.3% 302 FY16 6.8% 143 FY17 2,285 FY17 13.9% 317 FY17 6.9% 158 FY18 * 2,510 FY18* 11.2% 281 FY18 * 4.5% 113 *The Company acquired American Silk Mills,
Slide 37: Maintained low leverage despite continuous expansion
Maintained low leverage despite continuous expansion Total Debt/Equity Ratio Robust Interest Coverage Average Interest Rate of Term Loans (After TUF) FY14 1.4 FY14 4 7.5% 7.3% FY15 1.1 FY15 3.8 6.8% FY16 1.2 FY16 4.9 6.2% 6.2% FY17 1.3 FY17 5.2 FY18 1.15 FY18 4.8 FY14 FY15 FY16 FY17 FY18 36
Slide 38: Continuous re-investment helps in better earnings growth
Continuous re-investment helps in better earnings growth Gross Block (Rs Cr) Net Worth (Rs Cr) Adjusted EPS (Rs.1 per share) FY14 462 FY14 8.0 FY14 1,226 FY15 558 FY15 7.1 FY15 1,397 FY16 683 FY16 8.8 FY16 1,650 FY17 816 FY17 9.6 FY17 1,985 FY18 907 FY18 6.9 FY18 2,067 37
Slide 39: Enhancing value for Stakeholders
Enhancing value for Stakeholders Dividend Per Share (Rs) Dividend Payout (%) FY14 8 FY14 12 FY15 10 FY15 17 FY16 13 FY16 18 FY17 13 FY17 16 FY18 13 * FY18 23 * Dividend declared Rs.1.30 on FV of Rs.1 per share post split. Depiction is for visual and comparative purpose only. 38
Slide 40: Sutlej’s CSR Activities
Sutlej’s CSR Activities Health Education We regularly organise free We provide scholarships and medical camps at nearby cash awards to girl students to villages of our plant locations. promote their education, in We also extend financial aid to addition to distributing books local NGOs to promote Sw
Slide 41: Let’s Connect
Let’s Connect Mr. Bipeen Valame Mr. Vikash Verma / Mr. Abhishek Bhatt bipeenvalame@sutlejtextiles.com vikash.verma@stellar-ir.com abhishek@stellar-ir.com Lotus Corporate Park, Goregaon (East), Mumbai 400063 Kanakia Wall Street, Andheri (East), Mumbai 400 093 For more information visit: www.sutlejtex
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