Grasim Industries Ltd. · NSE:GRASIM
Grasim Industries — Q1 FY2015-16 Earnings Presentation
41 slides from Grasim Industries's earnings presentation, Aug 7, 2015
Slide 1: Quarterly Performance Review Q1 2015-16
Quarterly Performance Review Quarter 1 : 2015-16 Mumbai, 7th August, 2015 Grasim Industries Limited A VSF and Cement Major
Slide 2: Contents
Contents Highlights 1-4 Financial Performance 5-6 Business Performance 7 -14 Capex Plan 15 Glossary VSF : Viscose Staple Fiber, MT : Metric Ton, TPA : Tons Per Annum, YoY: Year on Year Comparison, CY : Current Year, LY : Last Year, EBIDTA : Earnings before Interest, Depreciation and Tax and
Slide 3: Indian Economy
Indian Economy Macro economic indicators have improved supported by decline in Energy prices CAD at 1.3% of GDP in FY 15, lowest since FY 08 CPI remains range bound at around 5% , WPI is negative Economic activity showing signs of recovery IIP has been recovering, albeit unevenly Capital
Slide 4: Highlights: VSF Business
Highlights VSF Business Increase in global prices in Q1FY16 after prolonged decline 2nd Largest Globally - Uptick in PSF & Cotton prices Capacity 498K TPA - Rise in raw material cost in China Sales Volume Revenue EBITDA 102,737 MT ` 1,254 Cr. ` 139 Cr. (Up by 19% YoY) (Up by 15% YoY) (Up by 72% YoY
Slide 5: Highlights: Chemical Business
Highlights Chemical Business Largest Chlor-Alkali Caustic prices improved sequentially with increase in Manufacturer in India international prices Sales Volume Revenue EBIDTA 98,055 MT ` 485 Cr. ` 94 Cr. (Q1 LY : 97,678) (Up by 17% YoY) (Up by 3% YoY) Update on merger of ABCIL with Grasim − Approval
Slide 6: Highlights: Cement Business
Highlights Cement Business Market leader Prices remained under pressure in India - Overcapacity and lower offtake Sales Volume Revenue EBIDTA 13.0 Mn. Tons ` 6,432 Cr. ` 1,282 Cr. (Up by 4% YoY) (Up by 7% YoY) (Q1 LY : ` 1,296 Cr.) Update on Acquisition of MP cement units of Jaiprakash Associates −
Slide 7: Financial Performance
Financial Performance Standalone Amount in ` Cr. Revenue EBITDA Net Profit 15% 21% 1,657 238 106 106 1,440 196 Q1FY15 Q1FY16 Q1FY15 Q1FY16 Q1FY15 Q1FY16 Consolidated Revenue EBITDA Net Profit 3% 7% 1,488 1,531 487 485 8,599 8,045 Q1FY15 Q1FY16 Q1FY15 Q1FY16 Q1FY15 Q1FY16 5
Slide 8: Investment in Growth
Investment in Growth Substantial Investment made across Businesses – US$ 4 Bn. over last five years..... VSF * Caustic * Cement * Gross Fixed Asset KTPA KTPA Mn. TPA Rs. Cr 50% 30% 110% 75% 45577 498 452 63.2 334 48.8 21717 258 FY 10 FY 15 FY 10 FY 15 FY 10 FY 15 FY 10 FY 15 2nd Largest Globally Lar
Slide 9: Business Performance
Business Performance VSF Chemical Cement
Slide 10: VSF: Fastest Growing Fibre
VSF : Fastest Growing Fibre (Mn. Ton) VSF PSF Cotton 5.5 CAGR 26.2 25.3 -1% 24.4 4.8 24.5 22.2 3.5 21.9 17.0 15.5 2.7 12.6 8.6 2009-10 2014-15 Production Consumption 2009 2014 2009 2014 Season End Stock Capacity Demand Overcapacity across Fibres VSF fastest growing among competing fibres Risin
Slide 11: Textile Fibres Price Trend
Textile Fibres Price Trend Domestic Fibre Prices (` /Kg.) Global Fibre Prices ($/Kg.) 140 130 2.75 120 114 2.25 110 1.88 100 96 1.75 1.76 90 1.60 86 80 1.25 70 1.07 60 0.75 Grey VSF Cotton PSF Chinese cotton FY15 saw decline in Global Prices - PSF 15%, Cotton 16%, VSF 10% Uptick seen in prices in Q1
Slide 12: VSF: Performance
VSF : Performance Qtr. Capacity Revenue ( ` Cr.) (‘000 Ton) Sales volume up by 19% with ramping up of 15% 32% Vilayat plant 1254 Vilayat plant achieved 82% utilisation 125 1094 94 Nagda plant shutdown for 2 months (due to water shortage) restricted volume growth Q1FY15 Q1FY16 Q1FY15 Q1FY16 B
Slide 13: VSF: Performance
VSF : Performance Standalone EBITDA increased by 72% EBITDA (Rs Cr.) Higher volumes EBITDA Margin Improved margins from 7% to 11% Lower pulp and other input cost 72% Operational efficiency gains 139 Pulp and Fibre JVs performance : 11.0% 81 EBIDTA improved from ` (28 Cr.) to ` (1 Cr.)
Slide 14: VSF: Outlook
VSF : Outlook Prices likely to be influenced by Development in the down stream industry Resumption of operations at some of the shut capacities and increase in raw material prices in China Competing fibre prices showing weakness Concerted market and product development activities by Grasim
Slide 15: Chemical: Performance
Chemical : Performance Industry Scenario Revenue ( ` Cr.) EBITDA (Rs Cr.) Caustic prices improved sequentially with 17% increase in international prices EBITDA Margin 3% 22% Business Performance 20% 485 Revenue increased by 17% 414 91 94 Epoxy volumes almost doubled Caustic Sales volume main
Slide 16: Cement: Performance
Cement : Performance Qtr. Capacity Industry Scenario (Mn. Ton) Industry off take estimated flat for the quarter 2% Low capacity utilisation for the sector 15.4 15.8 Prices remained under pressure Q1FY15 Q1FY16 Business Performance Revenue up by 7% Revenue (` Cr.) EBITDA (Rs Cr.) Volume gro
Slide 17: Cement: Outlook
Cement : Outlook Cement demand expected to pick-up from H2 FY16 Cement demand growth drivers : Government focus on infrastructure development with higher budgetary allocation for roads, dedicated freight corridor, irrigation, port etc. Expected demand from “Smart Cities” and “Housing for all
Slide 18: Capex
ADITYA BIRLA GRASIM Capex
Slide 19: Capex plan
Capex plan (` Cr.) Capex Cash Outflow Capex (Net of CWIP spent FY16 FY17 as on during onward 01-04-15) Q1FY16 Standalone VSF Expansion : Vilayat (120K TPA) – Residual Capex 157 Nagda Revamp 149 Normal Capex : VSF 261 : Chemical & Others 153 Standalone Capex (A) 720 460 260 80 Cement Subsidiary : Ult
Slide 20: Summary
Summary Achieved improved performance amidst challenging market conditions Leadership position across businesses further strengthened with large investment in growth Company well poised to reap benefits of the investments with Ramping up of capacity utilisation Expected upturn in business
Slide 21: Thank You
ADITYA BIRLA GRASIM Thank You
Slide 22: Annexure - Financials
Grasim Industries Limited Annexure - Financials
Slide 23: Annexure
Annexure Consolidated Financial Performance Standalone Financial Performance Balance sheet Profitability Trend Revenue & PBIDT Chart VSF Summary Chemical Summary Cement Summary Organisational Structure Plant Locations
Slide 24: Consolidated Financial Performance
Consolidated Financial Performance (` Cr.) Quarter - 1 % Full Year 2015-16 2014-15 Change 2014-15 Net Sales & Op. Income 8,599.1 8,045.0 7 32,847.4 Other Income 113.9 269.6 (58) 539.0 EBITDA 1,531.0 1,487.8 3 5,683.4 EBITDA Margin (%) 17.6% 17.9% 17.0% Finance Cost 171.3 126.5 35 667.4 Depreciation
Slide 25: Standalone Financial Performance
Standalone Financial Performance (` Cr.) Quarter 1 Full Year % Change 2015-16 2014-15 2014-15 Net Sales & Op. Income 1,657.2 1,439.5 15 6,332.6 Other Income 21.9 55.1 (60) 348.1 EBITDA 237.5 196.0 21 1,013.0 EBITDA Margin (%) 14.1% 13.1% 15.2% Finance Cost 13.7 5.6 39.3 Depreciation 78.7 52.9 49 262
Slide 26: Balance Sheet
Balance Sheet (` Cr.) Standalone Consolidated 30th June'15 31stMar'15 EQUITY & LIABILITIES 30th June'15 31stMar'15 11,291 11,183 Net Worth 23,697 23,140 - - Minority Interest 7,918 7,682 1,040 1,115 Borrowings 11,305 11,930 654 615 Deferred Tax Liability (Net) 3,604 3,410 1,495 1,454 Liabilities & P
Slide 27: Profitability Trend
Profitability Trend (` Cr.) Standalone Consolidated FY FY FY Q1 FY FY FY Q1 2012-13 2013-14 2014-15 2015-16 2012-13 2013-14 2014-15 2015-16 Net Turnover & Op. Income 5,255 5,604 6,333 1,657 27,909 29,324 32,847 8,599 EBITDA 1,523 1,246 1,013 238 6,543 5,491 5,683 1,531 EBITDA Margin (%) 26.8 20.8 15
Slide 28: Revenue Chart
Revenue Chart (` Cr.) Quarter 1 % Full Year 2015-16 2014-15 Change 2014-15 Viscose Staple Fibre 1,254 1,094 15 4,974 Chemical 485 414 17 1,701 Others 25 26 89 Eliminations (Inter Segment) (107) (95) (431) Standalone Net Revenue 1,657 1,440 15 6,333 Subsidiaries Cement 6,432 6,032 7 24,349 Textiles 9
Slide 29: EBITDA Chart
EBITDA – Chart (` Cr.) EBIDTA Quarter 1 % Full Year 2015-16 2014-15 Change 2014-15 Viscose Staple Fibre 139 81 72 465 Chemical 94 91 3 292 Others 5 24 (80) 257 Standalone EBITDA 238 196 21 1,013 Subsidiaries Cement 1,282 1,296 4,776 Textiles 5 8 (29) 33 Pulp JVs and Fibre JVs (Pro Rata) (1) (28) 22
Slide 30: Viscose Staple Fibre: Summary
Viscose Staple Fibre : Summary Quarter 1 Full Year % Change 2015-16 2014-15 2014-15 Capacity* TPA 1,24,550 94,440 32 4,33,600 Production MT 93,541 89,827 4 4,08,332 Sales Volumes MT 1,02,737 86,389 19 4,02,802 Net Revenue ` Cr. 1,254 1,094 15 4,974 EBITDA ` Cr. 139 81 72 465 EBITDA Margin % 11.0% 7.
Slide 31: Chemical: Summary
Chemical : Summary Quarter 1 % Full Year 2015-16 2014-15 Change 2014-15 Capacity TPA 1,13,125 1,13,125 - 4,52,500 Production MT 99,463 1,00,163 (1) 4,11,738 Sales Volumes MT 98,055 97,678 - 4,09,220 Net Revenue ` Cr. 485 414 17 1,701 EBITDA ` Cr. 94 91 3 292 EBITDA Margin % 19.3% 22.0% -- 17.1% EBIT
Slide 32: Cement: Summary
Cement : Summary Quarter 1 % Full Year 2015-16 2014-15 Change 2014-15 Grey Cement Capacity Mn. TPA 15.80 15.43 2 63.15 Production Mn. MT 12.85 12.04 7 46.71 Cement Sales Volumes $ Mn. MT 12.87 12.17 6 47.09 Clinker Sales Volumes Mn. MT 0.08 0.25 (68) 1.08 White Cement & Putty Sales Volumes $$ Lac MT
Slide 33: Grasim Group Structure
Grasim Group Structure Pulp & Fibre Chemical UltraTech Cement (60.25%) Others VSF VSF JV Pulp Overseas Caustic Epoxy Domestic Overseas 498K TPA China 70K TPA Pulp JVs 452K TPA 51K TPA 3 Mn. TPA, (UAE, Bangladesh, Sri Lanka) Grasim Nagda Birla Jingwei Harihar AV Cell Nagda Grey Cement Bhiwani 162K TP
Slide 34: Plant Locations – Grasim & its subsidiaries
Plant Locations– Grasim & its subsidiaries Bathinda(G) Panipat Bhiwani Dadri T Kotputli Aligarh Jodhpur P T Malanpur Shambhupura Jawad P Katni Sewagram Bharuch Durgapur(G) UltraTech Cement Plants Wanakbori F Jafrabad F C Vilayat UltraTech Grinding Units (G) F C Pipavav Nagda Hirmi Raipur Magdalla (G
Slide 35: Cautionary Statement
Cautionary Statement Statements in this “Presentation” describing the Company’s objectives, estimates, expectations or predictions may be “forward looking statements” within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expressed or impl
Slide 36: Unaudited Consolidated Financial Results Q1 2015-16
UNAUDITED CONSOLIDATED FINANCIAL RESULTS FOR THE QUARTER ENDED 30-06-2015 PART I: STATEMENT OF CONSOLIDATED UNAUDITED RESULTS FOR THE QUARTER ENDED 30-06-2015 ` Crore Three Months Ended Year Ended 30-06-2015 31-03-2015 30-06-2014 31-03-2015 Particulars (Unaudited) (Audited) (Unaudited) (Audited) (Re
Slide 37: Consolidated Segment Wise Revenue, Results and Capital Employed
UNAUDITED CONSOLIDATED SEGMENT WISE REVENUE, RESULTS AND CAPITAL EMPLOYED FOR THE QUARTER ENDED 30-06-2015 ` Crore Particulars Three Months Ended Year Ended 30-06-2015 31-03-2015 30-06-2014 31-03-2015 (Unaudited) (Audited) (Unaudited) (Audited) (Refer Note 8) 1. SEGMENT REVENUE Viscose Staple Fibre
Slide 38: Notes to Financial Results
Grasim Industries Limited NOTES: 1. a. The Company has opted to publish Consolidated Financial Results which are reviewed by the Audit Committee and approved by the Board of Directors today. b. Key numbers of Standalone Financial Results of the Company are as under: ` Crore Three Months Ended Year E
Slide 39: Notes to Financial Results (continued)
Grasim Industries Limited 5. Exceptional item for the quarter and year ended 31st March 2015 represents provision made towards impairment of assets of Birla Lao Pulp and Plantation Company Ltd., a JV of the Company. 6. During the quarter, the Company has allotted 1,608 fully paid up equity shares of
Slide 40: Press Release: Improved performance for Q1 FY16
Press Release Mumbai, 7th August, 2015 Improved performance for Q1 FY16 led by substantial investments across Businesses Consolidated Financial Performance ` Crore Quarter ended 30.06.2015 30.06.2014 Net Revenue 8,599 8,045 7% EBITDA 1,531 1,488 3% Net Profit 485 487 Grasim has reported improved per
Slide 41: Outlook
Outlook In the VSF business, prices are likely to be influenced by the development in the industry in China amidst increase in the input prices and resumption of operations at some of the shut capacities. The Company’s new plant at Vilayat with a higher share of speciality product will improve its p
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