Star Cement Ltd. · NSE:STARCEMENT
Star Cement — Star Ferro and Cement — Investor Presentation (May 2015)
31 slides from Star Cement's investor presentation, May 2015
Slide 1: Star Ferro and Cement Limited Investor Presentation
Star Ferro and Cement Limited (SFCL) Investor Presentation Cementing growth. Branding success. BSE Scrip code: 536666 NSE Scrip code: SFCL May 2015
Slide 2: 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 3: Expanding the growth horizon and creating a differential
From North East to East From Growth to Efficiencies From Commodity to Brand From Capacities to Capabilities We are expanding the growth horizon and creating a differential. 02
Slide 4: 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 & Jharkhand) Star Ferro and Cement Limited (listed on BSE & NSE) Strategically located Cement Manufacturing Facilities Cement Busin
Slide 5: Counting the Stars
Counting the Stars ₹ 1,650 Crores ₹ 1,473 Largest private Crores sector investment Turnover recorded in FY in North Eastern Region 2014-15 (NER) 4,700 23% #No. of technical Market share in NER – services provided to the biggest pie in the region end-users 11 ₹ 1,800+ States presence Highest per ton
Slide 6: The Star Bandwidth
The Star Bandwidth Star Ferro and Cement Ltd. Promoters 29.52% 70.48% 100% Megha Technical & Engineers Pvt. Ltd. (‘MTEPL’) Grinding unit with capacity of 0.67 Cement Manufacturing Company Ltd. mtpa at Lumshnong (‘CMCL’) Power generation capacity of 9MW Clinker manufacturing capacity of 0.80 mt
Slide 7: Strong NER Roots
Strong NER Roots Promoters have strong links with NER - a crucial factor behind SFCL’s success Mr. Sajjan Bhajanka, Chairman & MD Mr. Sanjay Agarwal, Managing Director Experience Experience Graduate with 45 years of industry experience in Plywood, Graduate with 30 years of industry experience La
Slide 8: Professional Management
Professional Management Key Management personnel running the organisation in a very professional manner Mr. Pankaj Kejriwal, Executive Director Mr. Sanjay Kr. Gupta, CEO Education Education & Experience Chemical Engineer with experience of over 15 years FCA with varied experience of over 22 year
Slide 9: Journey of a Star
Journey of a Star Cumulative capacities at the end of financial years FY 10-11 FY 04-05 FY 07-08 0.80 FY 12-13 Clinker (MMT) 0.40 0.60 2.60 FY 14-15 CAGR: 20.43% 2.60 Cement (MMT) FY 04-05 FY 07-08 FY 12-13 CAGR: 27.21% 0.40 1.06 3.00 FY 10-11 1.27 FY 14-15 3.40 FY 12-13 FY 14-15 Power (MW) FY 09-10
Slide 10: 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 power Market Succe
Slide 11: Location Advantage: The Game Changer
Location Advantage: The Game Changer Arunachal Pradesh Sikkim Itanagar Gangtok 110 kms Siliguri 2 3 Dispur Assam Nagaland (Guwahati) 220 km Kohima Patna Shillong Our strategically located Bihar Meghalaya 1 plants cater to the Imphal Eastern & North Eastern Manipur Regions, giving us strong customer
Slide 12: 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 Coal is available in close proximity, ensuring cost and operational efficiencies Availability of coal also provid
Slide 13: The Star Strategic Edge
The Star Strategic 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 10% from 30% - owing to strong location advantage for the existing players in NER Strong entry barriers for n
Slide 14: The Star Fiscal Edge: Financial Incentives
The Star Fiscal Edge: Financial Incentives SFCL’s plants enjoy many fiscal benefits granted by Central / State Governments Exemption Balance Exemption period SCML CMCL-GGU CMCL-LMS MTEPL 100% under Section 80 IE, Income Tax 8 years 8 years - 2 years subject to MAT Excise Duty on Clinker 75% 8 years
Slide 15: Powering Growth
Powering Growth Power Availability of best quality low cost coal ensures increased benefits for power plant Captive power ensures non-dependency on grid power Fly ash generated from power plant is used in cement plants at almost nil cost 14
Slide 16: The Mark of a Star: Branding Success
The Mark of a Star: Branding Success For Star Cement, cement is not merely a commodity and therefore, we do not sell cement, rather we build and sell brands Our Brands have a very high recall value, enabling repeat customers Star is the most preferred brand in NER and enjoys deep consumer trus
Slide 17: Awards and Accolades
Awards and Accolades Limestone Mines in Khub Award for ‘Most preferred Awarded first prize in the stood ‘First’ in the category Most preferred cement Cement brand’ for 5 years Thermal Power Station of Overall performance brand by AREIDA from consecutively at the North Sector - National Energy during
Slide 18: The Star Shines Bright and Strong
The Star Shines Bright and Strong Enjoys a leadership position in the North East with 23% Market share 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 leadership positi
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 Brand in markets of West Bengal, Bihar and Jharkhand Consumer-centric strategic appro
Slide 20: Marketing the Star Brand
Marketing the Star Brand Innovative strategy, large distribution network, pioneering 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
Slide 21: Retail-driven Marketing strategy
Retail-driven Marketing strategy Distribution network spread across 11 states Distribution Network While our peers adopted the wholesaler Retailers 5,000+ model, we have built on our strong network Dealers 2,000+ of partners over the last decade The result – Deeper penetration, greater reach,
Slide 22: Opportunities Beckon… and Star's Journey Continues
Opportunities Beckon… and Star’s Journey Continues 21
Slide 23: East India: Huge Untapped Potential
East India: Huge Untapped Potential Total Capacity (MMT) Total production (MMT) and capacity utilisation (%) 60 54 49 45 90 50 39 43 45 40 36 37 85 85 33 85 37 35 31 40 34 29 30 80 80 30 25 77 75 75 20 20 15 71 70 10 10 65 5 0 0 60 FY 10 FY 11 FY 12 FY 13 FY 14 FY 15 E FY 10 FY 11 FY 12 FY 13 FY 14
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 shortages in urban India, East alone contri
Slide 25: North East Region: An Expanding Opportunity Landscape
North East Region: An Expanding Opportunity Landscape 8 states with abundant Separate Ministry for Special Category States Natural Resources with NEIIPP, 2007 & the Region – Doner Limestone, Coal, Dolomite, (Development of North Eastern State Policies supporting Quartz, Granite, Sandstone, Region) t
Slide 26: North East Region: Opportunities Galore
North East Region: Opportunities Galore 12 11 11 11 Five-year 2007- 2012- 2017- 10 Plans 2012 2017 2022 10 9 8.23 NER Cement 8 7.48 Capacity (Mn 7 7 6.8 Tons) 6.02 6.3 NER GDP 5.4 5.82 10% 13.7% 16.4% 6 Growth NER Cement 4 Demand (Mn Tons) NER Per 2 Capita 8.6% 12.4% 15.2% growth 0 FY 10-11 FY 11-12
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 2010-11 2011-12 2012-13 2013-14 2014-15 Gross Sales 504 597 625 1,123 1473 Net Sales 486 565 595 1,028 1430 C O N S O L I D AT E D F I N A N C I A L S EBIDTA 152 145 120 234 437 EBIDTA Margin (%) 31% 26% 20% 23% 31% Cement Subsidiary C
Slide 29: The Numbers Speak: Successful Financial Track Record
The Numbers Speak: Successful Financial Track Record In ₹ Crores 2012-13 2013-14 2014-15 Gross Sales 694 1,171 1,473 Net Sales 660 1,173 1,430 C O N S O L I D AT E D F I N A N C I A L S EBIDTA 120 257 436 Star Ferro & Cement Ltd EBIDTA Margin (%) 18% 22% 30% Cash Profit 88 167 344 EBIT 70 96 212 PBT
Slide 30: EBIDTA Margins vis-a-vis Industry
EBIDTA Margins viz’-a-viz’ Industry Cement EBITDA/tonne comparison (₹) 2000 1850 1315 1349 SFCL 1500 1130 1000 879 All India Average 500 729 827 693 0 FY 11-12 FY 12-13 FY 13-14 FY 14-15 90 87 Utilisation rates (%) 80 72 70 68 SFCL (%) 70 60 71 68 67 Industry utlisation rates 50 58 (%) 40 FY 11-12 F
Slide 31: Thank You
Thank You Mr. Sanjay Kr. Gupta +91 98300 45256 +91 33 24484172 sanjaygupta@cmcl.co.in www.starferrocement.com
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