Jindal Stainless Limited · NSE:JSL
Jindal Stainless — Q4 FY2019 Earnings Presentation
54 slides from Jindal Stainless's earnings presentation, May 28, 2019
Slide 1: Exchange filing cover letter
May 28,2019 BSE Limited National Stock Exchange of India Ltd . I st Floor, New Trading Ring, Exchange Plaza, 5th Floor, Rotunda Building, P J Towers, Plot no. Cll, G Block Dalal Street, Fort, Mumbai - 400 001 Bandra-Kurla Complex, Bandra(E), # 022 - 22 72 3 12 I, 203 7, 2041, Mumbai-400051 3719,2039
Slide 2: Q4 & FY19 Earnings Presentation
Q4 & FY19 Earnings Presentation – May 20, 2019 JINDAL STAINLESS LIMITED
Slide 3: Disclaimer
Disclaimer 2 This presentation and the accompanying slides (the “Presentation”), which has been prepared by Jindal Stainless Limited (the "Company"), has been prepared purely for information purposes only and is not, and is not intended to be, an offer, or solicitation of offer, or invitation or rec
Slide 4: Q4 & FY19 Results Overview
Q4 & FY19 i 4 =r Results Overview | j | er es
Slide 5: Key Financials Highlights – Q4 & FY19
Key Financials Highlights – Q4 & FY19 4 Net Revenue from operations EBITDA 12,585 1,281 10,785 1,136 3,173 3,128 3,251 388 302 228 Q4 FY18 Q3 FY19 Q4 FY19 FY18 FY19 Q4 FY18 Q3 FY19 Q4 FY19 FY18 FY19 Shift (%) QoQ: 4% YoY: 2% 17% Shift (%) QoQ: 33% YoY: (22%) (11%) PAT 318 115 139 52 32 Q4 FY18 Q3 FY
Slide 6: Key Operational Update – Q4 & FY19
Key Operational Update – Q4 & FY19 5 SMS Sales Volume (MT) 852 779 Thousands 220 204 225 Q4 FY18 Q3 FY19 Q4 FY19 FY18 FY19 Shift (%) QoQ: 10% YoY: 2% 9% Sales Composition – Q4 FY19 Sales Composition – FY19 Export Export 17% 20% Domestic Domestic 83% 80%
Slide 7: Key Raw Materials – Price Trend
Key Raw Materials – Price Trend 6 Nickel (USD/MT) 14,470 13,276 13,239 12,369 11,573 11,463 Q3FY18 Q4FY18 Q1FY19 Q2FY19 Q3FY19 Q4FY19 Note: Average quarterly prices; Source: Bloomberg Fe Chrome (INR/MT) 81,854 76,717 76,708 76,583 75,617 71,400 Q3FY18 Q4FY18 Q1FY19 Q2FY19 Q3FY19 Q4FY19 Note: Average
Slide 8: Q4 FY19 Financial and Operational Discussions
Q4 FY19 Financial and Operational Discussions 7 Net Revenue grows to Rs. 3,251 crore, up 2% Y-o-Y – On a quarter-on-quarter basis, Sales volume registered an improvement of 10% to 224,865 MT. – Despite a challenging external trade environment, stable demand from various segments such as Railways, Me
Slide 9: FY19 Financial and Operational Discussions
FY19 Financial and Operational Discussions 8 Net Revenue grows to Rs. 12,585 crore, up 17% Y-o-Y – Sales volume increases by 9% to 852,479 MT – Higher sales volume coupled with better realizations contributed towards revenue growth in FY19 EBITDA at Rs. 1,136 crore, down by 11% Y-o-Y – EBITDA margin
Slide 10: Key Developments
Key Developments 9 Consortium of Corporate Debt Restructuring (CDR) lenders have agreed to allow CDR exit for the Company with effect from March 31, 2019 subject to requisite approval from their respective competent authorities • The recompense liability as on March 31, 2019 has been determined in c
Slide 11: Management Comment
Management Comment 10 Commenting on the performance, Mr. Abhyuday Jindal, Managing Director, Jindal Stainless Ltd. said: “CDR exit will give us more opportunities to consolidate our financial and leadership position. We are now looking forward to an intervention by the Indian Government to create a
Slide 12: Abridged P&L Statement
Abridged P&L Statement 11 YoY YoY Particular (Rs. crore) Q4 FY19 Q4 FY18 FY19 FY18 Change (%) Change (%) Net Revenue from operations 3,251 3,173 2% 12,585 10,785 17% Total Expenditure 2,949 2,784 6% 11,449 9,504 20% EBITDA 302 388 (22%) 1,136 1,281 (11%) EBITDA / ton 13,443 17,643 (24%) 13,325 16,44
Slide 13: Comfortable Debt Position
Comfortable Debt Position 12 As on As on As on Description - Borrowings Mar. March March (Rs. Crore) 2019 2018 2017 Long term debt 2,050 2,457 3,405 Inter corporate loan from related 900 900 485 party OCRPS* 695 607 - Net Debt/EBITDA Total Long term debt 3,645 3,963 3,890 5.0 Short term borrowing (l
Slide 14: Key Financial Ratios
Key Financial Ratios 13 FY19 FY18 FY17 EBITDA margin (%) 9.0% 11.9% 13.3% PAT Margin (%) 1.0% 3.0% 0.7% Net Debt to Equity 1.7 2.0 3.2 Net Debt to EBITDA 3.6 3.7 5.0 Return on Equity (%) 5.8% 15.5% 3.5% Return on Capital employed (%) 12.0% 15.6% 10.3% Note: 1) Net Debt includes short-term & long ter
Slide 15: Annexure
Annexure 14
Slide 16: About Us
About Us 15 Jindal Stainless Ltd. (JSL) is amongst the leading stainless steel For further information please contact: manufacturing companies in the world and India's largest stainless steel manufacturer. The Company operates an integrated stainless Goutam Chakraborty / Shreya Sharma steel plant at
Slide 17: Thank You
Thank You 16
Slide 18: Jindal Stainless Limited
Corporate Presentation JINDAL STAINLESS LIMITED
Slide 19: Disclaimer
Disclaimer 2 This presentation and the accompanying slides (the “Presentation”), which has been prepared by Jindal Stainless Limited (the "Company"), has been prepared purely for information purposes only and is not, and is not intended to be, an offer, or solicitation of offer, or invitation or rec
Slide 20: Content
Content 3 1 Company Overview 2 Stainless steel Sector Dynamics 3 Key Business Highlights 4 Financials 5 Conclusion 6 Annexure
Slide 21: Company Overview
Company 4 Overview
Slide 22: Snapshot
Snapshot 5 Jindal Stainless – Pioneers of the stainless steel industry in India #1 ~4 >25% 40+ Stainless steel player Decades of Group Domestic Market Exports to countries in India Excellence Share ~800 0.8Mn Tonnes ~Rs. 126bn ~Rs. 11bn Acre Total Land Area Per Annum stainless steel FY19 Revenues (N
Slide 23: Company Overview
Company Overview 6 Largest integrated stainless steel Company in India with Product Basket manufacturing facilities located at Jajpur, Odisha Robust logistics infrastructure, including in-house railway sidings, with close proximity to ports provide strong support to overall operations – ‘State-of-th
Slide 24: Stainless steel Sector Dynamics
Stainless steel 7 Sector Dynamics
Slide 25: Stainless 'Value-Added' Steel
Stainless ‘Value-Added’ Steel 8 Low Maintenance Weldability Recyclability Aesthetics Durability Stainless steel Formability Low Life Cycle Cost Corrosion Resistance Stainless steel - The “Green wonder Metal”
Slide 26: Favourable sector dynamics
Favourable sector dynamics… 9 Healthy growth in global stainless steel demand… …with stainless steel as the fastest growing metal Stainless Steel 5.4% 48.1 50.7 45.6 Aluminium 3.9% 1980 - 2017 CAGR 41.7 41.5 35.9 38.5 Copper 2.7% (mt) Carbon Steel 2.4% Zinc 2.2% 2012 2013 2014 2015 2016 2017 2018 Le
Slide 27: Consumption Pattern diversifying across categories
Consumption Pattern diversifying across categories 10 1998 2015 2023E 6% 2% 1% 3% 2% 20% 7% 7% 12% 11% 38% 57% 13% 17% 80% 25% Over the past 2 decades, stainless steel consumption in India has diversified to new value-added categories of ABC, ART and Process industries from the most primary usage in
Slide 28: Stainless steel Product Applications
Stainless steel 11 Product Applications 360o Product Applications Jindal Stainless caters to a wide range of products…
Slide 29: Architecture Building Construction
12 Architecture Building Construction (ABC) Decorative and color coated stainless steel Decorative Panels Street furniture Home furniture Escalators, elevators Sculptures & designer items Claddings Commercial Complexes Railings Stainless steel roofing sheets Gates Railway station upgradation
Slide 30: Automobile Railway Transport (ART)
13 Automobile Railway Transport (ART) Bus bodies Exhaust systems, auto chassis, trims, suspension parts, fuel tanks, catalytic convertors Railway wagons and coaches Metro coaches
Slide 31: Process & Engineering
14 Process & Engineering Nuclear grade stainless steel for fuel containment and waste handling Super critical boilers in power plants Water treatment and drinking water supply Desalination applications Chemicals, petro-chemical & fertilizer plants
Slide 32: Consumer Durables
15 Consumer Durables Washing Machine Microwave Refrigerator Utensils Components thereof
Slide 33: Macro factors driving domestic stainless steel consumption trends
Macro factors driving domestic stainless steel Consumption Trends 16 Emerging Trends expected to drive stainless steel usage Increasing shift towards stainless steel in making Railway wagons and coaches Automobile Railway New Trends in Auto sector like stainless steel Fuel Tanks, BS-VI compliant exh
Slide 34: New Age Applications
NewAge Applications 17 Stainless steel Successfully Stainless steel body emerging as a developed stainless coaches and wagons perfect metal for BS- steel fuel tanks for VI compliant exhaust commercial vehicles system Innovative solutions driving usage in newer applications
Slide 35: Key Business Highlights
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Slide 36: Integrated operations with huge opportunity to drive operating leverage
Integrated operations with huge opportunity to drive operating Leverage 19 ~800 ACRE 250,000TPA 100,000TPA 264 MW 450,000TPA Total Land Area Ferro-Alloys Mill Plate Captive Power Plant Cold Rolled Annealing Annealing & Pickling (scalable upto 500MW Pickling line High quality infrastructure and facil
Slide 37: Structural initiatives – leading to sustainable turnaround
Structural initiatives – leading to sustainable turnaround 20 Diversification and Innovation-led Lowered logistics cost reliable sourcing of operational efficiency Raw Materials Railway sidings within the plant led Expanded resources of Chrome Increased usage of liquid Ferro to multifold benefits or
Slide 38: JSL – Domestic Footprint
JSL – Domestic Footprint 21 Chandigarh Gurgaon Delhi Corporate Office Odisha Jajpur Ahmedabad Kolkata Dhamra Port Vadodara Jajpur Paradip Port Bhubaneswar Mumbai Pune Kothavalasa Visakhapatnam Hyderabad Bangalore Strategically located Chennai manufacturing facility in Jajpur, Odisha JSL and Associat
Slide 39: JSL – Global Footprint
JSL – Global Footprint 22 Poland Russia Germany Belgium Italy Spain USA China South Korea Turkey Vietnam UAE Thailand Malaysia Indonesia Brazil JSL and Associate Sales Offices JSL and Associate Service Center Manufacturing Facility
Slide 40: Key Growth Drivers
Key Growth Drivers 23 Structural growth of stainless steel demand in India • One of the fastest growing value-added metal • Various Government initiatives to further drive stainless steel demand Wide range of product applications and new segment penetration • Increasing premiumization trend and dema
Slide 41: Financial and Operational overview
Financial and Operational 24 overview
Slide 42: Turnaround in Performance
Turnaround in Performance 25 Stainless steel Sales Volume (MT) Net Revenue (Rs. mn) CAGR: 24.5% 125,850 107,846 Thousands 83,113 65,280 779 852 534 641 FY16 FY17 FY18 FY19 FY16 FY17 FY18 FY19 EBITDA (Rs. mn) Margins (%) PAT (Rs. mn) CAGR: 29.7% 13% 12% 3,183 1,390 9% 583 8% -5,591 11,067 12,809 11,3
Slide 43: Focus on strengthening the Balance Sheet
Focus on strengthening the Balance Sheet 26 Net Debt (Rs. mn) Net Debt/Equity Ratio Net Debt/EBITDA 6.1 19.1 3.2 2.0 1.7 99,663 5.0 3.7 55,861 3.6 46,918 41,037 FY16 FY17 FY18 FY19 FY16 FY17 FY18 FY19 ROE (%) ROCE (%) 15.5% 15.6% 3.5% 5.8% 10.3% 12.0% -61.1% 2.1% FY16 FY17 FY18 FY19 FY16 FY17 FY18 F
Slide 44: Comfortable Debt Position
Comfortable Debt Position 27 As on March As on March As on March Description - Borrowings 2017 2018 2019 Long term debt 34,050 24,568 20,498 Inter corporate loan from related party 4,850 9,000 9,000 OCRPS* - 6,065 6,950 Total Long term debt 38,900 39,633 36,448 Short term borrowing (less than 12 mon
Slide 45: Key Financials Highlights – FY2019
Key Financials Highlights –FY2019 28 125,850 12,809 11,359 3,183 107,846 1,390 Revenue EBITDA PAT Shift 17% (11%) (56%) SMS Sales Volume (MT) 779 852 Thousands FY18 FY19 Shift 9% Note: Standalone financials; All figures in Rs. million unless stated otherwise
Slide 46: Conclusion
Conclusion 29
Slide 47: Leadership Play
Leadership Play 30 Leadership position in the fast growing Integrated operations with state-of-art Value-Added stainless steel sector – facilities clear proxy to the sector Huge operating leverage - Fast deleveraging to low incremental capex to significantly strengthen drive future growth balance sh
Slide 48: Focus on expanding Brand and Market presence
Focus on expanding Brand and Market presence 31 Investing in various Branding & marketing initiatives to enhance overall market potential by: – Creating awareness of hygiene and health benefits of stainless steel – Increase usage of stainless steel in Home and Public Spaces Home Smart Home Campaign
Slide 49: Annexure
Annexure 32 32
Slide 50: Jindal Stainless Ltd – Global Outreach
Jindal Stainless Ltd 33 65.00% JSL 99.99% Iberjindal S.L. P. T. Jindal Stainless Indonesia • Stainless steel Service Center • Manufacturing Unit – 150,000 MTPA CR • Offers customized to the doorsteps of capacity customers in Spain • Key producer of stainless steel in South East Asian market Global O
Slide 51: Asset Monetization Plan (AMP)
Asset Monetization Plan (AMP) 34 Jindal Stainless Ltd Jindal Jindal Jindal United Jindal Coke Stainless Stainless Ltd 26% Steel Ltd 26% Ltd Hisar Ltd (JSL) (JUSL) (JCL) (JSHL) Listed Unlisted Entities Entities • Integrated SS • Steel Melting – 800,000 MTPA • Hot strip Mill – • Coke Oven – Facility –
Slide 52: Key Market Statistics
Key Market Statistics 35 Key Market Statistics As on Mar 31, 2019 BSE/NSE Ticker JSL/ 532508 Industry Stainless steel Closing Market Price (Rs.) 40.6 Market Cap (Rs. mn) 19,456 Number of outstanding shares (mn) 479.2 Face Value (Rs.) 2.00 52-week High / Low (Rs.) 105.6/24.5 Note: Prices considered f
Slide 53: Contact Us
Contact Us 36 About Us: Jindal Stainless Ltd. (JSL) is amongst the leading stainless steel manufacturing companies in the world and India's largest stainless Goutam Chakraborty / Shreya Sharma steel manufacturer. The Company operates an integrated stainless steel plant at Jajpur, Odisha. The complex
Slide 54: Thank You
Thank You 37