Apar Industries Limited · NSE:APARINDS
Apar Industries — Investor Presentation (July 2023)
61 slides from Apar Industries's investor presentation, Jul 28, 2023
Slide 1: Stock exchange filing cover letter
SEC/2807/2023 By E-Filing July 28, 2023 National Stock Exchange of India Limited BSE Limited “Exchange Plaza”, Corporate Relations Department, C-1, Block G, Phiroze Jeejeebhoy Towers, Bandra- Kurla Complex, Dalal Street, Bandra (E), Fort, Mumbai – 400 051. Mumbai - 400 001. Scrip Symbol : APARINDS S
Slide 2: Corporate Presentation – July 2023
Ascending Passionately, Achieving Responsibly CORPORATE PRESENTATION – JULY 2023
Slide 3: Table of contents
Table of contents 04 COMPANY OVERVIEW 42 FINANCIAL OVERVIEW 49 ANNEXURES 58 SHAREHOLDING PATTERN
Slide 4: Safe harbour
Safe harbour This presentation may have certain statements that may be “forward looking” including those relating to general business plans and strategy of APAR Industries Ltd., its outlook and growth prospects. The actual results may differ materially from these forward-looking statements due to se
Slide 5: Company Overview
COMPANY OVERVIEW
Slide 6: About APAR
About APAR o We are a technology-driven, customer-focused company that delivers – innovative, cost-effective, quality products & services o We believe that with an innovation-first mindset, we can find impactful solutions for our customers o Trusted by major Power Generation, Transmission, Distribut
Slide 7: APAR Industries: Tomorrow's solutions today
APAR Industries: Tomorrow’s solutions today 14,352 #1 3rd #1 Largest global aluminium & Largest global manufacturer of Cables manufacturer for Cr FY23 Consolidated Revenue, alloy conductors’ manufacturer Transformer oils renewables in India 5 year CAGR at 19.3% Leveraging global network Leading the
Slide 8: Our catalyst for innovation
Our catalyst for innovation To design & manufacture Building Blocks for Energy Infrastructure, Transportation & Telecommunication Sectors that contribute MISSION meaningfully to make this world a more energy efficient, environmentally sustainable and safer place To be a global leader in the energy i
Slide 9: Our 65 years of legacy (1/2)
Our 65 years of legacy (1/2) Company incorporated Greenfield expansion to meet Diversification into State-of-the-art R&D unit with conductor business growing oils demand auto lubes segment setup at Rabale (setup Rabale oils plant) (license agreement with ENI Italy) (global presence in 100+ countries
Slide 10: Our 65 years of legacy (2/2)
Our 65 years of legacy (2/2) Greenfield expansion Commissioning of Sharjah plant, New APAR logo! Signed Sonu Sood as Achieved record high to meet growing conductors demand Signed agreement with Hindalco (Together we fought through covid-19) Brand Ambassador turnover of Rs. 14,352 Cr. (conductor plan
Slide 11: Well-diversified across industries & segments
Well-diversified across industries & segments Conductors Specialty Oils o One of the largest global manufacturers o 3rd largest global manufacturer of T-oils o Pioneered turnkey solutions for reconductoring with HEC, live line o 1st globally to supply the entire range of T-oils compliant to new inst
Slide 12: APAR Group – House of Brands
APAR Group – House of Brands 11 Corporate Presentation – July 2023
Slide 13: APAR's State-of-the-Art facilities strategically located
APAR’s State-of-the-Art facilities strategically located Manufactures: Cables Gujarat Umbergaon Manufactures: Conductors Jharsuguda Odisha Manufactures: Wires & Cables Maharashtra Manufactures: Khatalwada Conductors Lapanga Manufactures: Polymers Manufactures: Umbergaon Conductors Rabale Silvassa Ma
Slide 14: Conductors – One of the largest global manufacturers
Conductors – One of the largest global manufacturers ACCC OPGW Copper Railway conductors CTC Turnkey Solutions Strong leadership & competitive edge Strategic focus on higher-value products FY23 revenue of INR 7,013 crore, 5 years CAGR at 21.8% Adj. EBITDA* per MT at INR 44,114 in FY23 INR 433 crore
Slide 15: Transformation journey of Conductor division (1/2)
Transformation journey of Conductor division over the last decade (1/2) o Setup new conductor plant in Jharsuguda (Odisha) o Introduced a premium product line viz., o Introduced GAP-type conductors which has o Started the conductor division. APAR’s HTLS- ACCC & Turnkey project – special construction
Slide 16: Transformation journey of Conductor division (2/2)
Transformation journey of Conductor division over the last decade (2/2) o With electrification in Indian Railways, we At the end of FY 2023 introduced Copper Railway conductors as per o Business Grew to 7,013 cr. RDSO specifications o 4 plant locations o The only approved Indian manufacturer to supp
Slide 17: Growth drivers – Conductors
Growth drivers – Conductors o Completed 150+ turnkey solution projects o Delivered 1,60,131 MT of Conductors o Premium products contribution - 43% o New order inflow - 44% o Green initiatives to reduce carbon intensity in operations o All time high revenue in FY 2023 16 amounts in INR crore Corporat
Slide 18: Competitive advantage – Conductor
Competitive advantage – Conductor Exports mix in total conductor division – 50.7% in FY 23 Premium products o Technology & know-how involved in product and design, acting as a barrier to entry for competition o Special stringing mechanism with sophisticated equipment to protect the carbon composite
Slide 19: Specialty Oils & Lubricants – 3rd largest in Transformer Oils globally
Specialty Oils & Lubricants – 3rd largest in Transformer Oils globally Transformer oil White oils Industrial & process oils Industrial & auto lubricants Petroleum jelly POWEROIL TO NE premium Strong leadership & competitive edge Leading domestic player in auto lubes. INR 252 crore invested in FY16-F
Slide 20: Growth drivers – Specialty Oils & Lubricants
Growth drivers – Specialty Oils & Lubricants o 500+ Grade Oils o Total volume 4.86 lac KL of speciality oils during the year o Transformer oils volumes up 14% vs. FY22 o Industrial Oil sales up 9% vs. FY22 o Serving 140+ Countries o Launched best-in-class 99% biodegradable natural ester transformer
Slide 21: Competitive advantage – Specialty Oils & Lubricants
Competitive advantage – Specialty Oils & Lubricants Exports mix in total oil division – 44.9% in FY 23 o 3rd largest global player in transformer oils. o Diversified customer base and industries served viz., OEM's, Pharma, Tyres, Cosmetics, Auto Lubricants etc. o Limited organised players. o Approva
Slide 22: Cables - Largest domestic player in renewables
Cables - Largest domestic player in renewables Power cables House wire & cable Elastomeric cables E-beam irradiated cables OFC Speciality hybrid cables Strong leadership & competitive edge Strategic focus on higher-value products FY23 revenue of INR 3,263 crore, 5 years CAGR at 23.5% INR 430 crore i
Slide 23: Growth drivers – Cable Solutions
Growth drivers – Cable Solutions o 500+ range of cables o 11 certificate of compliance for US market, highest from India o Major presence in Africa, East Africa, Australia & Europe, o Increased demands from Railways, defence and non-conventional energy o Reached 3,263 crore in cables business in FY
Slide 24: Sonu Sood as the face of APAR Industries
Sonu Sood as the face of APAR Industries SONU SOOD ENDORSING OUR LIGHT DUTY CABLES RANGE o House wire o CAT 6 LAN cable o House wiring o House wire o Round Multicore o Telephone cable o Round multicore o HFFR o Round Multicore o 3 core flat cable o CCTV o Core flat cable o Round Multicore o EBXL HFF
Slide 25: Channel expansion in our Light Duty Cable business
Channel expansion in our Light Duty Cable business As on 31st March 2022 Channel Expansion As on 31st March 2023 19 Distributor presence 120 276 Retail count presence 2395 2 Retail state presence 13 Product Awareness 6,348 Demo’s 35,353 474 Electrician Meets 3,373 24 amounts in INR crore Corporate P
Slide 26: Competitive advantage – Cable Solutions
Competitive advantage – Cable Solutions Exports mix in total cable division – 51.7% in FY 23 o E-beam technology for house wiring - first mover advantage and the only company using this technology giving the product a 50-year life, melt resistant and flame retardant till 105 degrees. o India’s only
Slide 27: Introducing Telecom Solutions – Our newest vertical
Introducing Telecom Solutions – Our newest vertical Diversified Telecom Solutions as a separate a business vertical to bring more focus and garner maximum growth potential: Market Dynamics Focus Areas o Connected world with near zero latency o Converged networks o Cloud shift from hyperscale to edge
Slide 28: Well-defined Risk Management framework in existence
Well-defined Risk Management framework in existence Customer / Credit Risk Management: o Structured process of evaluating customer & end customer background. o Defined practices for setting up of credit limits. o Process for securing credit thru various means. o In-house business-legal teams within
Slide 29: Focus on revenue growth and increased efficiency
Focus on revenue growth and increased efficiency Enhancing Operational Efficiency o Continue to seek to improve efficiencies, streamline capacities and asset utilization and manage capital expenditure for each of the production facilities o Implemented various initiatives to lower costs, such as pur
Slide 30: Unique capabilities
Unique capabilities Diversified business across product portfolio, market segments, Strong financial performance sustained over the years 01 customer base and geographies 04 Well positioned to capture industry trends related growth Robust in-house technology, innovation and R&D capabilities 02 both
Slide 31: Organisational structure – Senior leadership
Organisational structure – Senior leadership Board of Directors Managing Independent Directors/Director Directors Oil Conductor Cable CFO CHRO Treasury ESG CS Operational Business Heads - Business Head - CEO – Cable Heads B2B Projects Solutions Marketing Operational Business Head - Business Head - B
Slide 32: Strong financial performance sustained over the years
Strong financial performance sustained over the years 31 amounts in INR crore Corporate Presentation – July 2023
Slide 33: Key financial ratios
Key financial ratios * Not annualised 32 amounts in INR crore Corporate Presentation – July 2023
Slide 34: Extensive global presence driving exports
Extensive global presence driving exports PRESENCE IN 140+ COUNTRIES & EXPANDING Prominent presence with established business partners & distributors in USA Canada Australia Brazil Columbia Peru Chile Ethiopia Europe South Africa North South GCC Middle Africa Asia East (UAE) Algeria) (India) Export
Slide 35: Industries we cater to
Industries we cater to 03 Renewable Railways Energy 04 Defence Transformers Mining 05 Industrial 02 Nuclear Atomic Telecommunication & Data Communication Motors & 01 Generators 06 Power Transmission 08 Shipping & Distribution Wires & Cables 07 34 Corporate Presentation – July 2023
Slide 36: Key growth drivers
Key growth drivers Global Infrastructure Spends 01 Electrification • Rise in Power spending • New transmission and distribution systems globally. China Plus One 02 Risk diversification with increased manufacturing capabilities • New market access Carbon Neutrality 03 Adoption of diverse renewable en
Slide 37: Strategic outlook
Strategic outlook Product diversification with focus on premium offerings 1 Renewable energy power infrastructure – significant increase in products & capacities for solar, wind and power telecom 2 convergence. Exploring new markets with export-led focus B2B, 3 wider distribution network B2C 4 Impro
Slide 38: Making this world a better place - ESG
Making this world a better place - ESG As per CRISIL ESG Rating report: RELEASES TWO ESG REPORTS RANKED 3RD AMONG INDUSTRIAL SECTOR KEY METRICS (FY 2021-22) FY 2021-22 FY 2020-21 90,490 tCO2e GHG emission 227,289 KL Water Footprint KL of rainwater harvesting facility ready for monsoon To download Sc
Slide 39: Doing good for society - healthcare
Doing good for society - healthcare DR. N.D DESAI, FACULTY OF MEDICAL DHARMSINH DESAI UNIVERSITY DHARMSINH DESAI MEMORIAL SCIENCE & RESEARCH (DDU) METHODIST HEART INSTITUTE Gujarat Gujarat Gujarat Free Multi-speciality hospital with Established in 1968 Offers Provides world-class cardiac care 800
Slide 40: Doing good for society – Education and Nutrition
Doing good for society – Education and Nutrition ANAMRITA FOUNDATION GOVARDHAN ECO VILLAGE SUPPORTING TOMORROW’S DREAMS Provides Free midday meals in 21 India’s 3rd largest skill Supporting technical high school & cities development centre boys high school at Nadiad Serving 6,500+ schools, 10 S
Slide 41: Significant change in customer mix with focus on premiumization FY23
Significant change in customer mix with focus on premiumization FY23 Particulars 12MFY23 Exports 48.7% Industries/Corporate 16.7% Specific industry groups 8.6% OEM's 6.5% EPC - Transmission companies 4.8% Utilities - Transmission companies 7.1% Renewables 2.7% Utilities - Electricity Distribution Bo
Slide 42: Quality of Receivables FY23
Quality of Receivables FY 23 Particulars % of Total Secured under various means 52.7% Government Transmission and sector specific companies 19.5% Others (of which 63% are with entities where APAR is having business relationship with over 27.8% 3 years) Total 100.0% 41 amounts in INR crore Corporate
Slide 43: Financial Overview
FINANCIAL OVERVIEW
Slide 44: Q1 FY24: Strong start to FY24 with revenues growing 22% and PAT growing 61%
Q1 FY24: Strong start to FY24 with revenues growing 22% and PAT growing 61% Revenue EBITDA PAT 22 YoY 54% YoY 61% YoY INR 3,773 crores INR 369* INR 197 crores crores Margin at 9.8% up 210 bps YoY Margin at 5.2% up 120 bps YoY o Q1 FY24 revenue up 22% YoY with volume-led growth across all divisions S
Slide 45: Conductors: Q1 FY24 highlights
Conductors: Q1 FY24 highlights Revenue Volume EBITDA 15% YOY 27% YOY 108% YOY INR 1,774 crores 45,565 MT INR 177 crores INR 85 crore (Q1 FY23) Margin at 9.9%; 5.5% (Q1 FY23) EBITDA per MT EBITDA post adj* EBITDA* per MT 64% YOY 124% YOY 77% YOY INR 38,740 INR 177 crores INR 38,740 INR 23,670 (Q1 FY2
Slide 46: Speciality Oils & Lubricants: Q1 FY24 highlights
Speciality Oils & Lubricants : Q1 FY24 highlights Revenue Volume EBITDA 13% YOY 13% YOY 34% YOY INR 1,198 crores 1,30,654 KL INR 78 crores INR 118 crores (Q1 FY23) Margin at 6.5%; 11.1% (Q1 FY23) EBITDA per KL EBITDA post adj* EBITDA* per KL 41% YOY 30% YOY 38% YOY INR 5,996 INR 78 crores INR 6,035
Slide 47: Lubricants: Q1 FY24 highlights
Lubricants : Q1 FY24 highlights Revenue Volume 11% YOY 1% YOY INR 241 crores 17,470 KL o Revenue is up by 11% in Q1 FY24 vs Q1 FY23 o Industrial volume is up 13% YoY, Automotive volume is down by 6% YoY o This year Agriculture seasonal demand from both OEMs and retail was weaker than anticipated. o
Slide 48: Cables: Q1 FY24 highlights
Cables : Q1 FY24 highlights Revenue EBITDA EBITDA post adj* 52% YOY 112% YOY 127% YOY INR 967 crores INR 110 crores INR 110 crores INR 52 crores (Q1 FY23) INR 49 crores (Q1 FY23) Margin at 11.3%; 8.1% (Q1 FY23) Margin at 11.4%; 7.6% (Q1 FY23) o Revenue up 52% v/s LY due to increase in Elastomeric pr
Slide 49: Q1 FY24 Division-wise EBITDA to PAT
Q1 FY24 Division-wise EBITDA to PAT Particulars Oil Conductor Cable Others Total EBITDA pre-open period forex (Note 1) 78 177 110 3 368 Open period forex (Note 2) (1) (0) (1) 0 (1) EBIDTA post open period forex 78 177 110 3 369 Finance cost (ex open period forex) (Note 3) 22 27 15 0 65 Unallocable f
Slide 50: Annexures
ANNEXURES
Slide 51: Q1 FY24: Consolidated Profit & Loss Statement
Q1 FY24: Consolidated Profit & Loss Statement Particulars Q1 FY24 Q1 FY23 % Chg YoY Q4 FY23 % Chg QoQ Gross sales 3,741.2 3,083.4 21.3% 4,056.5 (7.8%) Other Operating Income 31.8 9.8 224.5% 32.1 (0.9%) Total Operating Income 3,773.0 3,093.2 22.0% 4,088.6 (7.7%) Total Expenditure 3,426.9 2,855.8 20.0
Slide 52: Q1 FY24: Consolidated Segment Analysis
Q1 FY24: Consolidated Segment Analysis Segments Q1 FY24 Q1 FY23 % Chg YoY Q4 FY23 % Chg QoQ Revenue Conductors 1,774.2 1,548.2 14.6% 2,121.3 (16.4%) Transformer & Specialty Oils 1,198.0 1,063.8 12.6% 1,179.4 1.6% Power & Telecom Cables 966.8 637.8 51.6% 943.0 2.5% Others/Unallocated 28.9 27.7 4.3% 2
Slide 53: Q1 FY24: Consolidated Segment Analysis
Q1 FY24: Consolidated Segment Analysis Segment Q1 FY24 Q1 FY23 % Chg YoY Q4 FY23 % Chg QoQ Segment Results before Interest and Tax Conductors 170.5 77.4 120.3% 275.1 (38.0%) Transformer & Specialty Oils 72.7 112.2 (35.2%) 40.6 79.1% Power and Telecom Cables 101.9 44.4 129.5% 107.1 (4.9%) Others/Unal
Slide 54: Q1 FY24: Financials
Q1 FY24: Financials Key Ratios Q1 FY24 Q1 FY23 Q4 FY23 EBITDA Margin 9.5% 7.8% 10.6% Net Margin 5.2% 4.0% 5.9% Total Expenditure/ Total Net Operating Income 90.8% 92.3% 89.6% Raw Material Cost/ Total Net Operating Income 75.5% 75.6% 72.9% Staff Cost/ Total Net Operating Income 1.7% 1.6% 1.7% Other E
Slide 55: 12M FY23: Consolidated Profit & Loss Statement
12M FY23: Consolidated Profit & Loss Statement Particulars 12M FY23 12M FY22 % Chg YoY Gross sales 14,272.6 9,287.2 53.7% Other Operating Income 79.5 29.4 170.4% Total Operating Income 14,352.2 9,316.6 54.0% Total Expenditure 13,125.2 8,768.7 49.7% Cost of Raw Materials 10,708.8 7,207.8 48.6% Employ
Slide 56: 12M FY23: Consolidated Segment Analysis
12M FY23: Consolidated Segment Analysis Segment 12M FY23 12M FY22 % Chg YoY Revenue Conductors 7,013.1 4,200.4 67.0% Transformer & Specialty Oils 4,656.7 3,544.2 31.4% Power & Telecom Cables 3,263.5 1,993.7 63.7% Others/Unallocated 107.3 73.0 47.0% Total Revenue 15,040.5 9,811.4 53.3% Less: Inter -
Slide 57: 12M FY23: Consolidated Segment Analysis
12M FY23: Consolidated Segment Analysis Segment 12M FY23 12M FY22 % Chg YoY Segment Results before Interest and Tax Conductors 682.5 162.8 319.2% Transformer & Specialty Oils 225.0 267.6 (15.9%) Power and Telecom Cables 316.8 79.8 297.0% Others/Unallocated 6.8 4.5 51.1% Total 1,231.2 514.6 139.2% Le
Slide 58: 12M FY23: Financials
12M FY23: Financials Key Ratios 12M FY23 12M FY22 EBITDA Margin 8.8% 6.2% Net Margin 4.4% 2.8% Total Expenditure/ Total Net Operating Income 91.5% 94.1% Raw Material Cost/ Total Net Operating Income 74.6% 77.4% Staff Cost/ Total Net Operating Income 1.5% 1.9% Other Expenditure/ Total Net Operating I
Slide 59: Shareholding Pattern
SHAREHOLDING PATTERN
Slide 60: Market performance and shareholding structure
Market performance and shareholding structure APAR has been consistently outperforming market 470 257% 370 270 170 56% 22% 70 Apar Capital Goods Sensex Chart has been rebased to 100 As on June 30, 2023 Outstanding shares – 3,82,68,619 12.8% Major Non-Promoter Shareholders Shareholding (%) 1.1% Promo
Slide 61: Thank You
For Institutional enquiries Mr. Ramesh Iyer CFO & Investor Relations Mr. Ambesh Tiwari / Mr. Mohit Joshi Contact No : +91 22 67800400 Contact No : +91 84248 93404 / +91 99302 06777 E-mail – ramesh.iyer@apar.com E-mail – ambesh@s-ancial.com/ mohit@s-ancial.com #215, Shiv Shakti Industrial Estate, 2Nd