Sarda Energy & Minerals Limited · NSE:SARDAEN
Sarda Energy & Minerals — H1FY23 Earnings Presentation
45 slides from Sarda Energy & Minerals's earnings presentation, November 2022
Slide 1: Sarda Energy and Minerals Limited
Sarda Energy and Minerals Limited ‘It’s Energy and Minerals, Not Only Steel’ Investor Presentation | Q2 & H1FY23
Slide 2: Safe Harbour Statement
Safe Harbour Statement This presentation and the accompanying slides (the “Presentation”), which have been prepared by Sarda Energy & Minerals Ltd (the “Company”) solely for information purposes and do not constitute any offer, recommendation or invitation to purchase or subscribe for any securities
Slide 3: Table of Contents
Table of Contents 1 Q2 & H1FY23 - Key Highlights 2 SEML – Beyond Steel 3 Business Segments 4 Corporate Social Responsibility 5 Financials ‘It’s Energy and Minerals, Not Only Steel’ 3
Slide 4: Q2 & H1FY23 Key Highlights
an Q2 & H1FY23 | Key Highlights
Slide 5: Robust Performance Amidst Challenging Environment
Robust Performance Amidst Challenging Environment Revenue From Operations Operating EBITDA* Margin (%) PAT^ Margin (%) Standalone (INR Cr) 819 360 186 688 266 177 592 270 153 189 190 28% 180 25% 32% 33% 19% 90 28% 0 Q2FY22 Q1FY23 Q2FY23 Q2FY22 Q1FY23 Q2FY23 Q2FY22 Q1FY23 Q2FY23 Consolidated (INR Cr)
Slide 6: Improvement in Debt Profile and Credit Rating
Improvement in Debt Profile and Credit Rating Gross Debt Net Debt* SEML - Credit Ratings – Upward Trajectory Standalone (INR Cr) 391 295 270 345 171 152 240 174 (127) (301) FY19 FY20 FY21 FY22 H1FY23 Consolidated (INR Cr) Gross Debt Net Debt* 1,687 1,714 1,581 1,395 1,379 Name of Subsidiary Reviewed
Slide 7: Update on Ongoing Projects
Update on Ongoing Projects Backward Integration: To ensure Consistent Supply and Stable Prices ➢ Gare Palma IV/7 Coal Mine, Chhattisgarh ✓ Capacity expansion from 1.2 MTPA to 1.8 MTPA – mining plan approved ➢ Shahpur West Coal Mine, Madhya Pradesh ✓ Extractable reserves of 13.4 MT and Production cap
Slide 8: Consolidated P&L Highlights
Consolidated P&L Highlights INR in Cr Q2FY23 Q2FY22 YoY Q1FY23 QoQ H1FY23 H1FY22 YoY Revenue from Operations 967 1,025 -6% 1,261 -23% 2,228 1,857 20% Other Income 21 31 -39 -18 29 Total Income 988 1,056 -6% 1,222 -19% 2,210 1,886 17% Raw Material 513 487 723 1,236 955 Employee Expenses 33 26 32 65 5
Slide 9: Standalone P&L Highlights
Standalone P&L Highlights INR in Cr Q2FY23 Q2FY22 YoY Q1FY23 QoQ H1FY23 H1FY22 YoY Revenue from Operations 688 592 16% 819 -16% 1,507 1,210 25% Other Income 61 51 -32 29 48 Total Income 749 643 16% 788 -5% 1,536 1,259 22% Raw Material 396 331 463 859 682 Employee Expenses 23 18 24 48 36 Other Operat
Slide 10: Balance Sheet Highlights
Balance Sheet Highlights Consolidated Standalone Consolidated Standalone Liabilities (INR Cr) Assets (INR Cr) Sep-22 Mar-22 Sep-22 Mar-22 Sep-22 Mar-22 Sep-22 Mar-22 Shareholder’s Funds 3,161 3,004 2,803 2,643 Non-Current Assets 3,197 3,139 1,818 1,796 Share capital 35 36 35 36 Property, plant & equ
Slide 11: Consolidated Operating EBITDA Break-up
Consolidated Operating EBITDA Break-up Operating EBITDA Bridge (INR Cr) – Q2FY23 • The 113 MW Sikkim Hydro Power project was commissioned on June 30, 2021, resulting in a… • …Substantial jump in Hydro EBITDA… • …and a significant diversification of cashflow profile of the Company • SMAL EBITDA impac
Slide 12: Consolidated Debt Break-Up
Consolidated Debt Break-Up Debt Bridge (INR Cr) – As on Sept 30, 2022 804 4 1,379 • Majority of the Total Debt is on account of the Sikkim Hydro project, which is being repaid as per schedule 74 344 • Consolidated Net Debt stood at INR 703 Cr as on 152 Sept 30, 2022 St a nd a l o ne SM AL Hyd ro - H
Slide 13: Steel Segment - Product Price Trend
Steel Segment - Product Price Trend Iron Ore Pellet Sponge Iron Steel Billets Wire Rod H.B. Wire 2,784 677 1,818 3,295 4,136 4,897 2,454 2,315 2,348 3,061 3,266 3,246 1,337 18,888 18,124 INR / MT 15,340 4,497 1,878 13,774 2,297 14,380 12,453 Value 1,849 2,790 3,092 12,375 Addition 3,409 13,194 11,74
Slide 14: Steel Segment: Stable Demand Across Most Products
Steel Segment: Stable Demand Across Most Products Iron Ore Pellet (‘000 MT) Sponge Iron (‘000 MT) Steel Billet (‘000 MT) 143 102 400 128 Production 383 94 78 52 173 184 63 42 Q2FY22 Q2FY23 H1FY22 H1FY23 Q2FY22 Q2FY23 H1FY22 H1FY23 Q2FY22 Q2FY23 H1FY22 H1FY23 Iron Ore Pellets (‘000 MT) Sponge Iron (‘
Slide 15: Steel Segment: Focus on Selling Value-Added Products
Steel Segment: Focus on Selling Value-Added Products Wire Rod (‘000 MT) H. B Wires (‘000 MT) Ferro Alloys (‘000 MT) 19 74 86 68 80 Production 15 10 38 42 8 35 26 Q2FY22 Q2FY23 H1FY22 H1FY23 Q2FY22 Q2FY23 H1FY22 H1FY23 Q2FY22 Q2FY23 H1FY22 H1FY23 Wire Rod (‘000 MT) H. B Wires (‘000 MT) Ferro Alloys (
Slide 16: Power Segment - Generation & Sales
Power Segment - Generation & Sales Thermal Power + Waste Heat = Total Capacity 161.5 MW Hydro Power: Total Operational Capacity ~143 MW G E NE RATIO N ( M N KWH) G E NE RATIO N ( M N KWH) 528 368 485 271 289 229 264 178 Q2F Y22 Q2F Y23* H 1F Y22 H 1F Y23 Q2F Y22 Q2F Y23* H 1F Y22 H 1F Y23 SALE S ( M
Slide 17: Key Strategies to Drive Growth and Competitive Advantage
Key Strategies to Drive Growth and Competitive Advantage Backward Integration Capacity Expansion Diversification Adding Annuity-like Revenue Stream (Hydro) Reduce Input Costs and Ensure Consistent Supply • Ferro Alloys capacity expansion by 36 MVA (installation completed) to 147 MVA, likely • Commer
Slide 18: SEML | Beyond Steel
SEML | Beyond Steel 18
Slide 19: Robust Business Model with Diversified Business
Robust Business Model with Diversified Business Adding Value through Minerals and Energy MINERALS METALS HYDRO ✓ Captive Iron Ore mine and commercial Coal Mines ✓ Vast experience of over 49 years in Steel Manufacturing ✓ To de-risk from the cyclicality of Metals business, SEML provide long term stab
Slide 20: Strategically Located Assets – Proximity to Raw Materials and End Users
Strategically Located Assets – Proximity to Raw Materials and End Users… Iron Ore and Coal Mines located within ~140 km and ~200 km respectively, from the End-user plant at Chhattisgarh Captive Iron Ore Mine at Rajnandgaon, Chhattisgarh (rated capacity of 1.5 MMT p.a.) Coal Mine at Gare Palma IV 7,
Slide 21: Built Over Four Decades of Excellence
…Built Over Four Decades of Excellence 1979-89 1989-99 1999-08 2008-18 2018-22 ▪Acquired Raipur Wires and Steel as a ▪Installed 25 TPD Electric Arc Furnance ▪Company started 24 MW captive ▪4.8 MW Hydro power plant ▪Billet capacity increased by 50% sick unit in 1979 in 1990 power plant and Ferro Allo
Slide 22: Well-Experienced and Strong Leadership at the Helm
Well-Experienced and Strong Leadership at the Helm Kamal Kishore Sarda Pankaj Sarda CMD Joint MD • Mechanical Engineer with 45 years • Mechanical Engineer with 17 years experience in Iron and Steel Industry experience in Iron and Steel Industry • Responsible for the groups vision and • Responsible f
Slide 23: Business Segments
Business Segments 23
Slide 24: Metals and Mining Business | Vertically Integrated Steel Player
Metals and Mining Business | Vertically Integrated Steel Player… Raw Material & Energy Generation (Captively procured key inputs, assure cost and quality control) Raw Material & Energy Generation Iron Ore Mine | Coal Mine | Power Intermediate / Finished Products (Flexibility to sell products across
Slide 25: Backed by Captive Resources, Driving Down Costs Significantly
… Backed by Captive Resources, Driving Down Costs Significantly Captive Iron Ore Mine Two Coal Mines Captive Thermal + Waste Heat Plants (Total Capacity of 1.5 MMT p.a.) (Total Capacity of 1.8 MMT p.a.) (Total capacity of 161.5 MW) • Located at Rajnandgaon, Chhattisgarh, which is ▪ Gare Palma IV/ 7
Slide 26: Robust Presence Across Steel Products – Siltara Plant
Robust Presence Across Steel Products – Siltara Plant in Chhattisgarh… Pellets Sponge Iron Billets Wire Rods HB Wires Semi finished steel product Produced from captive Iron produced by continuous Hot rolled product made HB Wires- Wire rods are Produced from Iron Ore Ore Lumps & Pellets. Description
Slide 27: Leading Manufacturer and Exporter of Ferro Alloys
…And a Leading Manufacturer and Exporter of Ferro Alloys ▪ Manufactures manganese-based Ferro Alloys sold domestically as Domestic Sales ('000 MT) Exports ('000 MT) well exported to other countries ▪ Leading exporter of manganese-based Ferro Alloys ▪ Exports Awards: ▪ SMAL received prestigious expor
Slide 28: Hydro Power Business | Operational Assets of ~143 MW
Hydro Power Business | Operational Assets of ~143 MW… 4.8 MW 24.9 MW 113 MW Location Uttarakhand Chhattisgarh Sikkim Name of the River Sarju Gullu Rongnichu Year of 2008 2017 2021 Commissioning Tariff INR 3.85 per unit INR 5.21 per unit Final tariff under determination Term of PPA 30 -year PPA with
Slide 29: Track Record of Robust PLF and Annuity-like Revenue
…With Track Record of Robust PLF and Annuity-like Revenue + High Margin Generation and Sales (Mn KwH) Revenue (INR Cr) & EBITDA Margin (%) Generation Sales 417 400 100% 417 88% 86% 85% 90% 368 368 350 80% 80% 300 69% 271 70% 250 60% 200 200 50% 150 40% 129 129 115 115 30% 85 85 100 68 58 20% 45 50 1
Slide 30: Corporate Social Responsibility
Corporate Social Responsibility 30
Slide 31: Focus on Safety, Health & Social Responsibility
Focus on Safety, Health & Social Responsibility Health & Safety No. of Incidents Social Responsibility (including minor) 21 23 15 7 3 3 CY16 CY17 CY18 CY19 CY20 CY21 ‘It’s Energy and Minerals, Not Only Steel’ 31
Slide 32: Education: Enabling quality education in community
Education: Enabling quality education in community ▪ Salary support to Teachers at Siltara & Mines area village schools ▪ Support for the School bus at Raigarh ▪ Financial support for higher education for 42 students ▪ Additional school room construction in Murethi ▪ Distribution of computers to sch
Slide 33: Healthcare: Preventive & curative healthcare services
Healthcare : Preventive & curative healthcare services ▪ Support to Udyanchal Trust for Community Healthcare Service ▪ Operating mobile medical van with free medicines ▪ Doctors for community healthcare services ▪ Financial support to critical patients for their treatment ▪ Support for creation of M
Slide 34: Infrastructure: Creating community assets
Infrastructure : Creating community assets ▪ Deepening of pond in Jakke village ▪ Construction of Boundary wall in Kalar Samaj Bhavan, before Mandhar ▪ Lane Concrete work in Dondekhurd & Girod ▪ Road Repair work at Karwahi ▪ Road repair work from Gare to Khamaria ▪ Construction of Sant Kabir Swagat
Slide 35: Livelihood: Environmental & economical sustainability
Livelihood : Environmental & economical sustainability ▪ Mass plantation under Maha Vrikshropan Abhiyan & Krishna kunj Yojna ▪ Pond Deepening work at Jakke village for Water shed development ▪ Potable water supply in Siltara, Mandhar & Mines area villages ▪ Crop loss support to farmers of Tada villa
Slide 36: Art, Culture & Sports: Sports & culture development
Art, Culture & Sports : Sports & culture development ▪ Making of CSR Film on development issues ▪ Training with CBWE on Women Empowerment ▪ Support to old aged Smt. Radha Bai Mandavi ▪ Support for the local cultural program Jhanki, Madai etc. ▪ Support to Maheshwari trust on Development issues ▪ Sup
Slide 37: Financials
Financials 37
Slide 38: Strong Balance Sheet: Comfortable Leverage Position
Strong Balance Sheet: Comfortable Leverage Position Figures in INR Crore 3,161 3,004 2,218 2,199 2,190 • Improving TOL/ NW ratio along 2,132 2,081 with strong liquidity position 1,870 1,807 1,743 • With additional cashflows post commissioning of Sikkim Hydro 1.14 1.04 project and operationalization
Slide 39: Consolidated P&L – Consistent Growth and High Profit Margins
Consolidated P&L – Consistent Growth and High Profit Margins INR in Cr FY19 FY20 FY21 FY22 H1FY23 Revenues 2,324 2,000 2,199 3,914 2,228 Other Income 17 -17 144 50 -18 Total Income 2,341 1,983 2,343 3,964 2,210 Raw Material 1,493 1,293 1,347 2,086 1,236 Employee Expenses 87 88 89 113 65 Other Operat
Slide 40: Consolidated BS – Conservative Capital Structure and Strong Liquidity
Consolidated BS – Conservative Capital Structure and Strong Liquidity Profile INR in Cr Mar-19 Mar-20 Mar-21 Mar-22 Sep-22 Share Capital 36 36 36 36 35 Tangible Networth 1,707 1,834 2,182 2,968 3,126 Minority Interest 132 100 101 104 107 Long Term Borrowings 1,078 1,408 1,493 1,196 1,111 Short Term
Slide 41: Yearly Trend | Production and Sales (1/2)
Yearly Trend | Production and Sales (1/2) Iron Ore Pellets Sponge Iron Steel Billet PRODUCTION ('000 MT) PRODUCTION ('000 MT) PRODUCTION ('000 MT) 741 600 600 619 302 325 291 294 177 192 175 400 157 128 102 FY19 FY20 FY21 FY22 H1FY23 FY19 FY20 FY21 FY22 H1FY23 FY19 FY20 FY21 FY22 H1FY23 SALES ('000
Slide 42: Yearly Trend | Production and Sales (2/2)
Yearly Trend | Production and Sales (2/2) Wire Rod H. B. Wires Ferro Alloys PRODUCTION ('000 MT) PRODUCTION ('000 MT) PRODUCTION ('000 MT) 161 32 142 147 26 145 159 119 21 23 124 132 19 86 68 FY19 FY20 FY21 FY22 H1FY23 FY19 FY20 FY21 FY22 H1FY23 FY19 FY20 FY21 FY22 H1FY23 SALES ('000 MT) SALES ('000
Slide 43: Power Segment: Generation & Sales (volumes)
Power Segment: Generation & Sales (volumes) Thermal Power + Waste Heat = Capacity of ~162 MW Hydro Power – Capacity of ~143 MW (Figures in Mn KwH) (Figures in Mn KwH) 1,076 1,079 417 417 999 964 368 368 485 115 115 129 129 173 85 85 142 103 76 45 FY19 FY20 FY21 FY22 H1FY23 FY19 FY20 FY21 FY22* H1FY2
Slide 44: Share Price Information
Share Price Information Volume (# Shares) Share Price (INR) 1400 800000 1200 700000 1000 600000 500000 800 400000 600 300000 400 200000 200 100000 0 0 Capital Market Information (as on 11-Nov-22) Shareholding Pattern (as on 30-September-22) BSE/NSE Code 504614/SARDAEN Non institutions CMP (Rs) 871 2
Slide 45: THANK YOU
THANK YOU Mr. Nilay Joshi (Head – Corporate Finance) Ms. Pooja Sharma / Ms. Vinita Pandya njoshi@seml.co.in pooja.sharma@stellar-ir.com / vinita@stellar-ir.com 125 B-Wing Mittal Court, Nariman Point, Mumbai 400 021 Kanakia Wall Street, Andheri (East), Mumbai 400 093 www.seml.co.in ‘It’s Energy and M
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