Star Cement Ltd. · NSE:STARCEMENT
Star Cement — Investor Presentation (September 2020)
34 slides from Star Cement's investor presentation, September 2020
Slide 1: Exchange filing cover letter: Investor Presentation
Date:- 05.09.2020 The Listing Department, National Stock Exchange of India Limited Exchange Plaza, C-1, Block-G Bandra Kurla complex, Bandra-East Mumbai-400 051 Stock code: STARCEMENT BSE Limited Phiroze Jeejeebhoy Towers Dalal Street Mumbai-400 001 Stock code: 540575 Dear Sir, Subject: Investor Pre
Slide 2: Star Cement Limited Investor Presentation
Star Cement Limited (SCL) Investor Presentation Cementing growth. Branding success. BSE Scrip code: 540575 NSE Scrip code: STARCEMENT Sep 2020
Slide 3: Disclaimer
Disclaimer The information contained in this presentation is only current as of its date. All actions and statements made herein or otherwise shall be subject to the applicable laws and regulations as amended from time to time. There is no representation that all information relating to the context
Slide 4: We are expanding the growth horizon and creating a differential
From North GrowthEast to East to Efficiencies From Commodity to Brand From Leveraged to Debt-Free From Capacities to Capabilities We are expanding the growth horizon and creating a differential. 02
Slide 5: The Birth of a Star
The Birth of a Star 2001 The Star was born 2005 Operations commenced Largest Cement manufacturer in NER Emerging market player In Eastern India (WB & Bihar) Strategically located Cement Manufacturing Facilities Cement Business operates under SCL & its subsidiaries Star Anti-Rust Cement
Slide 6: Counting the Stars
Counting the Stars ₹ 2238+ ₹ 1841 Crores Crores Largest private Revenue from sector investment operations in in North Eastern Region FY 2019 -20 (NER) $ Highest Market share in NER – biggest pie in the region 10 States Presence $ ~ ₹ 359+ Crores Cash and Cash equivalents $ NER – North Eastern Region
Slide 7: The Star Bandwidth
The Star Bandwidth 33.22% 66.78% Public Star Cement Ltd. (Formerly Cement Promoters Manufacturing Company Ltd.) (‘SCL’) 100% 51% 87.5% 12.5% Megha Technical & Engineers Star Cement Meghalaya Ltd. Meghalaya Power Ltd. Pvt. Ltd. (‘MTEPL’) (‘SCML’) (‘MPL’) 05
Slide 8: Strong NER Roots
Strong NER Roots Promoters have strong links with NER - a crucial factor behind SCL’s success Mr. Sajjan Bhajanka, Mr. Rajendra Mr. Sanjay Agarwal, Mr. Prem Kumar Chamaria, Bhajanka, Chairman & Managing Managing Director Director Vice Chairman & Director Managing Director Experience Experience Gradu
Slide 9: Professional Management
Professional Management Key Management personnel running the organization in a very professional manner Mr. Pankaj Kejriwal, Mr. Sanjay Kr. Gupta, Mr. Manoj Agarwal, Mr. G.M. Krishna, Director Chief Executive Officer Chief Financial Officer Chief Manufacturing Officer Education Education & Experienc
Slide 10: Journey of a Star
Journey of a Star Cumulative capacities at the end of financial years Clinker (MMT) FY 10-11 FY 18-19 FY 04-05 FY 07-08 0.80 FY 12-13 2.80 0.40 0.60 2.60 Cement (MMT) FY 07-08 FY 16-17 FY 04-05 FY 12-13 4.30 1.06 0.40 3.00 FY 10-11 FY 15-16 1.27 3.70 FY 12-13 FY 14-15 Power (MW) FY 09-10 30 8 51 08
Slide 11: What Makes Star Cement Tick?
What Makes Star Cement Tick? Dependable Strategic Location, Well-established Adequate plant raw material Beneficiaries of brand in NER with Proximity to Raw capacities to cater source and easy fiscal incentives strong consumer Materials & Market to the market availability of focus in WB & BH power S
Slide 12: Location Advantage: The Game Changer
Location Advantage: The Game Changer Arunachal Pradesh Sikkim Itanagar Gangtok 110 kms Siliguri Dispur Assam Nagaland (Guwahati) 220 km Kohima Patna Shillong Our strategically located Bihar Meghalaya plants cater to the Imphal Eastern & North Eastern Manipur Regions, giving us strong customer Aizawl
Slide 13: The Star Logistics Edge
The Star Logistics Edge Limestone mines are located within 2-3 kms of our plants, providing strong raw material linkage, easy accessibility and uninterrupted supply of raw material When compared to peers, our strategically located plants cater to the Eastern & North Eastern Regions, helping us o
Slide 14: The Star Logistics Edge
The Star Logistics Edge Untapped NER and Eastern markets have strong potential for further growth Over the last few years, cement arrivals in NER from mainland players has come down to 16% from 30% - owing to strong location advantage for the existing players in NER Strong entry barriers for n
Slide 15: The Star Fiscal Edge: Financial Incentives
The Star Fiscal Edge: Financial Incentives SCL’s plants enjoy the following fiscal benefits granted by the Government Exemption Balance Exemption period** SCML SCL-GGU SCL-LMS MPL 100% under Section 80 Income Tax IE, subject to MAT ≈ 2 years ≈ 2 years - ≈ 3 years IGST / CGST on Clinker 29% / 58% ≈ 3
Slide 16: The Mark of a Star: Branding Success
The Mark of a Star: Branding Success For Star, cement is not merely a commodity and therefore, we do not sell cement, rather we build and sell brands Star as a Brand have a very high recall value, enabling repeat customers Star Cement is the most preferred brand in NER and is witnessing consis
Slide 17: Awards and Accolades
Awards and Accolades Award for the highest Supply Chain & Logistics ET NOW – “CSR Leadership Excellence (SCALE) Award Corporate Tax Payer (Non- ZEE Business “Emerging Award 2019” in 2019 - Confederation of Indian Company of the Year FY 2017- PSUs) in NER in one of our Manufacturing Industry (CII) In
Slide 18: The Star Shines Bright and Strong
The Star Shines Bright and Strong Enjoys a leadership position in the North East with market share of more than 23% Gradually increasing share in the Eastern region through concerted efforts Strong dealer and distributor network built over the years, steering year-on-year growth, enabling lead
Slide 19: Marketing the Star Brand
Marketing the Star Brand Innovative strategy, large distribution network, pioneering initiatives Pioneers in initiating distribution through direct network, i.e. Dealers rather than C&F agents in NER Building the Brand aggressively and innovatively in the markets of West Bengal & Bihar Consume
Slide 20: Marketing the Star Brand
Marketing the Star Brand Innovative strategy, large distribution network, digital initiatives Technical assistance to retail consumers to ensure better connect - drives demand and builds brand confidence Value-enhancing technical marketing for customers On-site technical support to customers thr
Slide 21: Retail-driven Marketing strategy
Retail-driven Marketing strategy Distribution network spread across 10 states Distribution Network While our peers adopted the wholesaler Retailers >9,000 model, we have built on our strong network Dealers >2,100 of partners over the last decade The result – Deeper penetration, greater Robust
Slide 22: Opportunities Beckon... and Star's Journey Continues
Opportunities Beckon… and Star’s Journey Continues 20
Slide 23: East India: Huge Untapped Potential
East India: Huge Untapped Potential Total Capacity (MMT) Total Production (MMT) and capacity utilization (%) 80 72 74 60 100 70 66 50 95 50 48 58 44.3 90 60 53 41 49 85 37 38.7 85 50 45 40 84 36 43 31 33 80 80 37 29 76 40 34 30 77 73 75 71 30 67 67 67 70 20 20 65 10 60 10 55 0 0 50 FY 10FY 11FY 12FY
Slide 24: East India: Huge Untapped Potential
East India: Huge Untapped Potential Per capita cement consumption in East is the lowest, Per Capita cement thus underlining huge potential for growth consumption (kgs) North Housing shortage in Urban India - Of the total housing Housing shortage in Urban & Rural shortages in urban India, East alone
Slide 25: North East Region: An Expanding Opportunity Landscape
North East Region: An Expanding Opportunity Landscape 8 states with abundant Separate Ministry for the Region – Natural Resources Doner (Development of North Eastern Region) to Limestone, Coal, Dolomite, Quartz, Granite, Sandstone, Shale boost development Central government’s infrastructure developm
Slide 26: North East Region: Opportunities Galore
North East Region: Opportunities Galore 12 11 11.3 11.3 11.3 11.3 11.3 Five-year 2007- 2012- 2017- 10 Plans 2012 2017 2022 10 9 9.4 8.8 NER Cement 7.9 Capacity (Mn 8 7 7 7.1 7.2 6.3 6.6 Tons) NER GDP 5.8 6.0 10% 13.7% 16.4% 6 5.4 Growth NER Cement 4 Demand (Mn Tons) NER Per 2 Capita 8.6% 12.4% 15.2%
Slide 27: The Star is Set to Shine Brighter: More Frontiers of Growth
The Star is Set to Shine Brighter: More Frontiers of Growth Further growth in high potential areas by leveraging operational and financial efficiencies Seize the growth opportunities in NER, Eastern Region – partner the government's initiatives to boost infrastructure Strengthen and expand dea
Slide 28: The Numbers Speak: Successful Financial Track Record
The Numbers Speak: Successful Financial Track Record In ₹ Crores 2016-17 2017-18 2018-19 2019-20 Q1 FY 19-20 Q1 FY 20-21 Net Operating Revenue 1,552 1,629 1,826 1,841 460 292 C O N S O L I D AT E D F I N A N C I A L S EBIDTA 411 526 455 424 119 71 EBIDTA Margin (%) 26.89% 32.56% 24.90% 23.02% 26.00%
Slide 29: Performance Anatomy
Performance Anatomy Net Revenue (Rs Crs) PAT (Rs Crs) - 37% -49% 84 460 292 43 Q1 FY 19-20 Q1 FY 20-21 Q1 FY 19-20 Q1 FY 20-21 Due to COVID 19 outbreak and resultant lock down country wide Sales volume & PAT reduced. 06 27
Slide 30: Performance Anatomy
Performance Anatomy Power & Fuel cost (Rs/ MT) Freight & Forwarding Cost (Rs /MT) +0.6% -6% 1121 1128 1270 1195 Q1 FY 19-20 Q1 FY 20-21 YTD FY 19 YTD FY 20 • No major variance 28
Slide 31: CSR – Assam, Meghalaya & West Bengal
CSR – Assam, Meghalaya & West Bengal HEALTH & SANITATION ❖ Drinking water project is benefiting around 15000 people in a week in Lumshnong area. ❖ Drinking water system was installed 9 LP schools of Mohit Nagar area and renovation of toilets in 5 toilets is about to complete. ❖ A public toilet is un
Slide 32: CSR – Assam, Meghalaya & West Bengal
CSR – Assam, Meghalaya & West Bengal EDUCATION Star Cement is being awarded as runners up for Integrated Livelihood & Skill Building ❖ Books, copies and other stationary items were distributed to all 61 programme by 7th Enabling students of Shyam Sishu Mandir School so that the students may North-Ea
Slide 33: Covid Related Actions
Covid Related Actions Routine Hygiene and Cleanliness V Body temperature screening of Touch free (Foot operated) hand Cleaning of all Washroom, All inbound vehicles / every individual before each washing basins installed at Toilet, Wash- Basin, and machineries disinfected on gate entry/ exit. vari
Slide 34: Thank You
Thank You Mr. Sanjay Kr. Gupta investors@starcement.co.in www.starcement.co.in