Ester Industries Limited · NSE:ESTER
Ester Industries — Q1 FY23 Earnings Presentation
38 slides from Ester Industries's earnings presentation, Aug 11, 2022
Slide 1: Cover letter to BSE and NSE
Date:11 August 2022 BSE Limited (BSE) National Stock Exchange of India Limited (NSE) Department of Corporate services Exchange Plaza, Phirojee Jeejeebhoy Towers Plot no. C/1, G Block, Dalal Street, Mumbai – 400023 Bandra-Kurla Complex, Bandra (E), Mumbai – 400051 Scrip Code: 500136 Symbol: ESTER Sub
Slide 2: Investor Presentation August 2022
or Presentation JSTRIES LTD. August, 2022
Slide 3: Forward-looking statements
Certain statements in this document may be forward-looking statements. Such forward-looking statements are subject to certain risks and uncertainties like government actions, local political or economic developments, technological risks, and many other factors that could cause actual results to diff
Slide 4: About Us, Q1 FY23 Performance, Ester 2.0
About Us Q1 FY23 Performance Ester 2.0 Investment Thesis Business Overview 3
Slide 5: Business overview and sales mix
Sales Mix (Q1 FY23) Diversified business portfolio Polyester Comprehensive product suite Films 66% State-of-the-art manufacturing facilities Specialty Global footprint Polymers 14% Experienced management team *Engineering Plastics 19% Strong Financial profile * Quarterly results of EP Business repor
Slide 6: Company key facts
1985 GURGAON, INDIA #3 Year of Incorporation Corporate Headquarters Business Segments* 494 – KHATIMA, About 50 COUNTRIES SITARGANJ, CRISIL A GURGAON (stable outlook) 139 - HYDERABAD Global Footprint People Credit Rating (Long Term) * PF - Polyester Film; SP - Specialty Polymers; EP - Engineering Pla
Slide 7: Manufacturing locations
Sitarganj Haryana Uttarakhand Gurgaon Khatima Telangana* Corporate Headquarter Manufacturing facility *New BOPET Film plant under implementation Commercial production expected by October 22 6
Slide 8: We serve about 50 countries
Global Pr We serve about 50 Countries : :
Slide 9: 8
8
Slide 10: Q1 FY23 consolidated results
Particulars (Rs.cr) Q1 FY23 Q1 FY22 % Q4 FY22 % Revenues 402 319 26.0 388 3.6 EBITDA* 73 65 13.4 65 12.4 Margins (%) 18.2 20.2 (200 bps) 16.8 +140 bps PAT 42 38 11.9 33 28.7 Margins (%) 10.5 11.8 (130 bps) 8.5 +200 bps *including other non operating income Core businesses - Films and Specialty Pol
Slide 11: Chairman's comments on results
Commenting on the results, Mr. Arvind Singhania, Chairman, Ester Industries said “We have started the year on a strong note, with both our core businesses Films and Specialty Polymers registering good growth in revenue and profitability. Specialty Polymer business has not only maintained its recent
Slide 12: Ester 2.0
ESTER INDUSTRIES LTD. Ester 2.0 Company “Specialty
Slide 13: Ester 2.0: knowledge, innovation, customization, technology
Knowledge Innovation ESTER Customization 2.0 Technology 12
Slide 14: Ester 1.0 achievements and Ester 2.0
Achievements Ester 2.0 Ester 1.0 Specialty Polymers SBU o Largely patent protected Revenues – high entry barriers (FY12-FY16) (FY17-FY22) o High sustainable Commoditized product 2.4% CAGR 14.7% CAGR margins portfolio o High growth potential Limited bargaining EBITDA BOPET Film SBU power (FY1
Slide 15: Revenues, EBITDA, margins and PAT FY12-FY22
Revenues (Rs.cr) EBITDA (Rs.cr) 1,405 236 243 886 928 896 771 1,028 1,039 992 189 700 707 824 108 74 71 70 66 35 41 42 FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19FY20 FY21 FY22 FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19FY20 FY21 FY22 EBITDA Margins (%) PAT (Rs.cr) 142 139 24.6% 100 19.1% 17.9%* 31 8 4 7 5
Slide 16: Debt, ROCE and dividend payout
Debt (Rs.cr) ROCE (%) 335 363 348 31% 304 300 290 28% 242 267 26% 237 142 157 14% 8% 7% 7% 7% 3% 3% 3% FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19FY20 FY21 FY22 FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19FY20 FY21 FY22 Dividend Payout (%) 37% 21% 20% 20% 13% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% FY12 FY13 FY14 FY15
Slide 17: Shareholding pattern
34.23 35.62 35.57 40.86 % % % % Mar 20 Mar 21 Mar 22 Jun 22 59.14 64.04 64.04 64.04 % 1.73% % 0.34% % 0.39% % 16
Slide 18: Specialty Polymers and Polyester Films focus
Specialty Polymers - Polyester Films - High Largely IP protected share of value added product portfolio products Rewarding shareholders with Scaling up capacities dividend Strong balance sheet 17
Slide 19: Green initiatives, focus on sustainability
Green Initiatives Focus On Sustainability BIO-BASED Fuel Consumption oo $ PVC FREE fe oa wist Wrap / Shrink Film) BIO-BASED Raw Material me Pvec FREE PAC (Transparent High B Ss PACKAGING MATERIA Reduction/ Recycling y \3 IL REPLACEMENT & lized High Barrier film) ® w=
Slide 20: Specialty Polymer
Se 4 q ESTER INDUSTRIES LTD. Specialty Polymer
Slide 21: Largely IP protected business
Customer High entry retention Largely IP High barriers – ensured as Marquee Export protected margin patent largely clientele oriented business business protected patent protected
Slide 22: Business opportunity: stain resistant carpets
Problem Solution Business Opportunity USA, largest High cost towards carpet stain Flexible low cost solution producer of Carpets removal Ester has developed a PET based & Rugs boasts of an industry with Stain marks on (nylon) carpets given master batch, which imparts permanent spillover / spilla
Slide 23: Innovative PBT supply to global chemical leader
Regularly manufacturing & supplying Innovative Signed ‘Manufacture and Supply Agreement’ with a Polybutylene Terephthalate (PBT) polymers to a global global chemical leader in April 2019 effective 1st April chemical leader 2019 for 2 years for 400 MT per annum Ester Industries is among the only comp
Slide 24: Strong product pipeline
MB07 o MB07 is added to make polyester dye-able with deeper and darker color o Achieved customer approval after 3 years of relentless hard work o Started commercial sales with good volumes Strong o Achieved sales of 830 MT during FY22 product pipeline Global supply chain disruptions & inflationary
Slide 25: Applications
Consumer electronics Polyethylene Terephthalate (PET) Textile – Flame Retardant, Deep dyeable master batches, Cationic dyeable master batch Applications Products Polybutylene Terephthalate (PBT) Carpets – Stain Resistant Master Batches Carpets – Deep Dyeable Master Batch Polyethylene Naphthalate (PE
Slide 26: Specialty Polymers Q1 FY23 performance
Figs. in cr Q1 Q1 Q4 Particulars % % FY23 FY22 FY22 Volumes (MT) Sales 1,082 861 25.6 903 19.8 Q1FY22 Q1FY23 (Vol's MT) Revenue 58 35 65.7 47 23.4 EBIT 18 13 38.5 14 28.6 344 Innovative PBT Margins (%) 30.9 36.4 (550 bps) 28.9 +200 bps 485 Higher product off-take resulted in revenue growth both on
Slide 27: Packaging Film Business
ESTER INDUSTRIES LTD. Packaging Film Business 26
Slide 28: Global and domestic scenario
Global Scenario: Domestic Scenario: Demand growth of 6% - 6.5% Strong double digit growth rate of 11%-13% pa over BOPET film used in flexible packaging applications past 5 years will continue to be the key end use sector, Low per capita consumption of BOPET; new accounting for nearly 60% of
Slide 29: Film business capacities and key facts
60,000 13,200 #30+ MTPA MTPA Years of experience Polyester Film Mfg. capacity Metallized Polyester Film Mfg. capacity About 67,000 48,000 50 22% MTPA MTPA* Export market Share of value-added Polyethylene Terephthalate BOPET Film Capacity (# of countries) products (Q1 FY23) (Polyester) chips Mfg. exp
Slide 30: Value added share and domestic/export mix
Value Added (%) *Film business (excl. chips) Domestic Exports 22 (Rs.cr) FY19 FY20 FY21 FY22 20 17 17 EBIT 118 180 219 150 30 23 29 30 Margins 16.4 24.5 31.9 17.8 70 77 71 70 (%) FY19 FY20 FY21 FY22 FY19 FY20 FY21 FY22 Product mix – despite reduction Pass through business model – in recent past, aim
Slide 31: Applications
White Opaque High Clear Flexible Packaging Applications High Barrier Embossable Barrier Packaging Products Heat Saleable Twist Wrap Embossing Shrink film Anti - Static Lidding Metalized High Matte Label & Graphics Barrier 30
Slide 32: Film business Q1 FY23 performance
Figs. in cr Particulars Q1FY23 Q1FY22 % Q4 FY22 % Revenue* 266 225 18.2 256 3.9 EBIT+ 53 36 47.2 49 8.2 Margins (%) 19.8 15.9 +390 bps 19.2 +60 bps *Revenue includes chip sales worth Rs. 4.27 cr (Q1 FY23) ; Rs. 26 cr (Q1 FY22); Rs. 21.06 (Q4 FY22) +Adjusted for chip sales, EBIT for Film business wou
Slide 33: Capex of Rs 606 cr for new BOPET plant
Capex of Rs.606cr 18% 17% EBITDA Margin (%) to result in.. 110 92 EBITDA 208 Revenue Internal Accruals Debt 597 537 398 Capex FY24 FY25 Setting up state of the art 48,000 MTPA BOPET Film plant and 8,333 MTPA Metallized BOPET Film plant in Telangana through Wholly Owned Subsidiary Achieved financ
Slide 34: Engineering Plastics
Engineering Plastics
Slide 35: Engineering Plastics Q1 FY23 performance
Figs. in cr Particulars Q1 FY23 Q1 FY22 % Q4 FY22 % Sales Volume 2,816 2,400 17.3 3,246 (13.2) (MT) Revenue 78 59 32.2 85 (8.2) PBT 11 22 (50) 12 (8.3) PBT Margins (%) 13.7 37.2 (2,350 bps) 14.4 (70 bps) Double-digit volume and revenue growth on a Y-o-Y basis due to lower base; Q-o-Q decline refle
Slide 36: Sale of Engineering Plastics business to Radici
Entered into a definitive agreement to sell its Engineering Plastic Business to Radici Plastics India Private Limited in an all-cash slump sales transaction, amounting to Rs 289.33 crore (subject to adjustments specified in Business Transfer Agreement (BTA) and other agreements) Strategic exit e
Slide 37: About Us and contact
About Us: (CIN :- L24111UR1985PLC015063) Incorporated in 1985, Ester Industries Limited (EIL) is an ISO 9001:2008,ISO 22000:2005,TS16949:2002 certified Company engaged in the manufacture of polyester films, specialty polymers, engineering plastics and polyester chips with manufacturing facilities lo
Slide 38: Thank You
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