Ceat Limited · NSE:CEATLTD
Ceat — Q4 FY16 Earnings Presentation
36 slides from Ceat's earnings presentation, Apr 27, 2016
Slide 1: Q4 FY16 – Investor Presentation
An Group Company Q4 FY16 – Investor Presentation April 27th, 2016
Slide 2: Disclaimer
Disclaimer This presentation may include statements which may constitute forward-looking statements. All statements that address expectations or projections about the future, including, but not limited to, statements about the strategy for growth, business development, market position, expenditures,
Slide 3: Table of Contents
Table of Contents Section 1: RPG Group Overview 5-6 Section 2: Key Highlights 8 Section 3: Industry Overview 10-11 Section 4: Business Overview 13-26 Section 5: Operational & Financial Overview 28-36
Slide 4: Section 1: RPG Group Overview
Section 1: RPG Group Overview
Slide 5: RPG Group: Powered by Passion, Driven by Ethics
RPG Group: Powered by Passion, Driven by Ethics RPG Enterprises was founded in 1979 by Shri Rama Prasad Goenka, popularly known as RP UNLEASHTALENT Goenka, a pioneering fifth generation business leader from the Goenka family. The Goenkas TOUCHLIVES have a history of business dating back to 1820 AD i
Slide 6: RPG Group: Key Financials
RPG Group: Key Financials Net Revenue (Rs Cr) EBITDA (Rs Cr) PAT (Rs Cr) 18,593 17,614 FY11-15 CAGR: 14% 15,788 FY11-15 CAGR: 1,690 1,732 13,944 EBITDA 16% PAT 17% 1,250 10,839 1,121 943 714 795 423 429 404 FY11 FY12 FY13 FY14 FY15 FY11 FY12 FY13 FY14 FY15 16,000 Net Worth (Rs Cr) ROCE ROE Market Ca
Slide 7: Section 2: Key Highlights
Section Section 2: 2: Key Key Highlights Highlights
Slide 8: Key Highlights
Key Highlights Revenue CAGR of 10% over last 5 years Average ROE of 20% for 5 years ~25% of the additional capacity to commence operation in FY16 and Profit after Tax CAGR of 76% over last 5 expected to be fully ramped up over 18 years months from COD (Commercial Operation Date) Changing product mix
Slide 9: Section 3: Industry Overview
Section 3: Industry Overview
Slide 10: Indian Tyre Industry Overview
Indian Tyre Industry Overview Tyre Industry turnover in India is over Rs 50,000 crore Truck & Bus segment accounts for 55% of the industry’s revenues India exports ~ Rs 10,500 crore worth of Tyres Most of the investments by Indian and MNC tyre majors are geared towards Truck & Bus Radial Tyr
Slide 11: Indian Tyre Industry Overview
Indian Tyre Industry Overview Total Tyre Production (Volumes in Lakhs) MHCV (T&B) 165 165 171 157 161 84 FY 11 FY 12 FY 13 FY 14 FY 15 H1 FY 16 Passenger Car / Jeep 2 / 3 wheeler 357 760 321 317 671 633 634 277 287 591 190 396 FY 11 FY 12 FY 13 FY 14 FY 15 H1 FY 16 FY 11 FY 12 FY 13 FY 14 FY 15 H1 F
Slide 12: Section 4: Business Overview
Section Section4:4:Business BusinessOverview Overview
Slide 13: Board of Directors
Board of Directors Harsh Vardhan Goenka Anant Vardhan Goenka Arnab Banerjee Chairman, Non Executive Director Managing Director Whole -Time Director Atul C. Choksey Haigreve Khaitan Hari L. Mundra Kantikumar R. Podar Mahesh S. Gupta Non Executive Non Executive Non Executive Non Non Executive Non Exec
Slide 14: Leadership Team
Leadership Team Anant Goenka Manoj Jaiswal Arnab Banerjee Tom Thomas Managing Director Chief Financial Officer Executive Director Executive Director - Operations - Technology & Products Dilip Modak Chandrashekhar Ajgaonkar Debi Prasad Das Subbiah Kumar Senior Vice President Senior Vice President Sen
Slide 15: Overview
Overview India’s leading tyre company with over 50 yrs of presence Distribution Network : 4,000+ dealers, 390+ exclusive CEAT franchisees 6 Manufacturing facilities - Bhandup, Nasik, Halol, Nagpur, Ambernath & Sri Lanka 100+ countries where products are sold with strong brand recall #No 1 player in
Slide 16: Manufacturing Facilities
Manufacturing Facilities Overall Capacity: > 1,000 MT / day Bangladesh Halol Nagpur Nasik Bhandup Operational facilities Ambernath Hyderabad WIP Key Outsourcing facilities Calicut Manufacturing facility planned Sri Lanka 16
Slide 17: Strategic Drivers
Strategic Drivers 1 Strong Brand Recall Two wheelers Domestic Passenger cars & Utility Market vehicles 2 OEM Relationships 3 Distribution Network Profitable growth 4 Product Development International Specialty Market 5 Proven Model In Sri Lanka Emerging markets 6 Product Mix 17
Slide 18: Creating Strong Brand Equity
1 Creating Strong Brand Equity CEAT SUV CEAT Tyres Tubeless Campaign Bike Tyre - Campaign “Our Grip Your Stories” IPL Strategic Timeout Partner 18
Slide 19: Increasing OEM Presence
C=AT ORPG eo Increasing OEM Presence Lid @® == VE COMMERCIAL VEHICLES = . A VOLVO GROUP AND EIGHER MOTORS JOINT VENTURE TATA Ashok Leyland ~ mo ESCORTS : GD QD & BWAMW sare: Mahindra DAIMLER EICHER BUILT TO WIN : —~ ws TF wow pe .£ > tl SUZUKI Mahind FORCE janis MOTORS ahindra HYUNDAI RENAULT TorTee
Slide 20: Pan India Distribution Network
3 Pan India Distribution Network Distribution Network 4,000+ dealers 390+ CEAT Franchisees (Shoppes + Hubs) 270+ two-wheeler distributors District coverage No. of CEAT Shoppes 586 219 464 176 102 212 FY12 FY15 FY16 FY12 FY15 FY16 20
Slide 21: Pan India Distribution Network
3 Pan India Distribution Network Multi Brand Outlet (MBO) Shop in Shop (SIS) New distribution model Developed MBO / SIS model in the last 2 years Over 290 outlets so far 21
Slide 22: Research & Development
4 Research & Development Recent Product Launches in FY16 TBR launches PCR / UVR launches 2 wheeler launches RD 114 Milaze Fuel Smarrt CZAR Sport ZOOM PLUS Pro Gripp GRIPP XL Key OEM Approvals in FY16 22
Slide 23: Emerging Markets Trends
5 Emerging Markets Trends Revenue EBITDA1 (SLR mn) & EBITDA Margin (%) (SLR mn) 12% 17% 20% 23% 26% 4,890 1,178 4,729 1,085 4,553 4,586 978 4,357 759 532 Sri Lanka FY12 FY13 FY14 FY15 FY16 FY12 FY13 FY14 FY15 FY16 50% JV with Kelani Tyres Ltd Strong presence in the truck, light truck, 2 / 3 whee
Slide 24: Passenger Segment Trends
6 Passenger Segment Trends 1,483 2/3 wheelers (Rs Cr) PC / UV (Rs Cr) 1,246 619 561 899 476 Revenue 376 639 525 284 363 146 FY 11 FY 12 FY13 FY 14 FY 15 FY 16 FY 11 FY 12 FY13 FY 14 FY 15 FY 16 Nagpur plant commissioned 15 MT/day capacity in March 2016; total capacity of 120 MT/day Expanding Capac
Slide 25: Specialty
6 Specialty Status Update CEAT has transferred Ambernath land to CSTL in Q3 FY16 which will be used to build a new OTR (off-the- road) radial plant CSTL will invest Rs 330 Crores for an initial capacity of 40 MT/day CEAT has infused Rs 100 Crores as an equity investment in CSTL in FY16 Produ
Slide 26: Outcome
Outcome 6 yr CAGR % 12% Sales (Rs Cr) 2,850 5,508 5,705 5,681 “Strategic Focus Areas” Passenger Segment, 20% 27% Specialty Exports & 32% Emerging Markets 39% 43% Higher margin business Contributes 43% sales for YTD 80% 16 compared to 20% in FY10 Others 68% 61% 57% Higher CAGR of 27% FY 10 FY14
Slide 27: Section 5: Operational & Financial Overview
Section Section5:5:Operational Operational&&Financial Financial Overview Overview
Slide 28: Q4 FY16 Operational Highlights
Q4 FY16 Operational Highlights Ishan Kishan – OE Model Approval Bat endorsement deal Suzuki Gixxer approved, a major milestone for MCR category 28
Slide 29: Consolidated: Financial Trends
Consolidated: Financial Trends Revenue growth 5,508 5,705 5,681 5,009 4,614 3,602 Net Sales (Rs Cr) FY 11 FY 12 FY 13 FY 14 FY15 FY16 14.5% 11.9% Margin trends 11.9% 822 8.7% 658 680 EBITDA (Rs Cr) 5.9% 4.6% 438 EBITDA to 274 Net Sales % 165 FY 11 FY 12 FY 13 FY 14 FY15 FY16 Note EBITDA includes Oth
Slide 30: Consolidated: Financial Trends
Consolidated: Financial Trends 7.9% 5.6% PAT (Rs Cr) PAT trends 4.9% 446 317 PAT to Net 2.4% 271 Sales% 0.7% 0.4% 120 26 18 FY 11 FY 12 FY 13 FY 14 FY15 FY16 30% Return Ratios 25% 24% ROE (%) 16% 17% ROCE post 18% 17% 8% tax (%) 13% 7% 3% 4% FY 11 FY 12 FY 13 FY 14 FY15 FY16 Note QIP proceeds consid
Slide 31: Consolidated: Q4 FY16 Financial Highlights
Consolidated: Q4 FY16 Financial Highlights Q4 FY16 v/s Q4 FY15 (Y-o-Y) Q4FY16 v/s Q3FY16 (Q-o-Q) 8% Volume growth 7% Volume growth EBITDA% up 0.7% at 13.4% EBITDA% down 1.3% Finance cost at Rs 24 cr compared Finance cost at Rs 24 cr compared to to Rs 28 cr (down by Rs 4 Cr) Rs 19 cr (Up
Slide 32: Consolidated: Financials
Consolidated: Financials Rs cr Parameter Q4FY15 Q3FY16 Q4FY16 FY15 FY16 Net Sales 1,458 1,374 1,451 5,705 5,681 Growth (YoY) - - -0.5% - -0.4% Growth (QoQ) - - 5.6% - - EBITDA 186 202 195 680 822 Growth (YoY) - - 5.0% - 20.9% Growth (QoQ) - - -3.5% - - EBITDA (%) 12.7% 14.7% 13.4% 11.9% 14.5% PAT 94
Slide 33: Consolidated: Leverage / Coverage Profile
Consolidated: Leverage / coverage Profile Total Debt 775 736 654 725 670 (Rs Cr) 0.5 ST Debt (Rs Cr) 0.4 Debt breakup 0.3 0.4 0.3 421 398 80 LT Debt (Rs Cr) 213 254 590 512 354 400 Total Debt / Equity 338 Q4 FY 15 Q1 FY 16 Q2 FY 16 Q3 FY 16 Q4 FY 16 10.5 223 EBITDA (Rs Cr) Leverage ratios 202 202 19
Slide 34: Standalone: Q4 FY16 & FY16 Results
Standalone: Q4 FY16 & FY16 Results Rs Cr Parameter Q4FY15 Q3FY16 Q4FY16 QoQ YoY FY15 FY16 YoY Net Sales 1,409 1,321 1,383 4.7% -1.9% 5,492 5,459 -0.6% Raw Material 842 734 785 6.9% -6.8% 3,435 3,090 -10.1% Gross margin 567 587 598 1.9% 5.4% 2,057 2,369 15.2% Gross margin % 40.3% 44.4% 43.2% -120 bps
Slide 35: Equity Shareholding & Price trends
Equity Shareholding & Price trends 1,350.0 Close Price Total Volume 4,000,000 1,200.0 3,500,000 1,050.0 3,000,000 Returns since Mar’ 15 900.0 750.0 2,500,000 CEAT: 42% 2,000,000 600.0 1,500,000 Sensex: -7% 450.0 1,000,000 300.0 150.0 500,000 0.0 - Mar/15 May/15 Jul/15 Sep/15 Nov/15 Jan/16 Mar/16
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