Sumitomo Chemical India Ltd. · NSE:SUMICHEM
Sumitomo Chemical India — Q4 FY20 Earnings Presentation
39 slides from Sumitomo Chemical India's earnings presentation, June 2020
Slide 1: Sumitomo Chemical India Limited Investor Presentation
Sumitomo Chemical India Limited Investor Presentation June 2020
Slide 2: Safe Harbour
Safe Harbour This presentation and the accompanying slides (the “Presentation”), which have been prepared by Sumitomo Chemical India Limited (the “Company”), have been prepared solely for information purposes and do not constitute any offer, recommendation or invitation to purchase or subscribe for
Slide 3: Q4 & FY20 Results Presentation
Q4 & FY20 Results Presentation
Slide 4: Performance Highlights – Q4 & FY20
Performance Highlights – Q4 & FY20 Revenue (Rs Crs) EBITDA (Rs. Crs) & EBITDA Margin (%) Adj PBT * (Rs Crs) +6% +49% +58% 50 20 ✓ Q4 FY20 revenue growth of 446 42 33 6% YoY driven by broad- 422 40 15 based volume growth across 30 28 21 products, geographies and 9.4% 10 business segments 20 6.7% 5 ✓
Slide 5: Consolidated Profit & Loss Account Statement
Consolidated Profit & Loss Account Statement Particulars (Rs. Crs) Q4 FY20 Q4 FY19 YoY FY20 FY19 YoY Revenue from Operations 445.8 421.7 6% 2,424.8 2,228.4 9% COGS 289.8 285.4 1,607.7 1,458.9 Gross Profit 155.9 136.3 14% 817.1 769.6 6% Gross Profit % 35.0% 32.3% 266 bps 33.7% 34.5% -84 bps Employee
Slide 6: Revenue Breakup – FY20 Vs FY19
Revenue Breakup – FY20 Vs FY19 Product Breakup Geographic Breakup 6% 7% 9% 11% 8% 7% 49% 47% 78% 80% FY19 FY20 11% 10% 22% 20% 17% 18% FY19 FY20 Insecticides PGR Fungicides Domestic Export Herbicides Metal Phosphides AND & EHD* Segment Breakup Bulk & Branded Domestic Exports 20% 19% 73% 71% 62% 65%
Slide 7: Consolidated Balance Sheet
Consolidated Balance Sheet Assets (Rs. Crs) Mar-20 Mar-19 Equity & Liabilities (Rs. Crs) Mar-20 Mar-19 Non-Current Assets (A) 360.6 318.3 EQUITY (A) 1,221.8 1,048.4 Property, Plant and Equipment 282.9 277.2 Equity Share Capital 499.1 274.6 Capital work-in-progress 6.5 3.2 Right to use an Asset 34.9
Slide 8: Consolidated Working Capital Movement
Consolidated Working Capital Movement Particulars (Rs. Cr) Mar-20 Mar-19 Change Inventory (A) 588.0 680.6 -92.6 Inventory Days (Inventories/ COGS*365) (i) 133 170 Trade Receivables (B) 849.8 671.0 178.8 Trade Receivables Days (Trade Receivables / Revenue*365) (ii) 128 110 Trade Payables (C) 490.9 48
Slide 9: Key Developments: COVID-19 Update
Key Developments Update on COVID-19 Safety measures undertaken by the Company ✓ Global pandemic Covid-19 caused severe impact globally and in India. India announced country-wide strict lockdown since last week of March 2020 and such measures continue to be in force till date in gradually relaxed for
Slide 10: Key Developments: Draft Order Banning Insecticides
Key Developments Impact of Draft order banning 27 Insecticides by Government of India ✓ Recently the Government of India released a draft notification for public comments regarding proposed ban of some agro-chemical products ✓ The matter is being discussed at various forums such as various industry
Slide 11: Company Overview
Company Overview Formidable Player in the Journey to 10x Growth Merger of Excel Crop Care Indian Agrochemicals Space in India Unlocking Value Autonomous Board with Vast To Benefit from Strong Industry Experience Parentage of SCC Japan
Slide 12: Leading Agrochemicals Player in India
Leading Agrochemicals Player in India Overview Diversified Product Portfolio & Segment Mix (FY20) 7% Incorporated in 2000 as a wholly owned subsidiary of SCC, Japan to drive ASD expansion of its Health & Crop Sciences business in India AND & EHD Primarily engaged in manufacture and sale of specialit
Slide 13: Formidable Player in the Indian Agrochemicals Space
Formidable Player in the Indian Agrochemicals Space Grown 12X* over FY11-20 Rs. Bn 5 190+ 10X Manufacturing Brands 24 Facilities 10+ 25+ / 200+ Technical Actives Patents / Registrations 2 13,000+ 1,500+ FY11 FY20 Distributors Employees *On an organic basis, grown 6X 13
Slide 14: Journey to 10x Growth in India
Journey to 10x Growth in India Exploration Phase: 2000 – 2009 Manufacturing JV with New Acquired product - 2000 Chemi 2002 Started EHD (Public Health) 2005 ‘Sulfosulfuron’ Leader 2010 business rights from Monsanto Started Animal Nutrition SCIL incorporated in India as 2001 Started ASD business 2003
Slide 15: Merger of Excel Crop Care to Unlock Value
Merger of Excel Crop Care to Unlock Value Successfully and smoothly completed the merger Pre-Merger Structure Post-Merger Structure SCC and its affiliates Public Shareholders SCC and its affiliates (Japan) 44.98% Public & Others (Japan) 35.03% Excel Crop Care (ECC) 80.3% 19.7% 100.00% 19.98% Sumitom
Slide 16: Well-diversified Platform of Scale (1/2)
Well-diversified Platform of Scale (1/2) Parameter ECCL SCIL (Pre-Merger) SCIL (Post-Merger) Manufacturing Facilities Plants in Gujarat (2) and Plant in Maharashtra (1) and Dadar & Nagar Haveli (1) Gujarat (1) 5 plants in West India Predominantly a formulation Manufacturing Capability Presence in bo
Slide 17: Well-diversified Platform of Scale (2/2)
Well-diversified Platform of Scale (2/2) Parameter ECCL SCIL (Pre-Merger) SCIL (Post-Merger) Product Capability Major focus on Generics; nascent Major focus on Speciality Presence across complete presence in Biopesticides Products range of products Business Segments Presence only in agrochemical Pre
Slide 18: Autonomous Board with Vast Industry Experience
Autonomous Board with Vast Industry Experience Dr. Mukul Govindji Asher Chetan Shantilal Shah Chairman and Independent Director Managing Director ▪ Professorial Fellow at Lee Kuan Yew School of Public Policy at ▪ Commerce graduate from the University of Mumbai and the National University of Singapor
Slide 19: Autonomous Board with Vast Industry Experience
Autonomous Board with Vast Industry Experience Bhupendranath Bhargava Preeti Gautam Mehta Independent Non-executive Director Independent Non-executive Director ▪ Experience of over 50 years in areas including banking, ▪ 30 years of experience in corporate laws, foreign investment project financing a
Slide 20: To Benefit from Strong Parentage of SCC Japan
To Benefit from Strong Parentage of SCC Japan About SCC, Japan ✓ SCC is a leading Japanese research driven diversified chemical company listed on the Tokyo Stock Exchange with consolidated sales revenue for FY20 of US$ 20.3 bn and Health & Crop Sciences Sector of US$ 3.1 bn ✓ Offers diverse range of
Slide 21: Sustainable Drivers for Growth
Sustainable Drivers for Growth Diversified & De-risked Strategically Located Strong Focus on R&D and Portfolio Across the Agro- Manufacturing Facilities Process Innovation Chem Value Chain Strong Brand and Well- Expanding Brand Visibility Well placed to benefit from Entrenched Distribution and Conne
Slide 22: Diversified & De-risked Portfolio Across the Agro-Chem Value Chain
Diversified & De-risked Portfolio Across the Agro-Chem Value Chain Balanced Presence Across Key Sub-Segments Geographic Diversification with Exports to over 60 countries of the Agro-Chem Value Chain Insecticides 7% 4% North America Herbicides 11% Domestic 13% South America PGR 80% 19% Europe Metal P
Slide 23: Strategically Located Manufacturing Facilities
Strategically Located Manufacturing Facilities Connectivity to Major Cities and Proximity to Main Highways, Ports Reduces Logistic Time and Costs Plant Location Area (acres) Segment Served Product Manufactured Manufacturing of Technical Grade Pesticides Bhavnagar ~58 and Formulation Development Prod
Slide 24: Strong Focus on R&D and Process Innovation
Strong Focus on R&D and Process Innovation End-to-End Product Development Capabilities ✓ 3 fully equipped, DSIR approved R&D labs located at Mumbai, Bhavnagar and Gajod capable of synthesis, technical product and formulation development ✓ R&D Team comprises of 75+ qualified and dedicated engineers &
Slide 25: Strong Brand and Well-Entrenched Distribution Network
Strong Brand and Well-Entrenched Distribution Network ✓ Strong brand with market leading position across various product categories 23 States 68 Depots ✓ Dual brand portfolio can offer products at all price points serving multiple customer sub-segments 13,000+ ~40,000 ✓ In-depth knowledge of own res
Slide 26: Expanding Brand Visibility and Connect
Expanding Brand Visibility and Connect ✓ Wide range of generics and speciality products for Increased crop presence and providing crop protection solutions ✓ More than 1,400+ Relationship managers connecting to 1 million+ farmers throughout crop cycle ✓ Over 100 brands covering maximum of crops and
Slide 27: Digital Marketing Initiatives
Digital Marketing Initiatives Develop “Digital Marketing” as a parallel support to Traditional marketing system leading to improved sales. ✓ Our Digital Assets : 21 websites, currently driving about 8,648 visitors everyday. YouTube - Advantage http://www.danitolindia.com/ http://www.naturedeep.in/ I
Slide 28: Well Placed to Benefit from Sector Tailwinds
Well Placed to Benefit from Sector Tailwinds Pesticides: Market Share by Segment Highly Underpenetrated Market Significant growth opportunity for Indian Players 5% Pesticide Consumption (Kg/ha) Agrochemical Market Size (US$ bn) 1% 22% 13 12 +8% 8.1 FY18 47% 7 4.1 5 5 25% <1 Insecticides PGR Fungicid
Slide 29: Thrust on Safety, Health and Environment (SHE)
Thrust on Safety, Health and Environment (SHE) Quality Certifications Ensure Consistent product quality and healthy working environment at manufacturing sites Abiding by SCC Japan’s EHS Policies ISO:9001:2015, ISO-14001:2015 and OHSAS18001:2007 for the manufacturing sites at Bhavnagar, Gajod, Tarapu
Slide 30: Growth Strategies & Financial Performance
Growth Strategies Performance Highlights Growth Strategies & Financial Performance Profit & Loss Account Balance Sheet Cash Flow
Slide 31: Vision & Mission
Vision & Mission Vision & Values Mission Vision: Marketing and Sales: • To be a trusted market leader in Indian crop- Further penetration into Indian market & take protection sector leadership; expand exports • To develop a vibrant corporate culture • Strengthen Sales Force, Distribution and Product
Slide 32: Growth Strategies
Growth Strategies Continued Investment in R&D and Pipeline Capacity Expansion Achieving Market Leadership in • Aim to invest in seamless integration of R&D between SCIL and SCC • units which would help improve our production processes, Driving operational efficiencies maintaining highest safety stan
Slide 33: Performance Highlights
Performance Highlights Revenue (Rs Crs) EBITDA (Rs. Crs) & EBITDA Margin (%) PAT (Rs Crs) +13% +24% +19% 2,425 333 205 2,228 291 1,913 166 217 145 11.3% 13.0% 13.7% ✓ Combined entity ~2x in size FY18* FY19 FY20 FY18 FY19 FY20 FY18 FY19 FY20 ✓ Net debt free balance sheet ✓ Strong margin profile maint
Slide 34: Consolidated Profit & Loss Account Statement
Consolidated Profit & Loss Account Statement Particulars (Rs. Crs) FY20 FY19 FY18 Net Revenue from Operations 2,424.8 2,228.4 1,912.9* COGS 1,607.7 1,458.9 1,238.7 Gross Profit 817.1 769.6 674.2 Gross Profit % 33.7% 34.5% 35.2% Employee Expenses 179.3 158.4 147.5 Other Operating Expenses 304.7 320.5
Slide 35: Consolidated Balance Sheet
Consolidated Balance Sheet Assets (Rs. Crs) Mar-20 Mar-19 Mar-18 Equity & Liabilities (Rs. Crs) Mar-20 Mar-19 Mar-18 Non-Current Assets 360.6 318.3 312.7 EQUITY 1,221.8 1,048.4 954.0 Property, Plant and Equipment 282.9 277.2 264.8 Equity Share Capital 499.1 274.6 274.6 Capital work-in-progress 6.5 3
Slide 36: Consolidated Cash Flow Statement
Consolidated Cash Flow Statement Cash Flow Statement (Rs. Cr) Mar-20 Mar-19 Mar-18 Net Profit Before Tax 266.5 259.8 221.0 Adjustments for: Non-Cash Items / Other Investment or Financial Items 45.7 18.6 9.6 Operating profit before working capital changes 312.2 278.5 230.6 Changes in working capital
Slide 37: Awards & Accolades
Awards & Accolades Jamnalal Bajaj Award for “Fair Business and Practices” Shramveer award for improvement of product efficiency received from national level Delhi First ever president’s gold shield for import substitution Vishwakarma Rashtriya Puraskar received for process development First award fo
Slide 38: Key Takeaways
Key Takeaways Formidable Player in the Indian Experienced Management Team Well-diversified Product Portfolio Strong Brand and Well-Entrenched Agro-chem Space and Board of Directors Across Agro-Chem Value Chain Distribution Network ▪ Strong / leadership position across ▪ Strong management and ▪ Multi
Slide 39: For further information, please contact
For further information, please contact: Company : Investor Relations Advisors : Sumitomo Chemical India Limited Strategic Growth Advisors Pvt. Ltd. CIN: U24110MH2000PLC124224 CIN: U74140MH2010PTC204285 Mr. Jigar Kavaiya / Mr. Pratik Shah 99206 02034 / 97692 60769 investor.relations@sumichem.co.in j
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