Carborundum Universal Limited · NSE:CARBORUNIV
Carborundum Universal — Investor Presentation (February 2019)
60 slides from Carborundum Universal's investor presentation, February 2019
Slide 1: Investor Presentation
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Slide 2: Disclaimer
DISCLAIMER The communication may contain statements relating to future business developments, company’s performance and economic performance that may constitute ‘forward looking statements’. While these forward looking statements represent the company’s judgments and future expectations, a number of
Slide 3: Murugappa Group: An Overview
Murugappa Group An Overview CUMI @ 2015 3
Slide 4: Murugappa Group
MURUGAPPA GROUP INR 269 Billion Conglomerate One of the largest family promoted, professionally managed, diversified business groups CUMI @ 2015 4
Slide 5: The Philosophy we cherish
The Philosophy we cherish The fundamental principle of economic activity is that No man you transact with will lose; then you shall not. CUMI @ 2015 5
Slide 6: Murugappa Group Today
Murugappa Group Today ~ INR 269 Billion Conglomerate One of the largest family promoted, professionally managed, diversified business Groups… CUMI @ 2015 6
Slide 7: The Spirit of the Murugappa Group
The Spirit of the Murugappa Group CUMI @ 2015 7
Slide 8: Social Responsibility
Social Responsibility AMM Foundation is a non-profit organization run by the Murugappa Group 1% of PAT from Group companies to AMM Foundation 4 Schools, a polytechnic; approximately 10,500 students 4 Hospitals - around 8.15 lakh patients treated last year Scholarships for needy meritorious students
Slide 9: Carborundum Universal
Carborundum Universal CUMI @ 2015 9
Slide 10: Birth Of CUMI
Birth Of CUMI • Incorporated as a joint venture 1954 between Carborundum Company USA, Universal Grinding Wheel Company, UK and the Murugappa, CARBORUNDUM UNIVERSAL India USA UK • Acquired a coated abrasives facility from Ajax products Pvt Ltd • Bonded abrasives facility set up in Chennai India CUMI
Slide 11: Business Portfolio
Business Portfolio PBIT Share Sales Share CUMI – FY 15 Revenue :Rs. 20.2 bn EBIT :Rs. 1.9 bn Capital Employed :Rs. 14.9 bn Abrasives Ceramics Electro-minerals Revenue : Rs 8.6 bn Revenue : Rs 4.8 bn Revenue : Rs 7.3bn EBIT : Rs 0.6 bn EBIT : Rs 0.7 bn EBIT : Rs 0.8bn Capital Employed : Rs 5.5 bn Cap
Slide 12: CUMI Consolidated
CUMI Consolidated – Exports its products to 50 countries – Over 20,000 varieties of Products – 29 manufacturing locations – 7 countries – Over 5000+employees – 2100+ outside India – Consolidated Gross Sales Rs 2131 cr (FY 14-15 ) – Market Cap~ Rs. 3500 cr CUMI @ 2015 12
Slide 13: CUMI World Wide - By Business Verticals
CUMI World Wide- By Business Verticals RUSSIA Abrasives Ceramics Electro minerals USA CHINA Abrasives Abrasives Ceramics THAILAND Abrasives S. AFRICA EUROPE UAE INDIA AUSTRALIA Foskor Zirconia Electro Minerals Abrasives Abrasives Abrasives Ceramics Electro minerals Ceramics Electro minerals Abrasive
Slide 14: Vision / Mission
OUR VISION/MISSION We will be an Admired Company in VISION Abrasives & Technical Ceramics, driven by Innovation, to create Stakeholder Wealth. MISSION Become one of the largest Abrasives (including Super Abrasives) / Technical Ceramics in the Company in the World by 2020. CUMI @ 2015 14
Slide 15: Abrasives
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Slide 16: Abrasives – Products & Application
ABRASIVES – Products & Application Bonded Products and other applications …. For Rough Grinding and Cutting applications:- General Engineering Fabrication Foundry and other applications …. Rolling Mills Projects Thin Wheels and other applications …. Coated Products CUMI @ 2015 16
Slide 17: Abrasives – Products & Application
ABRASIVES – Products & Application and other applications …. Wood working Metal working Construction Power Tools Rotary Tools Creep Feed grinding Cutting Tool industries Notch and Slot grinding Printing and Paper Roll grinding Tungsten Carbide Roll grinding and other applications …. Ceramic and Tile
Slide 18: Abrasives – Facilities
ABRASIVES – Facilities Manufacturing Marketing & Distribution Thiruvottriyur, Chennai Hosur, Tamil Nadu Sriperumbudur, Chennai Uttarkhand CUMI Middle East India VAW, Russia CACCL, China Overseas Venlo Netherlands CUMI USA Wendt, India Wendt, Thailand/CME Sterling Abrasives, Gujarat Subs / JV’s CUMI
Slide 19: Abrasives – Performance
ABRASIVES – Performance Rs. Mil Consolidated Net Sales - Annual -2.5% 0% 6.3% +18.7% +26.7% + 6.4% +3.6% + 29% + 24.7% % sales in India 87% 83% 75% 70% 78% 74% 74% 74% 73% 77% CUMI @ 2015 19
Slide 20: Opportunities for CUMI Abrasives
Opportunities for CUMI Abrasives Infrastructure 100 smart cities across India Steel Industry – Roll Grinding wheels Fabrication – Thin wheel Freight corridor, Industrial Corridor Sagar mala - connectivity to the Port Gas Grids Auto & Auto Components – Crank/ Auto Refinishing – Coated Cam National Op
Slide 21: Opportunities for CUMI Abrasives
Opportunities for CUMI Abrasives Energy Scarcity Oil-1 mbpd to be added Gas – 135 bcm to be added 1000 TeraWh to be added Thermal / Nuclear will dominate Renewable energies will rise Turbine grinding Zircon alloy grinding in the nuclear energy space Fabrication Wind Mill Fabrication
Slide 22: Industrial Ceramics
Industrial Ceramics World Class Manufacturing Strong Technology Platform Global Reach Leadership Position in Key Markets CUMI @ 2015 22
Slide 23: Industrial Ceramics Product Range
INDUSTRIAL CERAMICS Product Range Wear Ceramics Technical Ceramics Grinding Wear Ceramic Engineered Ceramics Metallized Ceramics Media Resistant Lined Liners Equipment Applications Applications • Bulk Material Handling • Fluid Handling • Ceramic Tile/Mineral • Battery Tooling Processing • Ignition S
Slide 24: Industrial Ceramics – Move up Value Chain
INDUSTRIAL CERAMICS – Move up Value Chain • Currently we are in the business of Alumina based Ceramics. We constantly look at Products Competing Criteria extending offerings in that range and target newer industries. Technology, Process Metz Cylinders Capability Moving up the value chain • Move up t
Slide 25: Our Strengths
Our Strengths… A Global Leader in Wear Protection Solutions State of art Ceramic Material Preparation Automation, Process Control & TPM Application Engineering & Design Customized Engineered & Metallized Ceramics ISO, EMS & OSHAS Certified CUMI @ 2015 25
Slide 26: Impact of Megatrends
Impact of Megatrends Infrastructure Mining Power Generation • Wear Protection Urbanisation • Metallized Cylinders Power Transmission CUMI @ 2015 26
Slide 27: Impact of Megatrends
Impact of Megatrends Global Rebalancing Manufacturing • Wear Protection • Metallized Cylinders Emergence of • Engineered Ceramics Affluent Healthcare CUMI @ 2015 27
Slide 28: Super Refractories
SUPER REFRACTORIES CUMI @ 2015 28
Slide 29: Super Refractories – Product Range
SUPER REFRACTORIES– Product Range CUMI Refractory Products Fired products Monolithics Precast Shapes Conventional Silicon Carbide Dense (CUMIFRAC) Castables (CUMICRETE) Insulation Nitride bonded Castables Silicon Carbide (CUMICRETE Light Weight) Low cement Mulite (CUMILITE) castables (CUMIHICAST & C
Slide 30: Super Refractories
SUPER REFRACTORIES • Refractory is any material that can withstand high temperature. CUMI is into High Alumina, Silicon Carbide, Zirconia based refractories which are capable to withstand very high temperature:- − Fired Refractories: Is a block of refractory ceramic material used in lining furnaces,
Slide 31: Super Refractories - Application
SUPER REFRACTORIES - Application Ceramic Industries Chemical Process Industries Non – Ferrous Insulators Carbon Black Aluminum Sanitaryware & Tableware Fertilizer Copper Abrasives Petro-Chem. / Refinery Zinc Wall Tiles Refractories Cement Iron & Steel Electro Ceramics Power Generation Sponge Iron (D
Slide 32: Super Refractories: Complex Shapes Capability
SUPER REFRACTORIES Ability to manufacture complex shapes and meet all surge requirements CUMI @ 2015 32
Slide 33: Roof Sheet for Chennai Metro
Roof Sheet for Chennai Metro FRP Roof sheets were required to shield the high voltage metro lines from interfering with flight path near the Chennai Airport Roof sheets made in specified Red & White colours by Prodorite-CUMI; Installation completed by Chennai Metro CUMI @ 2015 33
Slide 34: Opportunities for CUMI Ceramics (IC+SR)
Opportunities for CUMI CERAMICS (IC+SR) Coal Washeries Ceramics for Steel Reheat/ Heat Treatment Forging Furnaces Annealing Process Gas Heaters Glass Melting Furnace Gunning CUMI @ 2015 34
Slide 35: Opportunities for CUMI Ceramics (IC+SR)
Opportunities for CUMI Ceramics (IC+SR) HRSG High Alumina Ceramics for Renewable Energy Super Critical Turbines Passive Fire Protection Ceramics for SOFC Gasification Projects FGD Systems CFBC Boilers CUMI @ 2015 35
Slide 36: Ceramics – Performance
CERAMICS (Industrial Ceramics and Refractories)- Performance Rs. Mil Net Sales - Annual +9.3% -5.7% +2.3% + 31% + 21% + 11.1% + 26.8% + 17.4% +20.4% % sales in India 44% 43% 53% 54% 53% 56% 62% 55% 55% 60% CUMI @ 2015 36
Slide 37: Electro Minerals
ELECTRO MINERALS CUMI @ 2015 37
Slide 38: Electrominerals – Product Range
ELECTROMINERALS – Product Range Brown Fused Alumina White Fused Alumina Silicon carbide Zirconia Specialty minerals Bonded Refractory Silicon wafer Diesel Abrasives slicing Particulate Filter Coated Metallurgical Investment Floor Abrasives casting Laminates Surface Engineering Refractories Energy &
Slide 39: Electrominerals - Application
ELECTROMINERALS - Application Refractory Bonded Abrasives Coated Abrasives Dermabrasion Semi Conductor Lapping Laminates Pressure Blasting Photovoltaic Plasma Spray Particulate Filters Metalurgical CUMI @ 2015 39
Slide 40: Electrominerals – Facility
ELECTROMINERALS – Facility 1 2 1 Bauxite mines & calcination 3 4 2 Silicon carbide, 5400 tpa 3 Fine powders, 7200 tpa 5 4 Fused alumina ~24000 tpa 5 12 MW Hydel power, Maniyar CUMI @ 2015 40
Slide 41: Electrominerals – Overseas Facility
ELECTROMINERALS – Overseas Facility VAW - Russia VAW Russia – Silicon Carbide, 75,000 tpa Foskor Zirconia – Fused Thukela Refractory Foskor Zirconia Zirconia, 10,000 tpa TRI – 22k tpa fusion facility CUMI @ 2015 41
Slide 42: Fused and Synthetic Alumina at Kochi
Fused and Synthetic Alumina at Kochi CUMI @ 2015 42
Slide 43: SiC Koratty India
SiC Koratty India CUMI @ 2015 43
Slide 44: SiC VAW, Russia
SiC VAW, Russia CUMI @ 2015 44
Slide 45: Electro Minerals – Global Capacity & Our Standing
ELECTRO MINERALS – Global Capacity & Our Standing Global Capacity and Our Share • Silicon Carbide Current Standing Point − Global capacity is ~ 2 million tonnes. Price and Cost movements, macro factors, keeps these facilities either running or • Established leadership in Russian and closed. Indian m
Slide 46: Electro Minerals – Future Strategy
ELECTRO MINERALS – Future Strategy Innovation Value Pyramid CUMI @ 2015 46
Slide 47: Electro Minerals - Performance
ELECTRO MINERALS - Performance Net Sales - Annual Rs. Mil -10% -8% 21% +22% +25% +13% +97% +21.7% +15.9% % sales in India 94% 88% 40% 20% 24% 22% 21% 22% 25% 26% CUMI @ 2015 47
Slide 48: Electro Minerals – Current developments
ELECTRO MINERALS – Current developments • Shifting of Bubble plant in FZL to Cochin • Transfer of furnace in TRI to Cochin • Scale up Alumina Zirconia – add C&G plant • Set up wholly owned subsidiary in Czech Republic, Europe • To sell VAW products in Europe overcoming the Russia Ukraine tension and
Slide 49: EMD Business Opportunity
EMD Business Opportunity Environment Energy Urbanization Nuclear Energy Infrastructure Euro 6 Mobile energy Transportation Demand for water Renewable energy Housing Zirconia SiC for DPF Abrasives SiC SiC and Alumina for Refractories Graphite Filtration Thermal Powders Thermal Powders
Slide 50: Financials
murugappa FINANCIALS CUMI @ 2015 <>
Slide 51: Revenue Growth
Revenue Growth +23% -1.3% +7.8% +25% -3.6% +7.5% +31% +46% 16007 19685 19424 20939 20187 11930 12823 Rs. In Million +28% 9093 10017 4865 6210 05-06 06-07 07-08 08-09 09-10 10-11 11-12 12-13 13-14 14-15 15-16 H1 CUMI @ 2015 51
Slide 52: International Revenue Share
International Revenue share (%) 60 51 47 49 50 46 50 45 44 40 31 Percentage 30 20 13 13 10 0 05-06 06-07 07-08 08-09 09-10 10-11 11-12 12-13 13-14 14-15 CUMI @ 2015 52
Slide 53: Segmental Performance
Segmental Performance Net Sales 2015-16 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 (Rs. Mil) H1 Abrasives 3214 3880 5006 5325 5518 6990 8304 8093 8599 8590 4484 Ceramics 1130 1734 2199 2582 2871 3476 4565 4991 4707 4817 2253 Electro 681 830 2153 4245 4789 5979 72
Slide 54: Performance Ratios
Performance Ratios EBITDA % PBIT % CUMI @ 2015 54
Slide 55: Performance Ratios
Performance Ratios Debt Equity Ratio 1.02 0.85 0.74 0.57 0.46 0.37 0.41 0.41 0.31 0.30 06-07 07-08 08-09 09-10 10-11 11-12 12-13 13-14 14-15 15-16 H1 Asset Turns ROCE 1.40 1.31 1.18 1.24 1.34 1.71 1.34 1.31 1.08 1.11 24.6 27.1 17.8 16.3 18.1 21.8 12.1 11.5 12.1 17.9 06-07 07-08 08-09 09-10 10-11 11-
Slide 56: Market Performance Ratios
Market Performance Ratios Dividend Payout Ratios CUMI @ 2015 56
Slide 57: Investor Friendly Company
Investor Friendly Company • 43.66% held by the Murugappa Group, 35.98% held by FII’s, MF, PE, Insurance Cos • 61 years of unbroken track record of Profit and Dividend • Six Bonus Issues since inception – 89% of the current Equity is by way of capitalization of Reserves • Growth over the years entire
Slide 58: CUMI Center for Skill Development (CCSD)
CUMI Center for Skill Development (CCSD) CUMI @ 2015 58
Slide 59: CUMI Center for Skill Development (CCSD)
CUMI Center for Skill Development (CCSD) CCSD inducted a new batch for the new academic year. Students along with their parents attended the inaugural ceremony. CUMI @ 2015 59
Slide 60: CUMI @ 2015
oh murugappa CUMI @ 2015 <>
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