APAR Industries Limited · NSE:APARINDS
APAR Industries — Investor Presentation (May 2018)
38 slides from APAR Industries's investor presentation, May 2018
Slide 1: Apar Industries Ltd. Corporate Presentation
Corporate Presentation Apar Industries Ltd. Corporate Presentation May 2018 1 AparApar IndustriesLimited Industries Limited Corporate CorporatePresentation Presentation
Slide 2: Company Overview
Company Overview Company Overview 2 Apar Industries Limited Corporate Presentation
Slide 3: Global leader in Conductors and Transformer Oils
Global leader in Conductors and Transformer Oils 3rd largest manufacturer of Conductors, 4th largest manufacturer of transformer oil Market Leadership in the world and largest manufacturer of domestic cable in renewable Sector. Over 400 types of specialty & automotive oils; largest range of conventi
Slide 4: Strong presence across diverse businesses
Strong presence across diverse businesses Conductors Specialty Oils Cables Auto Lubes Since 1958 Since 1969 Since 2008 Since 2007 23% market share 45% market share Acquired Uniflex in Renewed focus in auto Total Capacity: Total Capacity: 2008. Grew sales from lubes with licensing 180,000MT. Shifted
Slide 5: And multiple growth drivers in place
And multiple growth drivers in place Power Sector High Focus on Transmission & Distribution (T&D) Govt thrust on Renewable Energy • 13th Plan is estimated to involve an investment of Rs 2.6 tn • India has a 175 gigawatt (GW) clean which includes addition of ~100,000 CKM of transmission lines energy
Slide 6: Strategic investments to drive future growth
Strategic investments to drive future growth Strategic investments of Rs 660+ crore since FY13 for innovative/higher value added products. Conductors - Rs 267 crore • Commissioned Jharsuguda (Odisha) plant with 30,000 MT capacity in Sep’16, Further shifted 50,000 MT to Jharsuguda Plant (Total - 80,0
Slide 7: Transient impact on margins due to GST, raw material prices and new facilities
Transient impact on margins due to GST, increase in raw material prices and commencement of new facilities Margins expected to improve in FY19 - better product mix along with lower costs due to molten metal agreement with Hindalco, scaling up of new plants and stabilization of GST EBITDA* / Margin P
Slide 8: Segmental Performance
Segmental Performance Company Overview 8 Apar Industries Limited Corporate Presentation
Slide 9: Conductors: Largest manufacturer and exporter from India
Conductors: Largest manufacturer and exporter from India • Revenue increased 14% YoY to reach Rs 2,567 crore in FY18 due to Volume (In ‘000 MT) strong growth in H2 that offset lower growth in H1 due to bottleneck caused by GST 12% CAGR (FY14-18) • EBITDA / MT, post FX, down 34% YoY due to raw materi
Slide 10: Driving growth through key strategic initiatives
Driving growth through key strategic initiatives Developments for FY19 • Order book at Rs 1,209 Crore as on Mar’18; Exports orders contribute 47% • In FY19 the HEC business is expected to pick up • Expected to start new business of Copper conductors for Railways • Received approvals for conductors f
Slide 11: Specialty Oils: Continued leadership with a global footprint
Specialty Oils: Continued leadership with a global footprint • Revenue increased 27% YoY to reach Rs 2,162 crore from Volume (In ‘000 KL) Rs 1,699 crore in FY17 driven by record sales in 4% CAGR transformer oil, white oil, industrial oil and automotive oils 389 327 328 338 353 • Volume at 3,88,513 K
Slide 12: Driving growth through capacity expansion and value added products
Driving growth through capacity expansion and value added products Developments for FY19 • Only Indian company to win new business to supply all the major HVDC projects with transformer oil in FY19 & FY20 • Order of 10,000+ KL won from ABB and GE • Margins to improve in FY 19 with better product mix
Slide 13: Auto Lubes: Strategic partnership & aggressive marketing driving growth
Auto Lubes: Strategic partnership & aggressive marketing driving growth • Manufacturing and license agreement with ENI S.P.A to manufacture Riding the High road with ENI ENI branded lubricants, positioned at upper end of the market. • Best in Class lubricants delivering great “Performance and Protec
Slide 14: Cables: Continues ahead on a profitable growth path
Cables: Continues ahead on a profitable growth path Revenue (In Rs Crore) • Revenue increased 29% YoY to reach Rs 1,116 crore driven by high demand from solar sector 18% CAGR 1,116 • Strong growth in sub segments: power cables up 864 68% and optical fibre cables grew by 18%. 675 573 560 Elastomeric
Slide 15: New opportunities in the cables business
New opportunities in the cables business Developments for FY19 • Exploring new opportunities in MVCC, Auto Cables & Railway harnesses. • Started getting approval for E-beam Auto cables • Enter Railway harness business as Railways is planning to source harnesses • Got approval from Railways to supply
Slide 16: Power Sector Overview
Power Sector Overview Company Overview 16 Apar Industries Limited Corporate Presentation
Slide 17: Power sector expected to turnaround post recent govt initiatives
Power sector expected to turnaround post recent govt initiatives Power sector expected to receive investment of about $1 trillion by 2030 • With Increasing Generation capacity and healthy pipeline of Installed capacity nears 350 GW projects in the construction phase, SEB’s weak financial health 15%
Slide 18: UDAY- biggest policy initiative towards Ujwal Bharat
UDAY- biggest policy initiative towards Ujwal Bharat • Debt Take over by State resulting in Reduction in Interest Cost • Lower cost of Power Highlights • Operational Efficiency • Enabling Quarterly Tariff Increase • Reduction of AT&C loss to 15% in 2018-19 from 32% in 2013-14 Expected • Reduction in
Slide 19: Govt's focus on transmission and distribution to drive growth
Govt’s focus on transmission and distribution to drive growth End of End of 12th As on End of System Type End of 10th plan 11th plan plan(Target) Mar'18 13th plan AC transmission Lines(In C Kms) 1,92,535 2,48,049 3,48,049 3,75,414 4,50,700 HVDC (In C Kms) 5,872 9,432 16,872 15,556 19,815 Total (In C
Slide 20: High voltage conductors & transformers to boost demand
High voltage conductors & transformers to boost demand Planned improvements in transmission sector Expected transmission lines by Govt 2,03,644 1,57,644 • High capacity 400kV multi-circuit/bundle conductor lines. 1,06,819 • High Surge Impedance Loading (HSIL) Line. 56,731 • Increase in current High
Slide 21: Financial Performance
Financial Performance Company Overview 21 Apar Industries Limited Corporate Presentation
Slide 22: FY18 revenue growth in all segments
FY18 revenue growth in all segments – Cables (29%), Speciality Oils (27%) and Conductors (14%) Consolidated Revenue Revenue Geographic Break-up Exports grew at 7% CAGR 3,297 3,336 3,297 3,736 3,062 5,823 5,122 5,082 4,840 2,087 4,632 1,825 Export, 1,570 1,744 1,544 36% Domesti c, 64% FY14 FY15 FY16
Slide 23: Transient impact on FY18 margins
Transient impact on FY18 margins Figures in Rs Crore, Consolidated Financials EBITDA / Margin PAT / Margin 550 6.5% 4.9% 7.2% 8.8% 7.1% 10.0% 240 2.4% 1.9% 2.4% 3.6% 2.5% 5.0% 1.0% 450 425 412 0.0% 176 190 0.0% 367 145 350 301 -10.0% 121 254 110 140 -5.0% 250 -20.0% 90 90 -10.0% 150 -30.0% 49 40 -15
Slide 24: Strong Balance Sheet
Strong Balance Sheet Stringent credit control systems in place. . . FY14 FY15 FY16 FY17 FY18 Debtor Days 87 90 78 95 108 Inventory Days 80 67 55 75 76 Payables Days 108 112 100 134 160 Low debt /equity ratio. . . FY14 FY15 FY16 FY17 FY18 Current Ratio 1.2 1.2 1.2 1.2 1.2 D/E 0.1 0.1 0.1 0.3 0.3 Inte
Slide 25: Annexure
Annexure Company Overview 25 Apar Industries Limited Corporate Presentation
Slide 26: Key Milestones
Key Milestones Commissionin g of Sharjah Plant; Signed agreement with Hindalco for Conductors Set up Conductors Conducto Plant in rs plant Jharsuguda Acquired Installed 2 E- set up at Entered into Uniflex Global Beam Athola Auto Lubes Cables to Presence Accelerators segment via diversify in 100 lice
Slide 27: Wide and deep product mix
Wide and deep product mix Conductors Specialty Oils Cables Auto Lubes High Efficiency Transformer Oils For Power TACSR Auto Lubes insulation & cooling Power Cables Diesel Engine Oils for STACIR Rubber Processing Oil: Elastomeric and Flexible Commercial and GZTACSR For Tyre & Polymer Ind Cables Agric
Slide 28: Huge global presence driving exports
Huge global presence driving exports Presence in 100 countries, Exports contributing 36% to FY18 Revenue Adopted a hub and spoke manufacturing and distribution model for specialty oils - allows efficient delivery cycles to global transformer OEM’s across Asia, Africa and Australia Presence in ov
Slide 29: Strategically located manufacturing units a big strength
Strategically located manufacturing units a big strength Proximity to major ports gives strategic advantage for exports Orissa Gujarat Maharashtra Manufacturing Units. Rabale (Maharashtra), Silvassa & Athola (Union Territory of Dadra and Nagar Haveli), Umbergaon & Khatalwad (Gujarat) Jharsuguda (Ori
Slide 30: Strong clientele with long lasting relationships
Strong clientele with long lasting relationships 30 AparApar IndustriesLimited Industries Limited Corporate CorporatePresentation Presentation
Slide 31: Annexure: Financials
Annexure: Financials Company Overview 31 Apar Industries Limited Corporate Presentation
Slide 32: Consolidated Profit & Loss Statement (Historical)
Consolidated Profit & Loss Statement (Historical) FY14 FY15 FY16 FY17 FY18 Revenue from operations (net) 4,632 5,122 5,551 5,289 5,939 Other income 4 2 10 16 11 TOTAL REVENUE (i) 4,636 5,124 5,562 5,305 5,950 EXPENSES: Cost of Raw Materials 3,675 4,085 3,905 3,573 4,495 Employee benefits expense 67
Slide 33: Consolidated Balance Sheet Statement (Historical)
Consolidated Balance Sheet Statement (Historical) (In Rs Cr) FY14 FY15 FY16 FY17 FY18 Liabilities Total Shareholder's Funds 696 730 854 1,036 1,108 Minority Interest 2 1 Non-current Liabilities: (a) Long-term borrowings 70 95 84 91 162 (b) Deferred tax liabilities (net) 23 27 31 46 35 (c) Other-long
Slide 34: Q4 FY18: Consolidated Profit & Loss Statement
Q4 FY18: Consolidated Profit & Loss Statement % Chg Particulars (Rs crore) Q4 FY18 Q4 FY17 % Chg YoY Q3 FY18 % Chg QoQ FY18 FY17 YoY Total Operating Income 1,767.5 1,419.3 24.5%* 1,498.9 17.9% 5,938.7 5,288.8 12.3% Total Expenditure 1,641.7 1,321.2 24.3% 1,401.3 17.2% 5,531.2 4,872.1 13.5% Cost of R
Slide 35: Q4 FY18 Key Ratios- Consolidated
Q4 FY18 Key Ratios- Consolidated Key Ratios (%) Q4 FY18 Q4 FY17 Q3 FY18 FY18 FY17 EBITDA Margin 7.3% 7.9% 6.7% 7.2% 9.0% Net Margin 2.3% 3.1% 2.6% 2.5% 3.7% Total Expenditure/ Total Net Operating Income 92.9% 92.5% 93.5% 93.0% 91.4% Raw Material Cost/ Total Net Operating Income 77.2% 75.0% 79.2% 77.
Slide 36: Q4 FY18: Consolidated Segment Analysis
Q4 FY18: Consolidated Segment Analysis Segment (Rs crore) Q4 FY18 Q4 FY17 %YoY Q3 FY18 % QoQ FY18 FY17 % Chg YoY Revenue Conductors 894.2 636.5 40.5% 638.6 40.0% 2,615.5 2,461.5 6.3% Transformer & Specialty Oils 532.3 478.9 11.2% 568.4 -6.4% 2,162.2 1,881.0 14.9% Power & Telecom Cables 335.9 298.0 1
Slide 37: Shareholding pattern
Shareholding pattern As on March 31, 2018 Outstanding shares – 3,82,68,619 Others, 10.32% Major Non-Promoter Shareholders Shareholding (%) Bodies Corporate, HDFC Trustee company 7.87 3.01% Reliance Capital 6.19 Mutual Funds, Goldman Sachs 2.96 21.34% L & T Mutual Fund 2.50 Promoter, 57.96% Raiffeise
Slide 38: Contact us
Contact us For any Investor Relations queries, please contact: Sanjaya Kunder Lokesh Bhati Seema Shukla Apar Industries Ltd Phone: +91 98731 32107 Phone: +91 124 425 1443 Phone: +91 22 67800400 lokesh.bhati@four-s.com seema@four-s.com Email: kunder@apar.com This presentation may have certain stateme