Zuari Agro Chemicals Ltd. · NSE:ZUARI
Zuari Agro Chemicals — Investor Presentation (December 2017)
42 slides from Zuari Agro Chemicals's investor presentation, December 2017
Slide 1: Zuari Agro Chemicals Limited Investors Presentation - Dec'17
Zuari Agro Chemicals Limited Investors Presentation- Dec’17
Slide 2: Table of Contents
Table of Contents 1. Company overview 2. Industry overview 3. Key investment highlights 4. Growth strategies 5. Financial and operational performance 6. Appendix 2
Slide 3: Zuari: Overview
Zuari: Overview One of India’s largest One of India’s Major Player in Water Soluble Fertilizers Phosphatic Fertilizer Company One Stop Solution for Agri Inputs with Retail Stores Strategically located plant to cater all India demands New /proposed States 3 Source: Company, ICRA
Slide 4: Evolution of the Company
Evolution of the Company Commissioning Acquired Acquired stake Demerger of the Merger of the Urea Plant Paradeep in phosphate Fertiliser undertaking approved for at Goa Phosphates Ltd. mine in Peru of Zuari Industries into three 100% Zuari Holdings Limited subsidiaries 1967 1973 1994 1995 2002 2007
Slide 5: Corporate Structure
Corporate Structure Zuari Agro Chemicals Limited (ZACL) 50% Zuari Maroc 50% Phosphates OCP Group Limited (ZMPL) 80.45% Paradeep Phosphates Limited (PPL) 53.03% 30% MCA Phosphates 70% MCFL Mitsubishi Corp. Pte Limited 30% equity stake in Fosfatos del Pacifico (Fospac), for developing a rock phosphate
Slide 6: Table of Contents
Table of Contents 1. Company overview 2. Industry overview 3. Key investment highlights 4. Growth strategies 5. Financial and operational performance 6. Appendix 6
Slide 7: India Agri Overview
India Agri Overview India is one of the fastest growing economies in the world 7.2% 7.5% 6.7% 6.5% 6.3% 6.8% 1.8% 2.1% 2.2% 1.6% 0.3% Brazil China India United States -3.6% 2016 2017E 2018E Agriculture account for 15% of GVA India has a leading position in most agri products Agriculture 15% Crop Ind
Slide 8: Indian Agri Industry Suffers From Low Productivity
Indian Agri Industry Suffers From Low Productivity Low consumption of fertilizers, coupled with low mechanization leads to low crop yields 500 421 Yield (Kg) per Paddy Wheat Maize 400 hectare 300 India 3,622 3,030 2,752 200 144 162 139 China 6,749 5,048 5,998 100 Brazil 5,201 2,209 5,176 0 India Chi
Slide 9: Multiple Reforms and Policies Which Provide Impetus to Agri Sector
Multiple Reforms and Policies Which Provide Impetus to Agri Sector GoI targeting to double farmer income by Direct Benefit Transfer 2022 Would lead to reduced working capital, increase in Higher rural incomes would be positive for agri-inputs digitization ,and better customer targeting Financial Inc
Slide 10: GoI Targeting to double farmer Income by 2022
GoI Targeting to double farmer Income by 2022 Technology to improve Integrated water use Improving productivity area cover under Biotechnology (seeds) policy irrigation Improvement in Higher crop intensity 3 crops in a year irrigation facilities GoI Targeting to double farmer HVC’s provide for farme
Slide 11: DBT – Overview and Key Benefits
DBT – Overview and Key Benefits DBT – Overview Subsidy disbursement Dept of Purchase info to manufacturer Fertilizers Triggered Manufacturer Retailer PoS Transaction Farmer DBT – Key Benefits • Subsidy to manufacturer would be paid on a weekly basis • More informed farmers is expected to result in i
Slide 12: Other Reforms and Policies
Other Reforms and Policies • Balanced use of fertilizers Soil Health Card o GOI has issued ~98 mn soil health cards till Nov 2017 Financial • Farmers entering mainstream economy Inclusion • Key initiatives/target of the policy includes (Pradhan o Bank Account for each household Mantri Jan o Crop Ins
Slide 13: Subsidy Reform in NPK/DAP Fertilizers
Subsidy Reform in NPK/DAP Fertilizers Share of subsidy in realization has declined over the last 5 years on account of decontrol in NPK/DAP in ZACL 34% 34% 32% 29% 38% 50% 66% 66% 68% 71% 62% 50% FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 % share of Avg. MRP of Mfg Complex Fertilizers % of Avg.
Slide 14: Declining Imports in Fertilizers
Declining Imports in Fertilizers (Mn Tons) 22.4 18.4 17.1 15.9 15.4 11.8 14.2 Phosphate 9.8 12.2 12.2 9.6 10.5 11.3 10.6 6.5 6.1 3.7 4.1 6.2 4.9 3.1 FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 H1 FY18 Imports Production (Mn Tons) 29.8 30.6 29.8 31.3 33.0 29.7 22.0 22.6 22.6 24.5 22.7 24.2 14.7 U
Slide 15: Table of Contents
Table of Contents 1. Company overview 2. Industry overview 3. Key investment highlights 4. Growth strategies 5. Financial and operational performance 6. Appendix 15
Slide 16: Key Investment Highlights
Key Investment Highlights 1 • Diversified product portfolio with focus on DAP/NPK Complex fertilizers o Zuari product portfolio consists of diverse nutrients o Higher pricing flexibility in DAP/NPK compared to Urea 2 • Strategically located manufacturing facilities, with long standing tie-ups for ra
Slide 17: Diversified Product Portfolio With a Focus on DAP/NPK Complex Fertilizers
1 Diversified Product Portfolio With a Focus on DAP/NPK Complex Fertilizers Key capacities (ktpa) Water 1 Particulars DAP/NPK Urea SSP SNF ABC Zypmite Total Solubles ZACL 860 399 200 24 1,483 Paradeep 1,300 60 1,360 MCFL 260 380 21 12 18 691 Total 2,420 779 200 21 36 18 60 3,534 Sales volume by prod
Slide 18: Strategically Located Manufacturing Facilities, With Strong Tie-ups For Raw Material Sourcing
2 Strategically Located Manufacturing Facilities, With Strong Tie-ups For Raw Material Sourcing Strategically located manufacturing facilities Key agreements raw material sourcing Material Key Suppliers Mahad and Baramati • SSP: 200 ktpa Goa • Water Soluble: 24 ktpa Long term agreement with OCP S.A.
Slide 19: Strong Marketing & Distribution Network (1/3)
3 Strong Marketing & Distribution Network (1/3) Key brands of Zuari and geographic reach Pan-India distribution network with strong farmer connect • Strong pan India network, which provides access to key growth markets o Over ~8,000 dealers and ~75,000 sub-dealers, providing access to ~23 mn farmers
Slide 20: Strong Marketing & Distribution Network (2/3)
3 Strong Marketing & Distribution Network (2/3) Jai Kisaan Junction Store format • Direct relationship with farmers • One stop solution to farm needs • Large Agri-input basket Concept • Parallel marketing network • Platform for new product/ services launch such as Bio-fertilizers and • Customer rete
Slide 21: Strong Marketing & Distribution Network (3/3)
3 Strong Marketing & Distribution Network (3/3) Jai Kisaan Junction Road Map 21 Source: Company
Slide 22: Zuari To Benefit From Structural Reforms in the Sector
4 Zuari To Benefit From Structural Reforms in the Sector 1 GoI targeting to double farmer income by 2022 Higher rural incomes would be positive for agri-inputs 2 Direct Benefit Transfer Would lead to reduced working capital, increase digitization ,and better customer targeting 3 Financial Inclusion
Slide 23: Strong Parentage Coupled With Experienced Leadership Team (1/2)
5 Strong Parentage Coupled With Experienced Leadership Team (1/2) Promoter group Saroj Poddar • The Adventz Group is headed by Mr S K Poddar. Mr. Poddar was also instrumental in promoting Chairman Gillette India Ltd., a venture with the renowned ‘The Gillette Company,’ USA and was its Founder Chairm
Slide 24: Strong Parentage Coupled With Experienced Leadership Team (2/2)
5 Strong Parentage Coupled With Experienced Leadership Team (2/2) P.K. Gandhi, Group President, • Mr. Gandhi post-graduated in Personnel Management from Xavier Institute of Social Service, Human Resources Ranchi in 1977.He has worked for organizations such as Tata Steel, Bechtel and Punj Lloyd Ltd.
Slide 25: Table of Contents
Table of Contents 1. Company overview 2. Industry overview 3. Key investment highlights 4. Growth strategies 5. Financial and operational performance 6. Appendix 25
Slide 26: Growth Strategies
Growth Strategies 1 Modernization and capacity increase of Urea plant of ZACL 7 Increasing operational • Zuari is undertaking a ~Rs 1,350 Cr project to increase the 2 Increase footprint of efficiencies energy efficiency of its Ammonia/Urea plant in Goa “Jai Kisaan Junction” • As part of the project,
Slide 27: Table of Contents
Table of Contents 1. Company overview 2. Industry overview 3. Key investment highlights 4. Growth strategies 5. Financial & Operational Performance 6. Appendix 27
Slide 28: Financial Overview FY15 - H1 FY18
Financial Overview FY15 - H1 FY 18 Sales Volume (mn tons) Revenue from Operations (Rs Cr) 5.0 15,000 13,061 4.1 12,243 3.9 4.0 3.5 2,982 10,131 1.1 2,577 0.8 1.1 10,000 3.0 2,502 2.0 4,159 4,798 5,364 2.0 1.3 1.5 1.3 0.5 5,000 3,697 1,399 1.0 0.7 5,508 1,944 1.5 1.5 1.5 5,280 3,932 0.8 2,021 0.0 0 F
Slide 29: Zuari Agro Chemicals Limited - Consolidated Profit and Loss
Zuari Agro Chemicals Limited- Consolidated Profit and Loss INR Crores Audited Consolidated For the year For the year ended ended Particulars 31 March 2017 31 March 2016 REVENUE Revenue From Operations 6,415 7,641 Other Income 76 62 Total Revenue 6,492 7,703 EXPENSES Cost of Raw Materials Consumed 2,
Slide 30: Zuari Agro Chemicals Limited - Consolidated Balance Sheet
Zuari Agro Chemicals Limited- Consolidated Balance Sheet INR Crores Audited Consolidated Balance Sheet Particulars Mar'17 Mar'16 Non Current Assets Property, Plant and Equipment 1,663.0 1,679.9 Capital work-in-progress 142.8 102.0 Other Intangible Assets 149.1 152.7 Financials Assets 890.1 904.9 Oth
Slide 31: Table of Contents
Table of Contents 1. Company overview 2. Industry overview 3. Key investment highlights 4. Growth strategies 5. Financial and operational performance 6. Appendix 31
Slide 32: Zuari Agro Chemicals Limited - Standalone Profit & Loss
Zuari Agro Chemicals Limited- Standalone Profit & Loss INR Crores Particulars H1 FY 2018 FY 2017 FY 2016 FY 2015 REVENUE Revenue From Operations 2020.8 3,932.5 5,280.1 5,523.7 Other Income 68.2 130.2 130.4 48.7 Total Revenue 2,089.0 4,062.7 5,410.5 5,572.4 EXPENSES Cost of Raw Materials Consumed 956
Slide 33: Zuari Agro Chemicals Limited - Standalone Balance Sheet
Zuari Agro Chemicals Limited- Standalone Balance Sheet INR Crores Particulars H1 FY 2018 FY 2017 FY 2016 FY 2015 Non Current Assets Property, Plant and Equipment 403.4 372.6 367.5 264.7 Capital work-in-progress 106.9 129.2 88.8 97.8 Intangible Assets 1.9 1.7 2.1 1.3 Financials Assets 971.2 764.0 865
Slide 34: Paradeep Phosphates Limited - Standalone Profit & Loss
Paradeep Phosphates Limited-Standalone Profit & Loss INR Crores Particulars H1 FY 2018 FY 2017 FY 2016 FY 2015 REVENUE Revenue From Operations 1943.8 3696.7 4798.4 4,185.2 Other Income 11.4 52.6 39.2 87.2 Total Revenue 1955.2 3749.4 4837.5 4,272.3 EXPENSES Cost of Raw Materials Consumed 1116.3 2219.
Slide 35: Paradeep Phosphates Limited - Standalone Balance Sheet
Paradeep Phosphates Limited-Standalone Balance Sheet INR Crores Particulars H1 FY 2018 FY 2017 FY 2016 FY 2015 Non Current Assets Property, Plant and Equipment 906.2 931.4 954.0 362.7 Capital work-in-progress 297.4 243.2 150.4 524.3 Intangible Assets 1.3 1.1 1.0 1.6 Financials Assets 7.8 7.8 13.0 53
Slide 36: Mangalore Chemicals & Fertilizers Limited - Standalone Profit & Loss
Mangalore Chemicals & Fertilizers Limited- Standalone Profit & Loss INR Crores Particulars H1 FY 2018 FY 2017 FY 2016 FY 2015 REVENUE Revenue From Operations 1399.1 2,502.1 2,982.1 2,588.0 Other Income 1.9 9.7 6.3 11.5 Total Revenue 1401.0 2,511.9 2,988.4 2,599.5 EXPENSES Cost of Raw Materials Consu
Slide 37: Mangalore Chemicals & Fertilizers Limited - Standalone Balance Sheet
Mangalore Chemicals & Fertilizers Limited-Standalone Balance Sheet INR Crores Particulars H1 FY 2018 FY 2017 FY 2016 FY 2015 Non Current Assets Property, Plant and Equipment 617.4 624.7 642.5 619.4 Capital work-in-progress 10.9 13.6 13.2 9.3 Intangible Assets 0.7 0.3 0.4 0.2 Financials Assets 6.2 6.
Slide 38: Zuari Fertilisers & Chemicals Limited - Standalone Profit & Loss
Zuari Fertilisers & Chemicals Limited- Standalone Profit & Loss INR Crores Particulars H1 FY 2018 FY 2017 FY 2016 FY 2015 REVENUE Revenue From Operations 27.7 45.3 45.0 Other Income 1.9 3.8 7.7 6.3 Total Revenue 29.6 49.1 52.7 6.3 EXPENSES Cost of Raw Materials Consumed 19.5 28.9 22.3 Purchases of S
Slide 39: Zuari Fertilisers & Chemicals Limited - Standalone Balance Sheet
Zuari Fertilisers & Chemicals Limited- Standalone Balance Sheet INR Crores Particulars H1 FY 2018 FY 2017 FY 2016 FY 2015 Non Current Assets Property, Plant and Equipment 77.3 78.8 81.7 7.5 Capital work-in-progress - - - 68.2 Intangible Assets - - - - Financials Assets 535.3 535.3 535.3 147.6 Other
Slide 40: Shareholding Pattern
Shareholding Pattern Bodies Corporate Others 11.1% 1.2% Retail 11.1% Institutions 10.5% Promoters 66.1% Source: BSE; Shareholding as of 30 Sep 2017
Slide 41: Disclaimer
Disclaimer The information contained in this presentation has been prepared by Zuari Agro Chemicals Limited (the “Company”) solely for your reference and may not be distributed, copied, reproduced, or redistributed or passed on directly or indirectly to any other person, whether within or outside yo
Slide 42: Thank You
Thank You
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