Greenlam Industries Ltd · NSE:GREENLAM
Greenlam Industries — H1 FY2019 Earnings Presentation
78 slides from Greenlam Industries's earnings presentation, November 2018
Slide 1: Investor Presentation Q2 & H1 FY2019
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED Investor Presentation Q2 & H1 FY2019 November, 2018
Slide 2: Safe Harbour
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED Safe Harbour This presentation and the accompanying slides (the “Presentation”), which have been prepared by Greenlam Industries Limited (the “Company”), have been prepared solely for information purposes and do not constitute any offer, recommen
Slide 3: Some people look for beautiful space, others make a place beautiful
“Some people look for beautiful Space, PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED otherS make a place beautiful” We at Greenlam, transform and beautify spaces with evolving technologies and creative design solutions. A one stop solution for all surfacing needs. Laminate | Compact Laminate
Slide 4: 25 Years of Excellence
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED 25 Years of Excellence 1992 foundation of laminate unit at Behror, Rajasthan 1993 initiated commercial production and exports of laminates 2002 started commercial production of decorative veneer 2006 established1st overseas subsidiary in Singapor
Slide 5: 25 Years of Excellence
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED 25 Years of Excellence 2014 commercial production of Engineered Wooden Flooring and Melamine Faced Chipboards started at Behror 2015 commercial production of Engineered Doors at Behror 2015 launched Teak & Engineered Veneer in Decorative Veneer s
Slide 6: Greenlam Today
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED LARGE PORTFOLIO GREENLAM CUSTOMER CENTRIC APPROACH SURFACE DÉCOR PRODUCTS TODAY PASSIONATE FOR TRUSTED FOR • Among World’s Top 3 Laminate producers • Asia’s Largest Laminate brand INNOVATION & GREENLAM TRANSFORMING SPACE • India’s Largest Exporte
Slide 7: Performance Parameters
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED Performance Parameters Net Revenue (INR Crores ) EBITDA (INR Crores) +7.3% +16.6% 1,076 1,145 138 149 1,030 129 926 94 12.6% 12.9% 13.0% 10.2% Margin FY15 FY16 FY17 FY18 FY15 FY16 FY17 FY18 PAT (INR Crores) Cash PAT (INR Crores) 65 +22.1% 93 +49.
Slide 8: Debt & Operating Parameters
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED Debt & Operating Parameters Return on Capital Employed Debt-Equity Ratio 18.3% 1.79 16.8% 14.8% 1.49 1.00 9.4% 0.71 FY15 FY16 FY17 FY18 FY15 FY16 FY17 FY18 Return On Equity Working Capital Days 18.1% -4 15.4% 16.7% 90 87 86 86 8.8% FY15 FY16 FY17
Slide 9: Our Customers
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED Our Customers Corporate Education & Health Retail & Real Estate Hospitality 9
Slide 10: Industry Snapshot
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED Industry Snapshot
Slide 11: Industry Snapshot
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED Industry Snapshot Laminates & Allied Products – India & Export From India Market Size – 5125 Cr India Market Export from India 4000 Cr 1125 Cr Domestic Industry Export From India 4000 Cr 1125 Cr 2700 Cr 1300 Cr 13% Market share ~33% Market share
Slide 12: Industry Snapshot: Laminates & Allied Products – India
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED Industry Snapshot Laminates & Allied Products – India • The laminate and allied business accounts for 86% of Greenlam’s business • The Indian laminate industry grew by 4-5% • The organized sector controls around 68% of the laminate market, with t
Slide 13: Industry Snapshot: International Laminate Market
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED Industry Snapshot Laminates & Allied Products – International Market Americas Greenlam International Revenue (Con) H1 FY19 • Market Size – USD 7.2 Billion 19% APAC, Europe • Global Laminate market is growing by 2-3% 32% 14% • Exports from India i
Slide 14: Industry Snapshot: Decorative Veneer and Allied Products
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED Industry Snapshot Decorative Veneer and Allied Products Total Veneer Market Size ~11% Market share in 1050 Cr 950 Cr organised market Decowood 118 Cr 2000 Cr Natural Veneer Market Size Teak Veneer Market Size Engineered Veneer Market Size 550 Cr
Slide 15: Industry Snapshot: Engineered Wood Floorings
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED Industry Snapshot Engineered Wood Floorings – India & Global • India Market is estimated at 2 msqm • Category is witnessing a 7-8% growth • Majority demand met through import • India’s only domestic manufacturer • Manufacturing capacity – 1 msqm
Slide 16: Industry Snapshot: Engineered Door & Door Sets
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED Industry Snapshot Engineered Door & Door Sets • Door (including flush door) market is estimated at 24mn units annually • Engineered Finished Door category is witnessing a 10- 15% growth • First organised players providing complete solution • Spec
Slide 17: Economic Outlook
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED Economic Outlook
Slide 18: Indian Economy
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED Indian Economy • The overall annual GDP growth stood at 6.7% for FY 2017-18, lower than 7.1% for FY 2016-17 • India at present is 6th largest economy in terms of GDP • Consumer spending in India is expected to more than double by 2025 • Growth in
Slide 19: Domestic Growth Triggers
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED Domestic Growth Triggers Government Policy Initiatives • RERA, a much needed initiative to regulate real estate sector • Swatch Bharat Abhiyan • Smart Cities Mission, over 100 cities being developed under this initiative • 1.4 mn houses sanctione
Slide 20: Domestic Growth Triggers
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED Domestic Growth Triggers Indian Real Estate Sector • Sector is expected to clock USD 180 Bn. by 2020 • Cross-border capital inflows to India’s real estate sector have increased 600 per cent between 2012-17 to reach USD 2.6 billion • India ranked
Slide 21: Domestic Growth Triggers
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED Domestic Growth Triggers Demand for Modern Homes • 10 mn Urban Housing shortage • Increased consciousness for stylish interiors and aesthetic indoors • Change in people’s perception leading to an increase in spending on Furniture, Fixtures & on H
Slide 22: Global Economy
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED Global Economy Global growth is pegged at 3.5% in 2017 & 3.6% in 2018, as per IMF Cyclical recovery in investment, manufacturing, and trade leading to pick up in Global economic activity Low Inflation in advanced economies is likely to move up as
Slide 23: Global Growth Triggers
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED Global Growth Triggers • Developed economies are witnessing a growth cycle • USA, worlds largest economy, entered in ninth straight year of growth in 2017 • Local manufacturing is increasingly becoming unviable in some countries due to higher man
Slide 24: Leveraging Growth Opportunities
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED Leveraging Growth Opportunities
Slide 25: Product Portfolio
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED Product Portfolio
Slide 26: Product Portfolio
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED Product Portfolio Decorative Laminate & Allied products Veneer & Allied Decorative Laminates Compact Panel MFC Mikasa Floor Mikasa Door Veneer Standard Compact Panel Natural Veneer Lab Guardian Engineered Door Commodity to Melamine Faced Teak Ven
Slide 27: Laminate Category
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED Laminate Category ▪ Laminate category has witnessed an immense change in terms of design evolution and product performance ▪ It graduated from a commodity product to be a lifestyle and low maintenance surfacing option ▪ Greenlam offers variety of
Slide 28: Laminate Applications
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED Laminate Applications 28
Slide 29: Compact Category
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED Compact Category ▪ Compact laminate panel is gaining momentum and acceptance in India ▪ With the growth of organized carpentry in the country, customers are seeking high performance and durable product solutions ▪ Compact panels are now used for
Slide 30: Compact Applications
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED Compact Applications 30
Slide 31: MFC Category
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED MFC Category ▪ With the increase in organized carpentry (OEM) in the country, the usage of engineered wood like MFC is gaining pace in kitchen & modular furniture segment ▪ MFC compliments laminate sales to OEM segment with matching decors ▪ Gree
Slide 32: MFC Applications
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED MFC Applications 32
Slide 33: Decorative Veneers
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED Decorative Veneers • Decorative Veneer segment has seen various changes with the implementation of GST which has resulted in narrowing the price gap • Overall the industry is transforming towards more organized sector • The specification industry
Slide 34: Decorative Veneer Applications
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED Decorative Veneer Applications 34
Slide 35: Engineered Wood Flooring Category
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED Engineered Wood Flooring Category • Indian wooden flooring market is still at nascent stage • Acceptability of wooden flooring is increasing in residential segment but due to lack of category awareness, the wooden flooring segment is dominated by
Slide 36: Engineered Wood Flooring Applications
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED Engineered Wood Flooring Applications 36
Slide 37: Engineered Door & Door sets
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED Engineered Door & Door sets • An industry set for transformation from traditional carpentry to factory finished door solutions owing to super finish and product performance • A great forward integration solution backed by the manufacturing capabi
Slide 38: Engineered Door Applications
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED Engineered Door Applications 38
Slide 39: Manufacturing
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED Manufacturing
Slide 40: Manufacturing Capabilities
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED Manufacturing Capabilities Behror, Rajasthan Products Laminates and compact 5.34 mn sheets laminates Decorative veneers 4.20 mn sq. m Melamine-faced chipboard 2.00 mn sq. m Engineered wood flooring 1.00 mn sq. m Nalagarh, Himachal Pradesh Enginee
Slide 41: Sufficient leverage available without significant capex
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED Sufficient leverage available without significant capex FY18 Revenue: Rs. 984 crs Laminates Capacity: 14 mn sheets Utilisation: 101% FY18 Revenue: Rs. 118 crs Decorative Veneer Capacity: 4.2 mn sq mtrs Utilisation: 37% Yet to Unlock our true pote
Slide 42: Distribution Network
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED Distribution Network
Slide 43: Domestic distribution network
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED Domestic 12 Company owned large Regional 2 State of the art Distribution Centres Manufacturing Facilities 14,000+ Distributors, Dealers & Retailers – Manufacturing Base Branch Offices Over 500+ Sales 22 Branch / Sales Regional Distribution Centre
Slide 44: Global Footprints
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED Global Footprints Present in 100+ Countries 2 Company Operated Distribution Centre 13 International Offices 4 Overseas 90+ Overseas Employees Subsidiaries 44
Slide 45: 'People & Planet Positive' Certifications
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED ‘People & Planet Positive’ Certifications
Slide 46: PROFITING FROM DISCIPLINE
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED 46
Slide 47: Brand & Marketing
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED Brand & Marketing
Slide 48: Target Audience
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED 360 Degree Marketing EVENTS & ACTIVATIONS PRINT Target Audience • Specifier • Influencer PR GREENLAM DIGITAL • Consumer – Commercial, Residential EXHIBITION BRAND STORES 48
Slide 49: Print Campaigns
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED Print Campaigns 49
Slide 50: Learning & Engagement
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED Learning & Engagement 50
Slide 51: Training Programs
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED Training Programs 51
Slide 52: Brand Stores & SIS
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED Brand Stores & SIS 52
Slide 53: Digital
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED Fans: 439,708 Followers: 2761 Followers: 1056 Fans: 109,151 Followers: 43 Followers: 201 Digital Fans: 59053 Followers: 42 Followers: 4415 53
Slide 54: CSR Initiatives
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED CSR Initiatives
Slide 55: CSR programs at various locations
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED Current Programs at various location BEHROR | NALAGARH | GHAZIABAD | PALI NAGAR Initiatives Touching Lives of • Awareness on Reproductive, Maternal, New born, Child and Adolescent’s Heath and creating linkages to public health services to communi
Slide 56: Glimpses from Initiatives at Nalagarh
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED Glimpses from Initiatives at - Nalagarh Inauguration of CRC and BaLA in Sobhan Majjra Celebration of Independence Day Students participating in poster Remedial Classes Sports Meet in Panjhera making contest 56
Slide 57: Glimpses from Initiatives at Behror
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED Glimpses from Initiatives at - Behror Mothers Group formation at Gandala Village Community Meeting at Sherpur Village 57
Slide 58: Glimpses from Initiatives at Pali / Nagaur
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED Glimpses from Initiatives at - Pali / Nagaur Adolescents meetings EDP training follow up Learning and Sharing Event NGO Meeting Event 58
Slide 59: Glimpses from Initiatives at Ghaziabad
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED Glimpses from Initiatives at - Ghaziabad Birthday Celebration in Ghar Group Counselling for the children Volunteer Visit in Ghar Dance Performance by children of Ghar Exposure visit to slums 59
Slide 60: Outlook
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED Outlook
Slide 61: Laminate & Allied
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED Laminate & Allied • Capitalize on the shrinking market share of the unorganized sector for profitable growth • Further consolidate Branches and Regional Distribution Centers to create an efficient distribution chain • Sustain growth in interior a
Slide 62: Decorative Veneer
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED Decorative Veneer • Focus on increasing dealer network to achieve higher penetration • Promote mid-range products as viable alternatives • Focus on gaining market share from the local unorganized players • Continue offering customized solutions f
Slide 63: Engineered Wood Flooring
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED Engineered Wood Flooring • Continue expansion of our dealer network • Engage with various designers and architects to promote Mikasa flooring • Expand product portfolio with mid and high range products • Greenlam shaping up as the first exporter
Slide 64: Engineered Door Segment
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED Engineered Door Segment • Looking at export opportunities in Middle East & Europe • Investments planned to deploy automation at the plant • Automation focus will improve specifications and cost competitiveness • Targeting a robust revenue growth
Slide 65: Unaudited Consolidated Financials
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED Unaudited Consolidated Financials
Slide 66: Consolidated Financial Performance – Q2FY19
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED Consolidated Financial Performance – Q2FY19 • Consolidated Net Revenue stood at INR 318 Crores as compared to INR 276 Crores, growth of 15.6%, ➢ Laminate revenue grew 13.4% from INR 240.3 crores in Q2FY18 to INR 272.5 crores in Q2FY19 ▪ Domestic
Slide 67: Consolidated Financial Performance – H1FY19
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED Consolidated Financial Performance – H1FY19 • Consolidated Net Revenue stood at INR 607 Crores as compared to INR 553 Crores, growth of 9.6%, ➢ Laminate revenue from by 7.5% from INR 483.2 crores in H1FY18 to INR 519.6 crores in H1FY19 ▪ Domestic
Slide 68: Consolidated Financial Performance: Profit and Loss Statement
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED Consolidated Financial Performance Profit and Loss Statement INR Crores Q2FY19 Q2FY18 YoY% H1FY19 H1FY18 YoY% Net Revenue 318.4 275.6 15.6% 606.5 553.3 9.6% Raw Material 172.3 141.6 322.7 285.9 Gross Profit 146.1 133.9 9.1% 283.8 267.5 6.1% Gross
Slide 69: Consolidated Financial Performance: Balance Sheet
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED Consolidated Financial Performance Balance Sheet INR Crores Sept-18 Mar-18 INR Crores Sept-18 Mar-18 Shareholder’s Fund 386.5 356.1 Non-Current Assets 361.1 352.9 Share capital 12.1 12.1 Fixed assets 336.1 329.8 Reserves & Surplus 374.4 344.1 Goo
Slide 70: Laminates & Allied Segment
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED Consolidated Financial Performance Laminates & Allied Segment INR Crores Q2FY19 Q2FY18 YoY% H1FY19 H1FY18 YoY% Net Revenue 272.5 240.3 13.4% 519.6 483.2 7.5% Gross Profit 125.8 115.5 8.9% 244.5 230.2 6.2% Gross Margin % 46.2% 48.1% -190 bps 47.0%
Slide 71: Laminates & Allied Segment: Production and Sales
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED Consolidated Financial Performance Laminates & Allied Segment Production and Capacity (Mn Sheets) Sales (Mn Sheets) Average Realisation (INR / Sheet) -6.2% -5.7% +16.8% 3.51 3.53 3.51 3.31 3.55 3.35 778 667 Q2FY18 Q2FY19 Q2FY18 Q2FY19 Q2FY18 Q2FY
Slide 72: Veneers & Allied Segment
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED Consolidated Financial Performance Veneers & Allied Segment INR Crores Q2FY19 Q2FY18 YoY% H1FY19 H1FY18 YoY% Net Revenue 45.9 35.3 30.3% 86.9 70.1 24.0% Gross Profit 20.4 18.4 10.7% 39.4 37.3 5.6% Gross Margin % 44.3% 52.1% -780 bps 45.3% 53.1% -
Slide 73: Decorative Veneers: Production and Sales
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED Consolidated Financial Performance Decorative Veneers Production and Capacity Sales Average Realisation (Mn Sqmt) (Mn Sqmt) (INR / Sqmt) +6.8% +4.8% +3.2% 1.05 1.05 0.41 0.43 691 713 0.39 0.41 Q2FY18 Q2FY19 Q2FY18 Q2FY19 Q2FY18 Q2FY19 Capacity Pr
Slide 74: Engineered Doors and Floors
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED Consolidated Financial Performance Engineered Doors and Floors Revenue (INR Crores) EBIDTA (INR Crores) Capacity Utilization 12.6 24% -0.5 5.1 -1.2 -1.3 9% 10% 9% 2.2 3.0 -1.8 Q2FY18 Q2FY19 Q2FY18 Q2FY19 Q2FY18 Q2FY19 Floors Doors Floors Doors Fl
Slide 75: Operating Parameters – Net Working Capital (Days)
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED Consolidated Financial Performance Operating Parameters- Net Working Capital (Days) Net Working Capital Days In Days Q2FY18 Q2FY19 H1FY18 H1FY19 -11 90 79 Inventory 87 89 87 94 Debtors 53 46 53 48 Q2FY18 Q2FY19 -7 90 Creditors 50 56 50 59 83 Net
Slide 76: Return Ratios – ROCE & ROE
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED Consolidated Financial Performance Return Ratios – ROCE & ROE ROCE INR Crores H1FY18 H1FY19 FY17 FY18 17.0% 16.5% 16.8% 18.3% EBIT 54.0 55.2 104.2 114.6 PAT 29.4 33.5 49.7 64.6 *H1FY18 *H1FY19 FY17 FY18 Capital Employed 634.5 668.7 618.5 627.4 RO
Slide 77: Debt Position
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED Consolidated Financial Performance Debt Position Debt-Equity Ratio INR Crores H1FY18 H1FY19 FY17 FY18 0.92 1.00 0.68 0.71 Long Term Debt 139.8 99.0 137.5 122.1 (Including current portion) Short Term Debt 155.9 164.7 161.0 129.6 *H1FY18 *H1FY19 FY
Slide 78: For further information, please contact
PROFITING FROM DISCIPLINE GREENLAM INDUSTRIES LIMITED For further information, please contact: Company : Investor Relations Advisors : Greenlam Industries Ltd. Strategic Growth Advisors Pvt. Ltd. CIN: L21016AS2013PLC011624 CIN: U74140MH2010PTC204285 Mr. Ashok Sharma - CFO Mr. Shogun Jain / Mr. Shrik
Greenlam Industries — H1 FY2019 Earnings Presentation on 6ix