Vaibhav Global Ltd. · NSE:VAIBHAVGBL
Vaibhav Global — Q1 FY23 Earnings Presentation
48 slides from Vaibhav Global's earnings presentation, August 2022
Slide 1: Vaibhav Global Limited Q1 FY23 Financial Results Presentation
Vaibhav Global Limited Global E-tailer of Fashion Jewellery, Apparels, Lifestyle Products and Accessories on TV and Digital Platforms DELIVERING JOY Q1 FY23 Financial Results Presentation
Slide 2: MD's Message
The quarter gone by reflects effect of two macro environments: First is the opening up of economies after two years of travel restrictions led people to go out for revenge outings impacting all digital retailers like VGL. Secondly the high inflation in western economies constrained Commenting on Q1
Slide 3: Q1 FY23: Key Highlights
Q1 FY23 : KEY HIGHLIGHTS Softer revenue performance YoY amidst broader economic challenges. Grew 43% vs Q1 FY20 with 3 years CAGR of 13% Gross margins continue to be strong at 62% EBITDA margins in Q1 FY23, excluding Germany, were at 9.1% vs 14.4% last year. Margins impacted due to drop in gross mar
Slide 4: Table of Contents
TABLE OF CONTENTS 1 Business Background Details 2 Highlights for the Quarter 3 Q1 FY23 Financial Performance 4 Financial Performance Trends 5 Annexures Results Presentation, Aug 2022 4
Slide 5: Business Background Details
BUSINESS BACKGROUND DETAILS 5
Slide 6: Our Vision, Our Mission
GUIDING PILLARS THAT DEFINES VGL OUR VISION Team Work Be the Value Leader in Electronic Retailing of Jewellery & Lifestyle Products Positive Honesty Attitude Our Core Values OUR MISSION To deliver one million meals per day to children in need by ‘FY31’ through our one for Passion Commitment one meal
Slide 7: Corporate Overview
CORPORATE OVERVIEW Shop LC (US), Vertically- > End-to-end B2C business model Shop TJC (UK) > Presence on integrated and Shop LC > TV Homes accessed (*FTE): ~ 127 mn - Proprietary TV home-shopping & OTAs fashion retailer - Proprietary e-commerce platforms (Germany) are > Growing online presence on el
Slide 8: Truly Global
TRULY GLOBAL Retail Markets Shop LC | Shop TJC | Shop LC (US) (UK) (Germany) UK Germany Operate Through Marketplaces Canada US Sourcing China ▪ India ▪ UK ▪ China ▪ Mozambique ▪ Thailand ▪ Germany ▪ Indonesia ▪ Italy India ▪ ▪ Tanzania Russia ▪ ▪ Turkey Poland ▪ Morocco ▪ Singapore ▪ Myanmar ▪ UAE ▪
Slide 9: Completing 25 Years of Public Listing
COMPLETING 25 YEARS OF PUBLIC LISTING Growing Consistently Parameters CAGR Return FY 97 FY 22 (Rs. in crores) (25 years) (x times) Revenue 32.8 2,752.4 19.4% 84 EBITDA 4.2 303.2 18.7% 72 Profit Before Tax 4.1 242.3 17.7% 59 Profit After Tax 3.6 237.1 18.2% 66 Net Worth 17.7 1,126.8 18.1% 64 26.1% CA
Slide 10: Key Pillars
KEY PILLARS Results Presentation, Aug 2022
Slide 11: Key Pillars
KEY PILLARS Wider Higher Consumer & Wallet Product Share Bouquet Vertically Industry Leading Highest Integrated Gross Margin Supply Chain An Efficient Continuous Consumer Interplay of Omni-Channel Engagement Presence (Proprietary TV, OTA’s, OTT, Marketplaces & Strong Balance Sheet Social Media) In-H
Slide 12: Pools of Product Verticals
2 POOLS OF PRODUCT VERTICALS Huge Opportunity: Immediate Addressable Market of ~USD 20 bn Life-Style, Home Décor, Fashion Jewellery, Beauty Care, Apparels & Gemstones & Accessories Accessories Results Presentation, Aug 2022
Slide 13: Vertically Integrated Supply Chain
VERTICALLY INTEGRATED SUPPLY CHAIN ASIAN BASE Serving WESTERN COUNTRIES ➢ Vertically integrated supply-chain in Asia Primary Retail Markets ➢ Low-cost manufacturing and value sourcing base ➢ Serving affluent but value-conscious customers in Western Developed Markets USA UK China Bali Thailand German
Slide 14: Omni-Channel Sales Platform
OMNI-CHANNEL SALES PLATFORM TV DIGITAL Proprietary TV channels and OTAs Proprietary Digital Platform Mobile Applications US UK GERMANY www.shoplc.com www.tjc.co.uk www.shoplc.de HH: 73mn 27mn 27mn* Third Party Marketplaces Social Retail OTA: 17mn 18mn 2.5mn Google Marketplace * Including 2mn HH in A
Slide 15: Strengthening Private Label Brands
STRENGTHENING PRIVATE LABEL BRANDS USA UK Germany ➢ Our Strength: • Leveraging manufacturing & digital capabilities • Number of PL brands: 31 • Revenue Mix: ~25% of global B2C revenue • Margin accretive • Brand Laddering (value and mass-premium) ➢ Long-Term Objectives: • Focus on ‘IPR’ rights for br
Slide 16: 4R's of Customer Engagement
4R’S OF CUSTOMER ENGAGEMENT TV: Diverse Products Enduring relationships Linear | OTA Expanding wallet share Digital: Deep value proposition Convenience Browsers | Mobile Apps | Cross-selling Market-places | OTT| Social Media Engrossing Content Digitalization/AI Reach (HH) Registrations Retention Rep
Slide 17: Consistent Delivery
CONSISTENT DELIVERY Strong Execution Focussed Consistent Global Households Reach Repeat Purchases Retention (in million) (no. of pieces) (20+ Purchases) 124 127 89.1% 89.3% 88.9% 30 88.1% 99 104 27 27 26 FY20 FY21 FY22 Jun-22 FY20 FY21 FY22 Jun-22 FY20 FY21 FY22 Jun-22 Reach Repeat Purchases Retenti
Slide 18: 'Delivering Joy' Through Innovation
‘DELIVERING JOY’ THROUGH INNOVATION INNOV8 FUNNEL Ideas Received Ideas Proposed to Buyers Ideas Approved by Buyers Orders Placed Products sold • An initiative to foster entrepreneurship within the organization at channels • Recently, 5 business ideas have been shortlisted for incubation • A launchpa
Slide 19: Constantly Reimagining Growth with New Designs & Products
CONSTANTLY REIMAGINING GROWTH WITH NEW DESIGNS & PRODUCTS Jewellery Design Gemstones ➢ Deals in 250+ gemstones including rare gemstones ➢ Widest possible global sourcing ➢ New gemstones contributing 3%-4% of group’s annual turnover ➢ Strengths: ➢ Strong team of professional designers ▪ In-house Test
Slide 20: Broad Based E-tailer
BROAD BASED E-TAILER B2C Revenues by Format B2C Revenues by Product Category TV revenues Digital revenues Jewellery Non-jewellery revenues 22% 11% 37% 36% 30% 28% 78% 63% 64% 89% 72% 70% FY17 FY22 Q1 FY23 FY17 FY22 Q1 FY23 60.5% of digital revenues in Q1 FY22 were from Mobile platform Jewellery reve
Slide 21: Highlights for the Quarter
HIGHLIGHTS FOR THE QUARTER Results Presentation, Aug 2022
Slide 22: Recent Trends Showing Visible Improvement
RECENT TRENDS SHOWING VISIBLE IMPROVEMENT Q1 performance reflects impact of otherwise Recent revenue trend improving elevated base of 2 years owing to COVID month-over-month Q1 Q1 Q1 Q1 FY20 FY21 FY22 FY23 Net Revenue 440 550 682 628 (Rs. in crores) YoY growth (%) 25% 24% -8% -5.2% Growth over 43% -
Slide 23: UK: Freeview Channel Upgradation Yielding Positive Outcomes
UK: FREEVIEW CHANNEL UPGRADATION YIELDING POSITIVE OUTCOMES TJC (UK) upgraded channel position to 22nd from erstwhile 50th position in Jan-22 Investment now yielding positive results in terms of new customer acquisition on TV Expect market leading growth in the long run New TV Customer Acquisition (
Slide 24: Germany: Performance Reassuring Our Investment
GERMANY: PERFORMANCE REASSURING OUR INVESTMENT Germany venture increased TAM (Total Addressable Market) by ~20% Revenue and Unique Customers Trend 1000000 8000 800000 6000 600000 4000 400000 200000 2000 Omni-Channel Presence 0 0 Net Revenue (Euro) Unique customers (nos.) ➢ Good revenue traction and
Slide 25: OTT: Leveraging and Widening Digital Platform
OTT: LEVERAGING AND WIDENING DIGITAL PLATFORM Shop LC (USA) New Launch – Live Marketing & & Interactive Apps Engagement Roku & Unique OTT Customers 4,000 Apple TV 3,000 The in-app Pop-up marketing has 2,000 four use cases & has started 1,000 with the 1st case on Roku • Message to all devices 0 Q1 Q2
Slide 26: Q1 FY23 Financial Performance
Q1 FY23 FINANCIAL PERFORMANCE 26
Slide 27: Financials – Q1 FY23 Performance
FINANCIALS – Q1 FY23 PERFORMANCE Revenue Breakdown – (Rs. crore) Fashion Jewelry, Accessories & Lifestyle Products Growth vs Q1 FY20 Growth vs Q1 FY20 Growth vs Q1 FY20 42.7% 40.7% 59.8% Revenue TV Revenue Digital Revenue B2B Revenue 7.9% 682 426 9.6% 628 386 9.2% 243 220 76.3% 22 13 Q1 FY
Slide 28: Recent Performance Attributed to Higher Base of Years
RECENT PERFORMANCE ATTRIBUTED TO HIGHER BASE OF 2 YEARS Shop LC (US) Shop TJC (UK) Q1 Revenue: 4 years trend & YoY Growth Q1 Revenue: 4 years trend & YoY Growth 31.5% 21.1% 20.3% 21.2% 20.8 3 Years CAGR: 10% 3 Years 17.1 17.5 61.8 CAGR: 8% 53.9 13.0 51.0 42.4 Revenue in USD Revenue in GBP Q1 FY2
Slide 29: Retail Performance Trends – Q1 FY23
RETAIL PERFORMANCE TRENDS – Q1 FY23 Volume and ASP TV Sales Sales Volume ('000s) Average Selling Price US$ 37.4 1,964 29.5 1,340 Q1 FY22 Q1 FY23 Q1 FY22 Q1 FY23 Digital Sales Sales Volume ('000s) Average Selling Price US$ 1,382 23.8 24.5 1,169 Q1 FY22 Q1 FY23 Q1 FY22 Q1 FY23 Results Presentation, Au
Slide 30: Financials – Q1 FY23 Performance
FINANCIALS – Q1 FY23 PERFORMANCE Profits – (Rs. crore) Gross Profit EBITDA Gross 65.0% 62.0% EBITDA 14.4% 7.0% Margin (%) Margin (%) 12.2% Ex-Germany: 444 98 Margins:9.1% 390 55.2% 44 Q1 FY22 Q1 FY23 Q1 FY22 Q1 FY23 PAT* EPS (Rs.) – Post split PAT Margin (%) 14.5%* 3.1%** 6.07 99 80.2%** 20 1.
Slide 31: EBITDA Margin Walk
EBITDA MARGIN WALK % To Particulars Revenue Remarks EBITDA Q1 FY22 14.4% Gross Margin (3.0%) Product mix and deferred price transition Initial losses in Germany. To breakeven by H2 of Investment in Germany (2.2%) FY24 Accelerated Investment in Digital & Continued investments to acquire more TV & O
Slide 32: Cost Optimisation
COST OPTIMISATION Annual Visible Savings (FY23) Cost • Presently ~50-60% volume of US & UK catered Arbitrage: by India $ 1-2 mn Call Centre • Focus to further increase India’s share in future • Shipping: Renegotiating and evaluating new vendors Shipping & • Labour productivity Warehousing $ 2-3 mn •
Slide 33: Financial Performance Trends
FINANCIAL PERFORMANCE TRENDS 33
Slide 34: Financial Performance Trends
FINANCIAL PERFORMANCE TRENDS Revenue Breakdown – (Rs. crore) Revenue 5 Year CAGR: 13.9% 2,752 Growth vs Q1 FY20 2,540 42.7% 1,814 1,986 1,571 7.9% 682 628 FY18 FY19 FY20 FY21 FY22 Q1 FY22 Q1 FY23 Fashion Jewelry, Accessories & Lifestyle Products Growth vs Growth vs Q1 FY20 Q1 FY20 40.7% 59.8% T
Slide 35: Retail Performance Trends
RETAIL PERFORMANCE TRENDS Volume and ASP TV Sales Sales Volume ('000s) Average Selling Price US$ 37.4 7,837 29.9 32.6 29.5 6,275 6,998 27.0 26.4 27.7 5,737 6,070 1,964 1,340 FY18 FY19 FY20 FY21 FY22 Q1 FY22 Q1 FY23 FY18 FY19 FY20 FY21 FY22 Q1 FY22 Q1 FY23 Digital Sales Sales Volume ('000s) Average S
Slide 36: Financial Performance Trends
FINANCIAL PERFORMANCE TRENDS Profits – (Rs. crore) Gross Profit EBITDA Gross EBITDA Margin (%) 59.6% 62.5% 61.6% 62.3% 62.3% 65.0% 62.0% Margin (%) 10.1% 12.0% 13.9% 15.3% 11.0% 14.4% 7.0% 1,714 1,583 CAGR: 24.3% Ex-Germany: 1,133 1,224 388 Margins:9.1% 936 12.2% 303 276 217 55.3% 444 390 159 98
Slide 37: Financial Performance Trends
FINANCIAL PERFORMANCE TRENDS Balance Sheet – (Rs. crore) Shareholders’ Equity Fixed assets including intangibles 1,127 1,167 494 492 964 697 751 550 192 120 117 163 FY18 FY19 FY20 FY21 FY22 Q1 FY23 FY18 FY19 FY20 FY21 FY22 Q1 FY23 Net Debt Net Assets * FY18 FY19 FY20 FY21 FY22 Q1 FY23 540 560 (13) 4
Slide 38: Financial Performance Trends
FINANCIAL PERFORMANCE TRENDS Cash Flow – (Rs. Crore) Operating Cash flow Free Cash Flow 324 268 181 176 203 211 82 86 68 38 32 20 18 (214) FY18 FY19 FY20 FY21 FY22 Q1 FY22 Q1 FY23 FY18 FY19 FY20 FY21 FY22 Q1 FY22 Q1 FY23 Cashflow reflecting impact of lower profitability though improved sequentially
Slide 39: Financial Performance Trends
FINANCIAL PERFORMANCE TRENDS Key Ratios ROE (TTM) ROCE (TTM) 32% 61% 26% 25% 23% 23% 46% 37% 31% 14% 27% 22% FY18 FY19 FY20 FY21 FY22 Q1 FY23 FY18 FY19 FY20 FY21 FY22 Q1 FY23 Return ratios imply effect of conscious investments on affiliates, digital marketing and Germany’s impact Note - ROE – based
Slide 40: Annexures
ANNEXURES 40
Slide 41: Updates on Digital Commerce Markets
UPDATES ON DIGITAL COMMERCE MARKETS E-com Industry facing temporary headwinds with declining sales mix in the USA and the UK US Retail & E-com Sales UK Retail & E-Com Sales Retail Sales ($ Tn) E-com as % of Retail Sales Retail Sales (£ Bn) E-com as % of Retail Sales 6.5 464.3 14.0% 439.6 436.8 423.7
Slide 42: Robust Corporate Governance
ROBUST CORPORATE GOVERNANCE RECOGNITIONS & ACCOLADES Q1 FY23 Rs. 24.7 cr Excellence Award’ for ‘IGBC Performance Challenge 2021 for Green Built Environment GPTW Best Leaders in Times of Crisis 2021 Interim Dividend Dividend Payout Policy > 20-30% of consolidated free cash flow > Higher payout in spe
Slide 43: Sustainability Initiatives
SUSTAINABILITY INITIATIVES ENERGY WATER Solar 81.7 Lakh KWH generated 6100 KL Rainwater per annum harvested 3.23 MW since inception EV 84 2-Wheelers & 3 4- 7KL Water saved per day with the installation of wheelers for employee low LPM faucets commute 48KL Water recycled per day, IGBC Performance Cha
Slide 44: Community Giveback
COMMUNITY GIVEBACK > Till date Served 67 million meals to Social Initiatives underprivileged children through flagship One for Providing resources for healthcare services: One Program, ’Your Purchase Feeds…’ > Distributed 117 Oxygen Concentrators, 31 BIPAP and other key medical equipment in hospital
Slide 45: VGL Shareholder Base: As on 30-June-2022
VGL SHAREHOLDER BASE: AS ON 30-JUNE-2022 Shareholding Pattern Holding as on Key Shareholders (Holding >1%) 30-June-22 Others 9.15% Promoter & Promoter Group 57.96% Individual - >1% 3.17% Nalanda India Fund Limited (FII) 10.22% AIF 1.37% Motilal Oswal Flexi Cap Fund (MF) 6.78% Domestic Institutions (
Slide 46: Management Team
MANAGEMENT TEAM Mr. Sunil Agrawal Mr. Vineet Ganeriwala Mr. Srikant Jha Mr. Ankur Sogani Managing Director, VGL Group CFO, VGL Group Mr. Deepak Sharma Managing Director, Vice President, Commercial, Vice President, Owned Shop TJC (UK) Shop LC (US) Brands, Shop LC (US) Mr. Deepak Mishra Mr. Raj Singh
Slide 47: Safe Harbour
Safe Harbour This presentation contains “forward looking statements” including, but without limitation, statements relating to the implementation of strategic initiatives, and other statements relating to Vaibhav Global Limited (VGL) and its affiliated companies’ future business developments and eco
Slide 48: Results Presentation, Aug 2022
Results Presentation, Aug 2022