Balrampur Chini Mills Ltd · NSE:BALRAMCHIN
Balrampur Chini Mills — Investor Presentation (November 2010)
41 slides from Balrampur Chini Mills's investor presentation, November 2010
Slide 1: Balrampur Chini Mills Ltd
BALRAMPUR CHINI MILLS LTD November 2010 1
Slide 2: Topics
TOPICS 1. Industry – Global Overview and Outlook ¾ World Production and Supply ¾ Key Producing Countries ¾ Per Capita Consumption of Sugar 2. Indian Sugar Industry ¾ An Overview ¾ Size of the Indian Sugar Industry ¾ Domestic Sugar Balance 3. Indian Sugar Industry – Key Policies and Regulations ¾ Pro
Slide 3: Topics
TOPICS 4. BCML Business Model, Strategy and Growth Outlook ¾ Balrampur Chini …….. Backdrop ¾ Factory Locations ¾ BCML Capacities at a glance ¾ A credible business model and future plans ¾ Shareholding Pattern ¾ Farmer Relationship, Technology & Infrastructure, Quality & Production, Human Resource ¾
Slide 4: Topics
TOPICS 6. BCML – Risks and Concerns ¾ Industry Threat & Challenges ¾ Risk & Concern – BCML’s Response ¾ Strengths & Opportunities 4
Slide 5: Industry – Global Overview and Outlook
Industry – Global Overview and Outlook 5
Slide 6: World Production & Supply
World Production & Supply World Sugar Balance (Million Tonnes) USDA USDA USDA USDA USDA USDA USDA’ USDA BCML 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2010-11E Opening Stock 36 37 34 30 35 39 28 26 25 PRODUCTION 142 141 145 164 166 144 153 164 162 Brazil 26 28 27 31 32 32 36 41
Slide 7: Key Producing Countries
Key Producing Countries In '000 Tonnes m onnes 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11E [Raw Value] Brazil 23810 26400 28175 26850 31450 32100 31850 36400 40700 European Union [EU] 26451 24961 27181 27517 25436 24616 20520 23138 20392 India 22140 15150 14170 21140 307
Slide 8: World wide per capita consumption of sugar
World wide per capita consumption of sugar Indian consumption increasing at a CAGR of 3.1% 8
Slide 9: Indian Sugar Industry
INDIAN SUGAR INDUSTRY 9
Slide 10: An overview
An overview Over 553 sugar factories in India widely dispersed over UP, Maharashtra and other States Ownership of sugar sector – 50% private sector and 50% in co-operative & Govt Sector Average crushing capacity about 3500 TCD Uttar Pradesh [in North] and Maharashtra [in West] produce 60% of sugar i
Slide 11: Size of Indian Sugar Industry
Size of Indian Sugar Industry 11
Slide 12: Domestic Sugar Balance
Domestic Sugar Balance (Million Tones) F2007 F2008 F2009 F2011E Opening Stock 11.32 11.66 8.54 4.87 3.91 8.48 7.81 2.51 3.51 Production 20.14 13.99 12.69 19.27 28.30 26.33 14.70 18.50 25.00 Increase in Production 8.86% | -30.54% | -9.29% | 51.85% | 46.86% | -6.96%| -44.17%| 25.85% | 35.14% Internal
Slide 13: Indian Sugar Industry: Key Policies and Regulations
INDIAN SUGAR INDUSTRY: KEY POLICIES AND REGULATIONS 13
Slide 14: Production – Releases and Import
Production – Releases and Import ¾90% of production is sold as free sugar under the monthly release mechanism announced by the Central Government ¾10% of production is sold as levy sugar for Public Distribution System [PDS] ¾Levy obligation which was 20% for season 2009-10 has been automatically rev
Slide 15: Ethanol – Blending Programme
Ethanol – Blending Programme ¾ 5% Ethanol blending with petrol has been made compulsory with effect from 1st October2003 in nine sugar producing States ¾ Will save substantial forex ¾ Eco-friendly product : answer of the times ¾ Will lower emission of green house gases. Will take to Euro IV faster ¾
Slide 16: Co-generation incentives attractive
Co-generation incentives attractive ¾ Sugar industry can generate 4000 MW surplus power by using bagasse a by product ¾ 10% power in the country to come from renewable energy source ¾ Power generation from bagasse comes under clean power and eligible to get carbon emission trading benefits ¾ Govt. t
Slide 17: BCML Business Model, Strategy and Growth Outlook
BCML Business Model, Strategy and Growth Outlook 17
Slide 18: Balrampur Chini … Backdrop
Balrampur Chini … Backdrop ¾ BCML operated two mills across 24 years until 1998-99, then added seven in 10 years since ¾ Acquired Babhnan Sugar [800 TCD then, now 10000 TCD] in 1990, Tulsipur Sugar [2500 TCD then, now 7500 TCD] in 1998 and Rauzagaon [7500 TCD then, now 8000 TCD] in 2006 ¾ Set up its
Slide 19: Factory Locations
Factory Locations ws , 77 P | a BALRAMPUR CHINI MILLS LTD.
Slide 20: BCML – Capacities at a glance
BCML – Capacities at a glance 20
Slide 21: BCML – A credible business model & Future Plans
BCML – A credible business model & Future Plans ¾ Sugar production facilities are located in a radius of 200 K.M ¾ Locational advantage will help better utilisation of products resulting in substantial value addition ¾ The Company has set up refinery of 500 TCD at its Haidergarh unit which make the
Slide 22: BCML Share Holding Pattern (%)
BCML Share Holding Pattern (%) 22
Slide 23: Farmer Relationship, Technology & Infrastructure, Quality & Production, Human Resources
BCML - Farmer Relationship, Technology & Infrastructure, Quality & Production, Human Resources ¾ Enjoys extremely good relationship with farmers in its command areas ¾ Company instals latest technology and machinery to achieve the highest operational result ¾ Latest machines, technology and infrastr
Slide 24: Organizational set up
—_ SSS ee eee Organizational set up BALRAMPUR CHINI MILLS LTD [ BOARD OF DIRECTORS | [ MANAGING DIRECTOR -K—_1 JT. MANAGING DIRECTOR | | EXECUTIVE PRESIDENT ] -— DIRECTOR CUM CFO } CHIEF GENERAL mance | IUNITWISEI 1 COMPANY SECRETARY WHOLE TIME DIRECTOR | | GM-COMMERCIAL ] SR. GM- SALES & MKTG [ GM-
Slide 25: Profile of Directors
Profile of Directors Chairman Emeritus : SRI . KAMAL NAYAN SARAOGI, Chairman Emeritus, is a graduate in commerce. He promoted the company in 1975. He possesses several years of experience in the sugar industry. He does not hold directorship in any other company Board of Directors : SRI. NARESH CHAND
Slide 26: Profile of Directors
Profile of Directors SRI. S.B. BUDHIRAJA, Director, is an independent management consultant, a gold medallist in Mechanical Engineering from the University of Roorkee. He was the youngest-ever Managing Director of Indian Oil Corporation from 1974-78. He has also been the Managing Director of IBP, Ba
Slide 27: BCML Financials
BCML FINANCIALS 27
Slide 28: Segment-wise contribution in net turnover
Segment-wise contribution in net turnover 28
Slide 29: Segment-wise contribution to PBIT
Segment-wise contribution to PBIT 29
Slide 30: Cane Crushing, Production, Recovery
Cane Crushing , Production, Recovery Details of the cane crushing, production and recovery year to year in respect of existing Units are presented below : 30
Slide 31: Sugar Efficiency
Sugar Efficiency Balrampur achieves highest operational efficiency in production The sugar recovery is the highest in east U.P 31
Slide 32: Financials
Financials 12 Month Rs. Million September FY ENDED SEPTEMBER 30th FY ENDED ON MARCH 3ist 2010 2009 2008 2007 2006* 2003 2004 2005 Gross Sales 20,342.7 | _17,710.2 | 15,525.0 14,763.2 19,897.7 6,675.8 8,022.9 9,302.6 ‘Total income [incl.stock adjustment] 21,172.1 | 14,429.9 16013.3| 16,164.5 16,240.0
Slide 33: Financial Performance Ratios
Financial Performance Ratios 33
Slide 34: Balance Sheet Ratios
—_ SSS ee eee Balance Sheet Ratios 2004-05 2005-06 2006-07 2007-08 2008-09 DEBT EQUITY RATIO 0.41 0.39 1.10 1.01 0.83 INVENTORY TURNOVER [DAYS] 183 36 107 131 71 CURRENT RATIO 1.49 1.10 1.02 1.51 2.74 QUICK RATIO 0.30 0.64 0.42 0.55 140 ASSET TURNOVER RATIO (TOTAL 078| 1.09| 054| 054| 0.66 REVENUE /
Slide 35: Per Share Data [Rs.]
SSS ee eee Per Share Data [Rs.] Financial Year 2004-05 2005-06 2006-07 2007-08 2008-09 EPS [Rs.] 6.16 12.19 (1.69) 3.83 8.86 CEPS [Rs.] 7.99 15.00 1.55 8.45 13.08 DIVIDEND [Rs.] 1.60 3.50 - 0.50 3.00 BOOK VALUE [Rs] 21.15 36.31 34.69 39.65 45.75 PRICE / EARNINGS [ TIMES ] 11.27 8.32 - 21.18 13.82 NE
Slide 36: Financial Results
—_ SSS ee eee Financial Results (In Lacs) st Particulars Quarter Ended 12 Months Year No Penod Ended Ended 30_09_2010 | 30_09_2009 30.09.2010 30.09.2009 Unaudited | Unaudited Unaudited Audited 1 fa) Net Sales/income fom Operations 50828 37890 197367 170004 ib) Other Operating Income 448 106 1293 454
Slide 37: Industry Risks and Concerns
Industry Risks and Concerns 37
Slide 38: Industry Threats & Challenges
Industry Threats & Challenges Threats • The sector is vulnerable to political interventions in raw material pricing, sale timing and other ad hoc measures • Fertilizer and pesticide overuse can reduce soil potency • Unreasonable increases in sugarcane cost Challenges • Low installed capacities of th
Slide 39: Risk & Concern – BCML's Response
Risk & Concern – BCML’s Response CYCLICALITY OF SUGAR INDUSTRY FINANCIAL RISK Response : Derisking Business Module Sugar Industry being cyclical, adequate funds BCML switched to integrated business model. may not be available for working capital or Commissioned three distilleries [ 320 KLPD], eight
Slide 40: Strengths & Opportunities
Strengths & Opportunities Strengths • India is the second largest sugar producer in the world after Brazil • Its production can make the country self-reliant in this essential commodity • It provides direct employment [including ancillary activity] to nearly 50 million workers, catalyzing rural soci
Slide 41: Thank You
Thank You No part of this presentation is to be circulated, quoted, or reproduced for any distribution without prior written approval from BALRAMPUR CHINI MILLS Limited, FMC Fortuna, 2nd floor, 234/3A, A.J.C. Bose Road, Kolkata – 700 020, India. Certain part of this presentation describing estimates
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