Spencer's Retail Ltd. · NSE:SPENCERS
Spencer's Retail — Investor Presentation (2021)
53 slides from Spencer's Retail's investor presentation, 2021
Slide 1: Business Overview
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Slide 2: Disclaimer
Disclaimer This presentation is issued by Spencer's Retail Limited (the "Company") for general information purposes only, without regard to specific objectives, suitability, financial situations and needs of any particular person. This presentation does not constitute or form part of any offer or in
Slide 3: Organized Retail opportunity in India
Organized Retail opportunity in India #3
Slide 4: Organized Retail Share growing at CAGR ~18%
Organized Retail Share growing at CAGR ~18% Opportunity for “uniquely positioned” retailers • Organised retailers to benefit with Organised Retail growing faster than consumers tilting towards organised Overall Retail Growth space. 8.7 7.4 • Retailers with unique & 6.4 differentiated positioning wil
Slide 5: The future of retail is "OMNI Channel"
The future of retail is “OMNI Channel” Combination of Physical & Online Platform Moving Towards OMNI Channel • Increase in usage of E-commerce platforms by Consumers. 6.3 5.5 0.2 • Shopping has become a 4.8 0.2 convenient mix of both Offline 4.1 0.1 (Physical) & Online platforms. 3.5 3.1 0.1 0.1 2.2
Slide 6: Spencer's presence across segments in Organized Retail
Spencer’s presence across segments in Organized Retail Spencer’s Retail Limited is present across ~72% segment share of organised Retail Segment Market size share in. Market Penetration Organised Retail Others ~26% Food & Grocery ~19% ~4% Books & Apparel ~23% ~25% Music ~1% ~72% Consumer Durables, M
Slide 7: Contents
Contents Company Snapshot Key Differentiators Annexures #7
Slide 8: Contents
Contents Company Snapshot Key Differentiators Annexures #8
Slide 9: RP- Sanjiv Goenka Group
RP- Sanjiv Goenka Group Diversified Business House FY21 Operating Power utility company engaged in coal mining, Revenue in INR (Cr) generation and distribution of electricity Largest Indian & 7th largest global carbon 2660 black manufacturer 1325 India's premier organised multi-format retailer 2428
Slide 10: Spencer's Retail: Evolution of the Business
Spencer's Retail: Evolution of the Business 2006-2009: Spencer's brand 2010 -2018: Consolidation by 2019 onwards: 1989-2005: Introduced Modern launch and rapid shutting down non-performing Focus on Retail to India expansion stores profitable growth RPG 1st hypermarket Spencer's had Company
Slide 11: Targeting a Well-Defined Customer-Base
Targeting a Well-Defined Customer-Base… 2017 14% Share of Working Age The proportion of nuclear Population 19% households has reached 70% 16% and is projected to increase to 25% 74% by 2025 50-64 28% Nuclear families spend 20% to 30% more 26% Years 36-49 per capita than joint families 17% Years
Slide 12: Increasing Customer Stickiness
…. Increasing Customer Stickiness… Consistent increase in Customer centric communication & share of wallet by leveraging precision targeting & personalisation through CRM, Online, Digital & Social Media, WhatsApp outreach Activities ensuring high cross sell to customers Non-Food Adopter Programmatic
Slide 13: Efficient Operations
…. Efficient Operations Efficient In-store Management along with Centralized Control Ensuring Lean Cost Structure In-store Management Supply Chain Efficiency Defined store work plan to ensure Lean cost structure with centralized replenishment control standardization across stores Distribution &
Slide 14: Providing Shopping experience for every stage of digital maturity
Providing Shopping experience for every stage of digital maturity Serving customers by becoming a true OMNI Channel player by providing superior shopping experience through digital transformation with varied assortment, differentiated offerings, tie- ups with partners for last mile deliveries, ‘Out
Slide 15: Business Portfolio
Business Portfolio India's premier organised multi-format retailer, Makes Fine Living Offering customers great Affordable choice, great price and great experience Differentiated Business One-stop-destination for Model of International foods multi-cuisine, organic offering products ranging from and i
Slide 16: Spencer's Positioned as a Holistic grocery shopping environment
Spencer's Positioned as a Holistic grocery shopping environment though its wide & unique range of products Differentiated Fresh Section Unique Fish & Meat offerings One-stop destination for multi- cuisine cooking needs. Experiential Shopping & Preferred destination Wide range of assortments smooth c
Slide 17: Business Snapshot: Consolidated
Business Snapshot: Consolidated Scale Efficiency ₹ 2,428 Cr. 92% >14% ~29% FY21 Operating FY21 Recovery FY21 Share of ABV Growth Revenue from Pre-COVID Non-Food Sales* from FY20 14 ~ 1.09 lac sq. ft. 20.4% 21.4% # of New Stores Trading Area FY20 FY21 opened during added during Gross Margin Gross Mar
Slide 18: Contents
Contents Company Snapshot Key Differentiators Annexures #18
Slide 19: Our Strategic Pillars
Our Strategic Pillars Profitable Growth in chosen Geographies Optimal Product Mix ~ Increasing share of High Margin Categories Strong Omni Channel #19
Slide 20: Profitable Growth in Chosen Geographies
Profitable Growth in Chosen Geographies Spencer’s and Natures Basket Spencer’s + Natures limited has strong presence in high Basket Presence growth territories NORTH 47 Stores Natures Basket limited, which gave us access to the attractive western India market ~70% of Total Retail Spend EAST Expe
Slide 21: Large Format vs Small Format
Spencer's Retail Led by Large Format Stores to drive profitability and improve margins # of # of Cities Average Revenue Typical Mix of Key Differentiators Stores Present in Store Area Share Assortment Destination format Large Format 30% Offers all categories including 15,400 20% non-food such as
Slide 22: Business Model
Business Model Capex Cost Revenue ₹1500 to ₹2000 ₹1000 to ₹2000 per sq.ft. sq.ft. per month Store Size 5000- 25000 sq.ft. Store EBITDA margins 5% to 6% Payback period of 3 to 5 years #22
Slide 23: Spencer's & Natures Basket – Optimal Mix
Spencer's & Natures Basket – Optimal Mix # of # of Cities Average Revenue Typical Mix of Key Differentiators Stores Present in Store Area Share Assortment 34% Destination & Convenience format Spencer's Offers all categories including non-food such as apparel, general merchandise & 8,500 20% 66%
Slide 24: Spencer's - becoming a true OMNI Channel
Spencer's - becoming a true OMNI Channel Moving towards Major shift of gear in direct to customer OMNI Channel Being Part of channel Community via hyper local Direct Customers Connect Store as Hub Online-road to Contactless delivery ‘Out of Store’ Sales, Phone Delivery & WhatsApp ordering Chatbot pr
Slide 25: Business Model
Business Model Capex Cost Revenue ₹6500 to ₹7500 ₹2500 to ₹3000 per sq.ft. sq.ft. per month Store Size 1500- 5500 sq.ft. Store EBITDA margins 7% to 9% Payback period of 3 to 5 years #25
Slide 26: Reduction in losses by ~70% by strategic turnaround of Natures Basket Limited
Reduction in losses by ~70% by strategic turnaround of Natures Basket Limited Particulars (₹ cr) Q2 Q3 Q4 FY20 Q1 Q2 Q3 Q4 FY21 Sales 88 94 87 273 108 91 87 77 363 Other Income 0 0 1 2 1 1 2 2 6 COGS 72 72 65 214 79 67 65 54 265 Gross Margin 15 22 22 59 28 24 22 23 98 Gross Margin % 17.6% 23.4% 25.8
Slide 27: Natures Basket - Initiatives
Natures Basket - Initiatives Natures Basket as a Strengthening our Gifting Destination Health Positioning • Strengthening Health • Launch of The Gift positioning Studio (TGS) • Offerings to • Leveraging digital communicate & strengthen our platforms product offerings Customer Engagements Superior Co
Slide 28: Well Differentiated and Diversified Private Brands
Well Differentiated and Diversified Private Brands Delighting customers with wide range of quality products through our own brands Apparel Cognitive Staples & FMCG Excremental GM Routine E&E Private Brands products have 5-10% higher gross margins than the branded products #28
Slide 29: Focus on Non-Food Business: Higher Margin Categories
Focus on Non-Food Business: Higher Margin Categories • Adding Private Brand products in Non-food categories • Efficiency in Inventory management through SOR Mix • Increased choice for customer with introduction of multiple new national brands #29
Slide 30: Indian E-Commerce & Online Grocery Market
Indian E-Commerce & Online Grocery Market India's E-Commerce Market CAGR of 27% over (US $ billion) 2019-24, with grocery Indian Online Grocery and fashion/apparel (US $ billion) 99 likely to be the key 18.2 drivers for incremental growth E-commerce sales in 30 22 India only increased by 7-8% in
Slide 31: Online Business Growth >6.5X
Online Business Growth >6.5X • ORIPL is an E-commerce company 100% owned Subsidiary of Spencer’s Retail Limited • Online store for Food, Grocery, Fresh, Apparel, General Merchandise and Liquor Significant investments were made during the year in the online platform In India, Online penetration to
Slide 32: Our response to COVID
Our response to COVID Business 1. Ensured safe and hygiene environment for employees and customers 2. No Mask No Entry, Social distancing, Thermal screening & frequent Continuity sanitization OMNI Channel 1. Leveraged E commerce channel for ease ordering & wider reach Ecommerce 2. Store as a platfor
Slide 33: Free Vaccination Drive for all Employees
Free Vaccination Drive for all Employees Safety of employees and customers shall remain the most important endeavour of the company . Large number of our employees at Spencer’s have already been vaccinated and the drive is continuing. Financial protection to Frontline employees through Insurance, me
Slide 34: Embracing the new normal at our stores
Embracing the new normal at our stores Mandatory Face Mask & Thermal screening Deep Social cleaning & distancing frequent marks on disinfection ground Sanitizing Virtual basket, meetings trollies & prescribed Cash tills Contactles Store as a s delivery platform #34
Slide 35: Environment, Social and Governance
Environment, Social and Governance #35
Slide 36: ESG – Synonymous with Sustainability
ESG – Synonymous with Sustainability ENVIRONMENTAL SOCIAL GOVERNANCE (E) (S) (G) Duty Relationship Functioning of Towards With External the Business & The & Internal Conduct of the Planet Stakeholders Management ESG Focus Spencer’s have made extensive qualitative investments with an objective to enh
Slide 37: Environmental Empathy
ENVIRONMENTAL EMPATHY Waste Management Ecological Impact Company has stopped using Company has significantly single-use plastic and increased the share of electronic formulated a policy under EPR transactions vs physical paper to comply with Plastic waste based transactions management rules Company
Slide 38: Our Environmental Practices
Our Environmental Practices …. Energy Efficient Our Say yes to cloth Corporate bags and Office RPSG #No To Plastic House is bags! certified as Green Building by IGBC #38
Slide 39: Social Responsibility
SOCIAL RESPONSIBILITY Gender Women Equality Empowerment Company believes in Company encourages providing equal women employment & it has ~25% women opportunity to any individual without any Employee workforce. Promoting discrimination Engagement women safety causes with Statutory bodies Company unde
Slide 40: People & Culture
People & Culture Employee Safe & Capability Engagement centric Hygienic work building & & practices environment Support Development Leadership Training: Deep Cleaning & Train and Build Training: Focus on WFH & Office : Work Disinfection: Leaders of Tomorrow Functional & from home & Office Fr
Slide 41: Our Social Practices
Our Social Practices…. Customer Feedback Women Day Celebration Training Support in World Food Program for Kingdom of Bhutan Gender Diversity Customer Feedback #41
Slide 42: Our Social Practices
Our Social Practices…. Women Safety and Customer Empowerment Satisfaction Happy to serve the Nation during challenging times #42
Slide 43: People & Culture
People & Culture…… Celebrating the Retail Best in class practices Employee Day followed #43
Slide 44: Corporate Governance
CORPORATE GOVERNANCE Ethical Efficient Strong Internal Practices Management Controls The company has a The Company has efficient management The Audit committee code of conduct; it has and has strong Board comprises of 4 non- prescribed guidelines structure with executive directors out & processes fo
Slide 45: Our Governance practices
Our Governance practices…. Insider Trading Essential service (Groceries), Joint Compliance Tool program with Noida Authority Legal Compliance Management Tool #45
Slide 46: Corporate Governance
Corporate Governance Diverse Board Management Team Balanced mix of independent and professional directors Continuous review of performance of Board is guided by the following committees management team and guidance by Board to ─ Audit Committee with majority independent directors ensure improv
Slide 47: Management Team
Management Team Shashwat Goenka Non – Executive Director Alumni of The Wharton School of The University of Pennsylvania Heads Retail and FMCG business of RP-Sanjiv Goenka group Chairman - CII National Committee on Retail Devendra Chawla Tanmay Kumar Managing Director & CEO Chief Financial Offi
Slide 48: Contents
Contents Company Snapshot Key Differentiators Annexures #48
Slide 49: Consolidated Financials
Consolidated Financials 12 months period ended Growth Consolidated (₹ Cr) ended 30-Jun-21 31-Mar-21 30-Jun-20 Y-o-Y Q-o-Q 31-Mar-21 552 592 547 1% -7% Revenue from operations 2,428 439 467 435 Cost of Goods Sold 1,932 113 125 112 1% -9% Gross Margin 496 20.5% 21.1% 20.5% 1 bps -61 bps Gross Margin %
Slide 50: Standalone Financials: Spencer's Retail Limited
Standalone Financials: Spencer's Retail Limited 3 months ended Growth 12 months SRL Standalone (₹ Cr) ended 30-Jun-21 31-Mar-21 30-Jun-20 Y-o-Y Q-o-Q 31-Mar-21 2 5 - New Stores added 5 154 164 158 Total Store count 164 0.39 0.25 - TA added (Lac sq.ft) 0.25 13.69 13.74 13.37 TA exit (Lac sq.ft) 13.74
Slide 51: Natures Basket Limited continues to be EBITDA positive despite pandemic impact on Sales
Natures Basket Limited continues to be EBITDA positive despite pandemic impact on Sales 12 months 3 months ended Growth NBL Standalone (₹ Cr) ended 30-Jun-21 31-Mar-21 30-Jun-20 Y-o-Y Q-o-Q 31-Mar-21 33 33 31 Total Store count 33 0.93 0.93 0.84 TA exit (Lac sq.ft) 0.93 80 77 108 -26% 4% Revenue from
Slide 52: ORIPL Improved Profitability & 3.1x GMV growth
“ORIPL” Improved Profitability & 3.1x GMV growth 12 months 3 months ended Growth ORIPL Standalone (₹ Cr) ended 30-Jun-21 31-Mar-21 30-Jun-20 Y-o-Y Q-o-Q 31-Mar-21 118.0 54.0 38.0 3.1x 2.2x Gross Merchandise Value (GMV) 183.0 7.9 0.8 1.0 707.4% 866.9% Revenue from operations 3.8 3.1 1.8 1.7 87% 77% E
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