Himadri Speciality Chemical Ltd. · NSE:HSCL
Himadri Speciality Chemical — Q3 FY2018 Earnings Presentation
45 slides from Himadri Speciality Chemical's earnings presentation, Jan 29, 2018
Slide 1: Investor Presentation January 2018
(Formerly known as Himadri Chemicals & Industries Ltd.) INVESTOR PRESENTATION January - 2018
Slide 2: Safe Harbor
Safe Harbor This presentation and the accompanying slides (the “Presentation”), which have been prepared by Himadri Speciality Chemical Ltd (the “Company”), have been prepared solely for information purposes and do not constitute any offer, recommendation or invitation to purchase or subscribe for a
Slide 3: Capacity Expansion in High Margin Products
Capacity Expansion in High Margin Products Advance Carbon Material » Set-up of manufacturing facility of Advance Carbon material (HSCP) at West Bengal with Project Cost annual capacity of 20,000 MT » Total Project cost for the combined capacity of Advance Carbon Material (HSCP) and Carbon Carbon Bla
Slide 4: Key Financial Highlights
Key Financial Highlights 9MFY18 vs. 9MFY17 Y-o-Y Growth 85% 74% 237% EBITDA EBITDA / MT PAT 3MFY18 vs. 3MFY17 78% 84% 249% EBITDA EBITDA / MT PAT 4
Slide 5: Improving EBITDA/MT with Sustainable Volumes
Improving EBITDA/MT with Sustainable Volumes EBITDA/MT (In Rs.) Volumes (MT) Improving Sequentially Sustainable Volumes +22.1% 96,337 94,769 94,220 12,930 92,231 93,186 10,592 10,896 7,854 7,023 Q3FY17 Q4FY17 Q1FY18 Q2FY18 Q3FY18 Q3FY17 Q4FY17 Q1FY18 Q2FY18 Q3FY18 5
Slide 6: Standalone Profit & Loss
Standalone Profit & Loss Particulars (In Rs. Crs) Q3 FY18 Q3 FY17 Y-o-Y (%) 9M FY18 9M FY17 Y-o-Y (%) Revenue from Operations 500.1 391.3 1,470.8 1,056.0 Excise Duty - 39.5 50.4 107.4 Net Revenue From Operations 500.1 351.8 42.2% 1,420.4 948.6 49.7% Cost of materials consumed 327.1 234.7 962.8 634.6
Slide 7: Debt Profile
Debt Profile In Rs. Crores Long Term Debt Working Capital Debt Net Debt -2 -52 -48 414 426 424 786 401 353 340 734 717 827 777 754 -37 -42 -43 31-Mar-17 30-Sep-17 31-Dec-17 31-Mar-17 30-Sep-17 31-Dec-17 31-Mar-17 30-Sep-17 31-Dec-17 7
Slide 8: Standalone Balance Sheet
Standalone Balance Sheet Particulars (in Rs. Crs.) Sep'17 Mar'17 Particulars (in Rs. Crs.) Sep'17 Mar'17 ASSETS EQUITY AND LIABILITIES Non-current assets 1,651.5 1,421.8 EQUITY 1,304.9 1,078.1 Property, Plant and Equipment 1,091.3 1,103.00 Equity Share capital 41.8 41.8 Capital work-in-progress 22.9
Slide 9: Himadri
_-- Himaadri
Slide 10: Agenda
Fit for Future: Products & Value Creation Journey its Potential Looking back at Three by way of ▪ Accelerating Core Business Decades of Experience Vertical Integration ▪ Finding next Core Business Looking Forward with Financial Agenda Confidence
Slide 11: Leadership Position in our Products
Leadership Position in our Products Coal Tar Pitch Carbon Black 70% 17% Market Leadership as % of Total 85% Domestic Demand including Imports Source: Management Estimates (India Market Share) 11
Slide 12: Product Development was a Clear Focus
Product Development was a Clear Focus 2010 2017 Coal tar pitch – Binder grade Aluminium Grade Pitch Anthracene Oil/Carbon Coal tar pitch – Impregnating Graphite Grade Binder Pitch Black Oil/ CT Oil Carbon Black Graphite Grade Zero QI SNF Advanced Carbon Material (Quinolene Insoluble) coal tar PCE im
Slide 13: To make an Impact on the End Markets
To make an Impact on the End Markets Graphite Lithium – Ion Aluminium Missiles Electrodes Batteries Anti Corrosive Paints, Plastic & Rubber Industries Power Material Fibre Construction Wood Preservative Specialized Infrastructure Chemical Oils Products 13
Slide 14: If You Can Be One Thing, Be Dependable
If You Can Be One Thing, Be Dependable CTP Clientele CB Clientele Others Clientele 14
Slide 15: Rapid growth through R&D
Rapid growth through R&D » R&D Centre recognised by the Department of Science and Technology and the Department of Scientific and Industrial Research - Government of India » R&D Centre is an NABL (National Accreditation Board for Testing and Calibration Laboratories) - accredited lab » Research acti
Slide 16: Agenda
Fit for Future: Products & Value Creation Journey its Potential Looking back at Three by way of ▪ Accelerating Core Business Decades of Experience Vertical Integration ▪ Finding next Core Business Looking Forward with Financial Agenda Confidence
Slide 17: Product Leadership – Accelerating Core Business
» Product Leadership – Accelerating Core Business ▪ Coal Tar Pitch ▪ Carbon Black ▪ Naphthalene ▪ Sulphonated Naphthalene Formaldehyde (SNF) 17
Slide 18: Coal Tar Pitch
Coal Tar Pitch Caters to more than Two-Third of demand for Indian Graphite and Aluminium Industries Supplier of upto 95% of Coal Tar Pitch requirements of certain Smelters One amongst the Few Global Manufacturers to Produce Zero QI (Quinolene Insoluble) – coal tar impregnated pitch and Advanced Carb
Slide 19: Graphite Grade Coal Tar Pitch
Critical Input in Downstream Industries Coal Tar Pitch Graphite Grade In Graphite Electrode Binder Pitch Manufacturing Graphite Grade Zero QI Coal tar Anode Impregnating Pitch Special Pitches Material In graphite electrode, nipple Used by DRDO in long range warhead missiles. In carbon composites, re
Slide 20: Inelastic & Growing Demand
Inelastic & Growing Demand » Inelastic Demand : Coal Tar Pitch is used in pre-baked anode in aluminium smelter to produce aluminium. Aluminium Smelting is a Continuous Process - Smelter cannot be stopped and restarted easily » Complex Chemical : Coal Tar Pitch is a Complex chemical with 22 Chemical
Slide 21: Capacity Built Up to Support Growth
Capacity Built Up to Support Growth Distillation Capacity Built Up in India » Raw Material Procurement: in MTPA 400,000 ▪ Largest Purchaser of Coal Tar in India from almost all domestic steel plants 137,500 ▪ Strategically imports Coal Tar based on prevailing global demand supply dynamics 12,500 74,
Slide 22: Carbon Black
Carbon Black Forward Integration to convert Coal Tar Oil into Carbon Black 3rd Largest Carbon Black Producer in India with Anything that is 120,000 MTPA manufactured Black has With Superior Inhouse Raw Carbon Black Material & R&D Capabilities launching Speciality Carbon Black range with niche applic
Slide 23: Benefits of Forward Integration
Benefits of Forward Integration Raw Material Leverage R&D Access to superior, consistent & Leveraged R&D strength to develop a customized Raw Material feed from range of speciality carbon black inhouse distillation units Raw products Material Leverage Leverage R&D R&D Power Generation Power Tail gas
Slide 24: Large Market Potential
Large Market Potential Indian Tyre - Commissioned Projects Speciality Carbon Black Rs. Crore in MTPA 915,000 21,000 17,000 49,000 India demand Global demand FY14 - 17 FY18 - 22E 2016 2016 Indian Tyre Market is ~ Rs. 500 Bn in FY16 Speciality black market in India is currently small at less than 5% o
Slide 25: Naphthalene
Naphthalene Value-additions through Capacity Refined Doubled for Naphthalene and refined Naphthalene SNF Also formulate Special Grade Naphthalene 25
Slide 26: Naphthalene Value Proposition
Naphthalene Value Proposition Special Grade Naphthalene Special Grade Naphthalene is formulated to cater customer's niche requirements in dyestuff and dyes intermediates application Naphthalene Moth Ball Moth Balls is made by using superior grade chemical composition and leading-edge techniques in c
Slide 27: Sulphonated Naphthalene Formaldehyde (SNF)
Sulphonated Naphthalene Formaldehyde (SNF) SNF – Next Generation Product for the Construction Chemical Industry (Admixture), Agro chemicals, Latex, Gypsum Largest Indian manufacturer of SNF with an installed capacity of 68,000 MTPA Highest Purity SNF manufactured from In-house produced Naphthalene P
Slide 28: High Performance Construction Chemicals
High Performance Construction Chemicals » Sulphonated Naphthalene Formaldehyde (SNF) is a speciality chemical condensate that helps improve concrete mixes by dispersing cement particles for extended workability and reinforcing compressive flexural strength ▪ Naphthalene, one of the by product of Coa
Slide 29: Future Products – Finding Next Core Business
»Future Products – Finding Next Core Business ▪ Advance Carbon Material 29
Slide 30: Advance Carbon Material
Advance Carbon Material Forward Integration from Coal Tar to Advance Carbon Material Anode Material used in Lithium-ion Batteries Only Producer of Advance Carbon Material in India Best in class Proprietary Technology With Cost Leadership 30
Slide 31: Application in Sunrise Sector
Application in Sunrise Sector Lithium-ion Battery Mobile Tablets Electric Vehicle Motor Train Others Digital Power Tool Laptop Energy Storage Cameras 31
Slide 32: At early stage of Growth
At early stage of Growth Global Shipments of Lithium-ion » First Indian Company to develop anode material of both Battery Anode Materials In Kt Synthetic and Natural varieties for lithium-ion batteries 369 ▪ Best-in-class Proprietary technology which involves Coal Tar 292 +26% treatment into Advance
Slide 33: Agenda
Fit for Future: Products & Value Creation Journey its Potential Looking back at Three by way of ▪ Accelerating Core Business Decades of Experience Vertical Integration ▪ Finding next Core Business Looking Forward with Financial Agenda Confidence
Slide 34: Evolving…
Evolving… 2016 - 2017 • Transformed identity to 2008-2012 2013 - 2015 Himadri Speciality Chemical • Acquisition and Expansion of Limited SNF plant in Vapi and • Initiated a Brownfield • Commenced pitch melting Commission production of SNF project to enhance the CTD plant at Sambalpur, Odisha at Mahi
Slide 35: Presence at Strategic Locations in India
…with Presence at Strategic Locations in India… Product Capacity Plant Existing Capacity Coal Tar Distillation Capacity 400,000 Carbon Black – MTPA 120,000 Howrah Korba* Power Plant (Co. generation) – MW 20 Vapi Falta Hooghly Sambalpur* SNF - MTPA 68,000 Visakhapatnam All our facilities are Zero-Dis
Slide 36: Key Elements in Business Model
…supported by Key Elements in Business Model… R&D Centre at Mahistikry unit (Hooghly) - recognized by GoI* R&D Technical Know- Cutting-edge research and best-in-class technical capabilities how & Manpower Dedicated fleet of specially-designed 148 Tankers Storage & Raw material storage capacity of ar
Slide 37: Awards & Recognition
…with validation through Awards & Recognition 2013 ‘Best Large Corporate’ of WB in INR 1,000+ Cr Category 2014 ‘Highest Job Creator’ of WB in INR 1,000+ Cr Category 37
Slide 38: Value Creation Journey by way of Vertical Integration
Fit for Future: Products & Value Creation Journey its Potential Looking back at Three by way of ▪ Accelerating Core Business Decades of Experience Vertical Integration ▪ Finding next Core Business Looking Forward with Financial Agenda Confidence
Slide 39: Key Performance Indicator
Key Performance Indicator Total Sales Volume (MT) 356,902 299,137 272,771 263,151 259,968 FY13 FY14 FY15 FY16 FY17 39
Slide 40: Change in the Debt Composition
Change in the Debt Composition Total Debt Profile FY12 Total Debt Profile FY17 Rupee Debt 9.5% Rupee Debt 69.4% Dollar Debt 30.6% Dollar Debt 90.5% Change in Debt Composition from ~91% of Foreign Currency Loans to ~31% in FY17 40
Slide 41: Debt Repayment of over Rs. 500 Crores
Debt Repayment of over Rs. 500 Crores Rs. Crores Rupee Debt Dollar Debt $ million Net Debt Rs. Crores -66.3% 523 101 -35.8% 1,118 598 47 71 1,030 503 498 32 47 34 476 24 523 392 54 7 805 39 327 24 27 717 598 371 FY14 FY15 FY16 FY17 Rs. Crores 503 -63.1% 498 255 265 238 595 164 270 432 595 -59 -63 -3
Slide 42: Value Creation Journey by way of Vertical Integration
Fit for Future: Products & Value Creation Journey its Potential Looking back at Three by way of ▪ Accelerating Core Business Decades of Experience Vertical Integration ▪ Finding next Core Business Looking Forward with Financial Agenda Confidence
Slide 43: Strongly positioned to capture Growing Markets
Strongly positioned to capture Growing Markets Global Management Team Right Capacity Strategic Location High Value Product Product Cutting Edge Pipeline Leadership Technologies Strong Growing End Clientele Markets Strong R&D 43
Slide 44: Strategic Growth Priorities
Strategic Growth Priorities Carbon Black SNF Increase application of Increase in demand in Focus on Speciality Carbon lithium-ion batteries in the Widen the Product downstream industries with High Value-additions & Sunrise Sectors like Portfolio by Aluminium & Graphite Performance Electric Vehicles,
Slide 45: For further information, please contact
For further information, please contact: Company : Investor Relations Advisors : CIN: L27106WB1987PLC042756 CIN: U74140MH2010PTC204285 Mr. Somesh Satnalika Ms. Payal Dave / Mr. Pankaj Chhaochharia VP Strategy & Business Development +91 9819916314/ +91 7977090417 Email: ssatnalika@himadri.com Email:
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